Author: Fu Ruo, Odaily Planet Daily
In 2024, the investment and financing heat in the crypto field decoupled from the overall market trend, and VC tokens no longer dominated market performance.
On a macro level, the crypto market experienced numerous historical moments in 2024, including the launch of Bitcoin spot ETFs, the launch of Ethereum spot ETFs, the clarification of regulatory policies in various countries, the Federal Reserve's announcement of interest rate cuts, and Trump’s impending return to the White House, among other positive macro factors, successfully pushing Bitcoin to break through the important milestone of 100,000 USD.
From within the crypto market, memes have become a focal point of market attention, with different types of memes at different times acting as boosters for market rises. VC projects have performed poorly, with the linear release cycle of tokens becoming a chronic 'poison' for VC projects.
Due to the influence of comprehensive factors, the number of financing transactions in the primary market has increased significantly, but the financing amounts are more cautious.
Looking back at the investment and financing activities in the primary market in 2024, Odaily Planet Daily found:
● In 2024, the number of financing transactions in the primary market was 1,295, with a disclosed total financing amount of 9.346 billion USD;
● The AI sector has shown its strength, with a surge in the number of financing transactions in Q4 of 2024;
● The largest single investment amount was 525 million USD for Praxis.
Note: Odaily Planet Daily categorized all projects disclosed in Q1 financing (actual close time often earlier than news release) into five major tracks based on various dimensions, such as business types, service targets, and business models: infrastructure, applications, technology service providers, financial service providers, and other service providers. Each track is further divided into different sub-sectors including GameFi, DeFi, NFT, payments, wallets, DAO, Layer 1, cross-chain, and others.
In 2024, it belongs to BTC and meme coins.
An overview of the financing situation in the primary market over the past three years leads to an important conclusion: the investment and financing activities in the primary market in 2024 have gradually decoupled from the overall trends of the crypto market, with market conditions primarily dominated by Bitcoin and meme sectors, while traditional VC projects have performed poorly, making it difficult to become the core driving force of the market.
From data analysis, 2022 was the peak period of the previous crypto market cycle, with highly active financing activities in the primary market, and the changes in quantity and amount were almost synchronized with market conditions. In the first quarter of 2022, the number of financing transactions reached 562, with an amount as high as 12.677 billion USD. However, as the market entered a downward cycle, financing activities quickly shrank, and by the fourth quarter, the number of transactions had dropped to only 330, with amounts declining to 3.375 billion USD.
The year 2023 continued the bear market effect, with financing activities in the primary market and the overall market performing poorly. The number and amount of financing continued to decline throughout the year, dropping to 232 transactions and 1.725 billion USD by the third quarter, marking the lowest point in nearly three years. During this period, the primary market was clearly affected by the overall market trend, suppressing market sentiment and capital activity.
The year 2024 became an important turning point for investment and financing activities in the primary market. The data shows that the number of financing transactions significantly rebounded, with the first quarter reaching 411 transactions, an increase of nearly 69% compared to the fourth quarter of 2023. However, in contrast to the rebound in the number of transactions, the performance of financing amounts was cautious, with the total quarterly financing amounts hovering between 1.8 billion and 2.8 billion USD throughout the year. This indicates that, despite a recovery in capital activity, investors are more conservative in their funding commitments, further indicating the decoupling characteristics of the primary market from the overall market.
From the distribution of market heat, the crypto market in 2024 was dominated by Bitcoin and meme sectors, which is a stark contrast to the performance of the previous cycle. In the previous cycle, VC projects were usually the core of market hotspots, while in 2024, the overall performance of VC projects was lackluster, making it difficult to have a substantive impact on the market. This phenomenon has caused the primary market to lose its value as a reference indicator for the overall market.
The primary market in 2024 exhibited a trend of rationalization and independence. After experiencing the frenzy of 2022 and the winter of 2023, investors are clearly more cautious and more focused on the actual quality and long-term value of projects rather than blindly chasing market hotspots. This change may indicate that the primary market is gradually detaching from the traditional crypto market cycle, entering a new stage of development.
The increase in the number of financing transactions and the cautious approach to amounts reflects VC institutions' tendency to diversify investments and be more conservative in capital allocation. This attitude indicates that the return of market heat has not led to a large-scale inflow of capital but has prompted investors to pay more attention to those projects that truly have potential. In other words, the primary market is no longer just a 'follower' of trends but is beginning to play a role in shaping the future market landscape.
In 2024, the number of financing transactions in the primary market was 1,295, with a disclosed total financing amount of 9.346 billion USD.
According to incomplete statistics from Odaily Planet Daily, there were a total of 1,295 investment and financing events in the global crypto market in 2024 (excluding fundraising and mergers and acquisitions), with a disclosed total amount of 9.346 billion USD, distributed across infrastructure, technology service providers, financial service providers, applications, and other service provider tracks, among which the application track received the most financing, totaling 606 transactions; the infrastructure track received the highest financing amount, with a financing amount of 3.976 billion USD. Both led other tracks in terms of financing amount and number.
From the above chart, it can be seen that the application track, as the area closest to end users in the crypto industry, has always been the focus of attention in the primary market. In 2024, the financing performance of the application track achieved double growth compared to 2023, with the number and amount of financing increasing by about 20% year-on-year.
The financing performance of the infrastructure track in 2024 was particularly eye-catching. The number and amount of financing both increased significantly compared to 2023, with an increase of over 50%. Behind this growth is not only the crypto industry's continuous demand for upgrading technological infrastructure but also the rise of emerging fields such as AI (artificial intelligence) and DePIN (decentralized physical infrastructure networks), bringing new development opportunities to the infrastructure track.
In summary, the investment and financing activities in the global crypto market in 2024 showed distinct characteristics, with the application track and infrastructure track leading in both quantity and amount, indicating a dual demand from the market for end-user experience and underlying technology upgrades. Meanwhile, technology service providers, financial service providers, and other service provider tracks are brewing new opportunities amidst stable development, especially the financial service provider track, which is expected to achieve new breakthroughs in 2025 with the entry of mainstream finance.
The AI sector has shown its strength, with a surge in the number of financing transactions in Q4 of 2024.
According to incomplete statistics from Odaily Planet Daily, financing events in 2024 were concentrated in DeFi, underlying infrastructure, and gaming, with the DeFi track having 289 transactions, the underlying infrastructure track having 236 transactions, and the GameFi track having 160 transactions.
From the distribution of financing situations in sub-tracks:
Looking at the segmented tracks of 2024, DeFi and underlying infrastructure sectors continued to maintain stable growth, with both total financing and number of transactions ranking first. This indicates that the market's demand for decentralized finance and underlying technology remains strong, whether it is the innovation of new protocols in DeFi or the continuous optimization of underlying facilities such as multi-chain interoperability and blockchain security, all of which have become the focus of capital.
In contrast, the gaming sector performed impressively in the first three quarters, consistently ranking among the top three in terms of financing transactions, but faced a significant decline in the fourth quarter, with only 29 projects disclosing financing information. This trend reflects a phase of diminishing enthusiasm for GameFi, with the market becoming more cautious about its short-term profitability and user growth prospects.
At the same time, the heat of the AI sector has rapidly risen, becoming a major highlight of 2024. This track often developed alongside other areas (such as DeFi and infrastructure) in its early stages and was not separately defined. However, starting from the third quarter, the AI sector gradually stood out, especially in the fourth quarter, where both the number and amount of financing doubled. The market has shown high attention to the application potential of AI + blockchain, while the rise of AI Agents has further ignited capital's enthusiasm for investment in this track.
The largest single investment amount was 525 million USD for Praxis.
From the Top 10 list of financing amounts in 2024, it can be seen that despite fluctuations in the market environment, investment institutions still have strong confidence in infrastructure projects. The top ten projects almost all focus on underlying technology and innovation directions, showing institutions' high expectations for the future development of this track.
L1 public chains still attracted large-scale financing. In the list, besides the established public chain Avalanche completing a 250 million USD private placement, emerging projects like Monad, Berachain, and Babylon also showed strong growth momentum. These projects have won investors' attention through technological innovation and ecosystem expansion.
Praxis is the champion of financing in this list, receiving as much as 525 million USD in investment. However, the project's specific development direction remains somewhat vague, mainly because it adopts a DAO organizational structure for management, and entering the DAO requires an application, limiting the disclosure of related information.
It is worth noting that Paradigm's dominant position in the list is obvious. As a top venture capital institution, Paradigm led investments in the three major projects in the list—Monad, Farcaster, and Babylon.
