In the second quarter of 2024, cryptocurrency startups raised $2.7 billion in venture capital funding, according to a report released by Pitchbook on August 9.
This amount marks a slight increase over the $2.6 billion secured in the first quarter, despite a 12.5% decrease in the number of deals completed.
The Pitchbook report, which provides an in-depth analysis of the cryptocurrency and venture capital landscape for Q2 2024, highlights that while the total funding grew by 2.5%, the number of deals fell to 503. The increase in funding despite fewer deals suggests that deal sizes were generally larger during this period.
Pitchbook’s analysis also touches on investor sentiment, predicting a positive outlook for the remainder of the year. “With positive investor sentiment returning to the crypto market, and barring any major downturns, we anticipate that the volume and pace of investments will continue to rise throughout 2024,” the report states.
Notably, the largest funding rounds in Q2 2024 were led by several key players: Monad, a parallelization Layer 1 platform, raised $225 million in Series A funding; Berachain, a DeFi-specific Layer 1 platform, secured $100 million in Series B funding; and Babylon, a bitcoin restaking platform, raised $70 million in an early-stage round.
Additionally, Farcaster raised $150 million in Series A funding at a $1 billion valuation, and Zentry, a blockchain-based gaming platform, obtained $140 million in early-stage funding.
Despite these significant investments, overall funding for crypto startups has decreased markedly compared to the highs of 2021 and 2022. In 2021, crypto startups garnered $25.3 billion in funding, which grew to $29.4 billion in 2022. Last year, however, investment dropped to $10.1 billion, with 2024 currently at $5.4 billion after the first half of the year.
Key investors in pre-seed and seed rounds for Q2 2024 included Dragonfly Capital, Founder’s Fund, and Signum Growth Capital. For early-stage deals, leading investors were Paradigm, Bullish Capital, and Polychain Capital.
The report also notes that while valuations have increased for seed and early-stage funding, they have declined for late-stage investments.
