Article sourced from: Blockchain Simplified.
Author: Yogita Khatri, Venture Capital.
Translation: Blockchain Simplified.
According to funding dashboards from (The BlockPro), crypto venture capital funding increased by 28% year-on-year in 2024, reaching approximately $13.7 billion. Despite significant progress compared to 2023, this growth has not returned to previous peaks, even though market sentiment this year is very bullish.
Looking ahead to 2025, top crypto venture capitals maintain a cautiously optimistic view. While most believe funding levels are unlikely to return to the highs of 2021-2022, there is a clear consensus that startups with strong product-market fit and visible user adoption will be most likely to attract capital in the coming year.
The following are the 2025 funding outlooks shared by leaders from companies like Dragonfly, Pantera, Mult1C0in, Coinbase Ventures, BN Labs, and Galaxy Ventures with (The Block).
1, Dragonfly: Betting on DeFi, CeFi, stablecoins, and other areas.
Dragonfly's general partner Rob Hadick told (The Block) that he expects significant growth in crypto venture capital funding in 2025, driven by factors including a relaxing regulatory environment in the US, potentially sustained increases in token prices, and increased institutional capital. However, Hadick believes that funding levels will not return to the highs of 2021-2022 for a 'long time,' reflecting a cautious attitude among venture capitalists to avoid repeating past mistakes.
Dragonfly will continue to focus on supporting founders who excel in areas with proven product-market fit, including decentralized finance (DeFi), scaling platforms, centralized finance (CeFi), and stablecoin/payments. Although emerging areas like crypto artificial intelligence and decentralized physical infrastructure networks (DePIN) are also on their radar, Hadick believes these are still in the 'experimental' stage.
Conversely, Hadick stated that as the focus shifts to emerging industries, investments in categories such as security, tokenization, and interoperability may decline. He also predicts that decentralized social media will face challenges due to a lack of scalability and product-market fit.
2, Pantera: Bullish on crypto-AI, DePIN, and new Layer 1 blockchains.
Pantera Capital's general partner Lauren Stephanian told (The Block) that due to investors being more willing to deploy capital with a US government supportive of crypto, crypto venture capital funding is expected to grow in 2025.
However, Stephanian mentioned, 'The bull market won't last forever,' so it remains to be seen 'when investment deployment will start to slow down in the coming year.'
Pantera will continue to make extensive investments in the crypto and blockchain space but is particularly optimistic about crypto-AI, decentralized physical infrastructure networks (DePIN), and new Layer 1 blockchains that support more application layer functionalities.
3, Mult1C0in: Continues to be optimistic about the Solana ecosystem.
Mult1C0in Capital's current focus is on expanding its investments in decentralized finance (DeFi) applications, particularly within the Solana ecosystem. This year, key on-chain metrics for Solana have outperformed those of Ethereum and its Layer 2 ecosystem. 'We expect this trend to continue, with applications and protocols on Solana becoming big winners in the next cycle as more users, capital, issuance, and activity migrate to Solana's ecosystem,' Kyle Samani, co-founder and managing partner of Mult1C0in Capital, told (The Block).
Samani believes Ethereum will continue to face difficulties and may even enter a prolonged decline, as it is facing fierce competition from Solana and other faster, cheaper blockchains. 'Unless Ethereum can catch up, developers, users, and capital will migrate to other chains that better meet their needs,' he added.
In addition, Mult1C0in is also optimistic about stablecoins. Samani described stablecoins as 'one of the greatest technological and financial innovations of our lifetime.'
'Stablecoins have the opportunity to become an undeniable force in 2025,' Samani stated. 'The world wants dollars, and stablecoins are the most efficient way to get dollars. Their design space is extremely broad, and we are still in a relatively early stage of the adoption curve.'
4, Coinbase Ventures: Focused on the on-chain economy.
Coinbase Ventures head Hoolie Tejwani told (The Block) that the institution is expected to be 'very active' in 2025 and beyond, capable of seizing market opportunities. The company is optimistic about regulatory progress in the US, especially due to the Trump administration's support for cryptocurrency and the pro-crypto Congress set to take office in January 2025.
Tejwani stated that Coinbase Ventures will continue to make extensive investments around the on-chain economy, guided by 'the places where the best and most talented builders spend the most time and energy.' The company is optimistic about the application layer, believing that as infrastructure matures, applications with internet-scale potential will finally become possible. Areas of focus include stablecoin payments and finance, the intersection of crypto and artificial intelligence, on-chain consumer applications (such as social, gaming, and creator applications), and DeFi innovation.
At the same time, Coinbase Ventures has not completely abandoned investments at the infrastructure layer, as there are still unresolved challenges and new opportunities in the tools space, Tejwani added.
5, BN Labs: Prioritizing fundamentals and user adoption.
As a $10 billion venture capital and incubation arm under BN, BN Labs is a 'evergreen' investor. Regardless of market cycles, the company will continue to support Web3, artificial intelligence, and biotechnology startups, its investment director Alex Odagiu told (The Block).
BN Labs expects crypto venture capital funding to maintain strong momentum in 2025 but will remain 'focused on fundamentals' rather than price fluctuations or market hype. Odagiu emphasized that projects with real-world applications, product-market fit, excellent teams, and sustainable revenue models are most likely to succeed.
6, Galaxy Ventures: Optimistic about stablecoins and tokenization.
Galaxy Ventures is optimistic about the growth potential of stablecoins and tokenization in 2025. The company's partner Will Nuelle told (The Block) that stablecoins, especially in the payments sector, show strong product-market fit and remain a focus area for capital deployment.
Despite the slower adoption of tokenization compared to stablecoins, Nuelle believes it holds great potential for investors. Galaxy Ventures plans to explore these opportunities further. However, Nuelle is relatively pessimistic about metaverse-related projects, predicting that due to a lack of clear adoption signs, funding in this area will lag in 2025.
7, Hashed: Cautiously optimistic about 2025.
Hashed's CEO and managing partner Simon Seojoon Kim holds a cautiously optimistic view of 2025. He stated that despite Trump's comments about considering Bitcoin as a US financial asset suggesting a potential shift in institutional sentiment, funding levels are unlikely to return to the peaks of 2021-2022. Kim added that if macro or political 'black swan' events occur, this situation could change significantly.
Kim pointed out that key drivers for 2025 may include clarity in the US regulatory framework, increased institutional activity in Asian markets, and advancements in infrastructure supporting real-world applications. However, he also warned that regulatory setbacks, macroeconomic uncertainty, and geopolitical tensions could suppress growth.
Hashed's investment priorities for 2025 include data infrastructure, institutional-grade DeFi applications, regulated stablecoin payment systems, and crypto and artificial intelligence infrastructure. Kim believes these areas have clear product-market fit, compliance paths, and reliable revenue potential. In contrast, he expects funding for GameFi projects lacking sustainable economic models, undifferentiated Layer 1 and Layer 2 protocols, consumer-grade DeFi applications in restricted regions, and NFT platforms without clear utility or revenue models to decrease.
Hashed plans to complete the fundraising for its third venture fund in the first quarter of 2025 and launch a new investment tool in Abu Dhabi to facilitate direct token investments within the region's regulatory framework. He stated that this strategic expansion aims to address the issue that existing Korean domestic funds cannot make direct token investments due to local regulations, though he did not disclose the target fund size.
8, HackVC: Betting on crypto with artificial intelligence, infrastructure, and DeFi.
Hack VC co-founder and managing partner Ed Roman told (The Block) that unless a black swan event occurs, crypto venture capital funding is expected to 'grow significantly' in 2025. Roman attributes this to pro-crypto government policies and a rekindled enthusiasm among Web3 entrepreneurs.
HackVC primarily focuses on three areas: crypto with artificial intelligence, infrastructure, and DeFi. Roman mentioned that due to GPU-based decentralized physical infrastructure networks (DePINs), the crypto space offers unique opportunities in multi-layer AI stacks compared to traditional Web2 clouds. 'This is a trillion-dollar market serving Web2 clients,' he stated.
In terms of infrastructure, Hack VC is optimistic about scalability protocols, modular infrastructure, Web3 security, maximum extractable value (MEV) improvements, and account abstraction technologies. These innovations significantly enhance the Web3 tech stack and improve user experiences for decentralized applications (dApps).
In the DeFi space, HackVC believes that now is a 'once-in-a-generation opportunity to streamline the financial system.' Roman views stablecoin-based payments as the foundation of this system, with broad real-world application potential, representing 'a trillion-dollar market.' However, he is less optimistic about NFTs, predicting that most NFTs will depreciate, with only top-tier assets able to retain value.
9, Portal Ventures: Supporting integrated platforms.
Evan Fisher, founder and managing partner of Portal Ventures, expects the 'animal spirits' of the market to return in 2025, but funding levels will not return to the highs of 2021-2022, as the macroeconomic environment during those years was unique.
Fisher told (The Block) that Portal Ventures is bullish on platforms that provide both infrastructure and applications, as these platforms can control user experience and build practical scenarios. However, he predicts that investment in heavier infrastructure projects (such as zero-knowledge development platforms and middleware) will slow down due to a lack of clients and sustainable business models.
10, Blockchain Capital: Focusing on multiple areas, including stablecoin infrastructure and DeFi.
Blockchain Capital's partner Kinjal Shah expects funding levels to rise in 2025 as the market remains strong. However, she believes that funding sizes will not return to the highs of 2021-2022, as the hype during that time was influenced by broader macroeconomic trends.
Blockchain Capital will continue to maintain opportunistic investments, focusing on stablecoin infrastructure, innovative distribution models, and DeFi platforms that connect institutional and retail users.
