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Crypto Fundraising Rises to $2.4 Billion in Q1 2024 with Over 500 Offerings
Last Updated: May 19, 2024 3:37am EDT | 2 minute read
The cryptocurrency market has seen a significant increase in fundraising, reaching a whopping $2.4 billion in the first quarter of 2024, fueled by a change in market sentiment and new inflows.
According to a recent PitchBook analysisleading provider of data for private and public market investors, reported a substantial increase in investment activity in the cryptocurrency sector compared to the previous quarter.
The bull market observed during the first quarter played a key role in driving the investment surge.
Cryptocurrency values have risen to levels not seen in months, enticing institutional investors to pour money into the market following the Securities and Exchange Commission’s (SEC) approval of spot Bitcoin exchange-traded funds (ETFs).
VC funds participate in the bull market
Venture capital funds have actively participated in this bull run.
According to the PitchBook report, a total of 518 deals totaling $2.3 billion were concluded in the cryptocurrency sector in the first quarter of the year.
This reflects a notable increase in investment of 40.3% compared to the previous quarter.
Considering the intensification of on-chain activity observed in the fourth quarter of 2023, this surge marks a substantial leap forward for the industry.
Transaction volume or the number of transactions also saw a notable increase of 44.7% in the previous quarter.
As asset values have risen, market valuations have skyrocketed over the course of the year, setting the stage for a promising investment climate.
PitchBook experts expect continued growth in investment activity throughout the rest of the year.
Notable examples of successful fundraising in the cryptocurrency market include Zama, a cryptocurrency company specializing in fully homomorphic encryption (FHE), which raised $73 million in funding.
EigenLayer, another industry player, received $100 million in Series B funding.
However, the most significant deal of the quarter was Together AI, which raised $106 million, pushing its valuation to a whopping $1.1 billion.
As more and more institutions venture into the cryptocurrency space, a multitude of deals are driving valuation increases for various companies.
VC funding surpasses $1 billion for the second month in a row
For the second month in a row, crypto venture capital funding increased has surpassed the billion dollar markhighlighting the continued interest of investors in the sector.
As reported, April saw $1.02 billion in funding across 161 investment rounds, down slightly from March’s $1.09 billion across 186 rounds.
However, it is the first time since October-November 2022 that the cryptocurrency sector has seen funding exceeding $1 billion for two consecutive months.
Earlier this year, Balance, a Canada-based digital asset custodian, revealed this has once again reached $2 billion of assets under custody (AUC) amid the recent recovery in cryptocurrency markets.
Likewise, Korea Digital Asset (KODA), the largest institutional cryptocurrency custodian service in South Korea, has seen notable growth in cryptocurrencies under its custody.
Just recently, the company revealed that the value of these cryptocurrencies is under its custody expanded by almost 248% in the second half of 2023.