The cryptocurrency market has experienced a significant surge in fundraising, with a total of $2.4 billion raised in the first quarter of 2024. The shift in market sentiment and fresh inflows has contributed to this increase in investment activity within the sector, driven by a bull market observed during Q1. Institutional investors have been enticed to pour money into the market following the approval of spot Bitcoin exchange-traded funds by the Securities and Exchange Commission (SEC). Venture capital funds have actively participated in this bullish run, with a total of 518 deals amounting to $2.3 billion closed in the first quarter, reflecting a 40.3% increase in investments compared to the previous quarter.
Noteworthy examples of successful fundraising within the cryptocurrency market include Zama, EigenLayer, and Together AI, which raised $73 million, $100 million, and $106 million respectively. As more institutions venture into the cryptocurrency sector, a multitude of deals are driving increased valuations for various companies. For the second month in a row, crypto venture capital funding has exceeded the $1 billion mark, highlighting continued investor interest in the industry. April witnessed $1.02 billion in funding spread across 161 investment rounds, slightly down from March’s $1.09 billion across 186 rounds, marking the first time since October-November 2022 that the crypto sector has seen two consecutive months of funding surpassing $1 billion.
This surge in investment activity within the cryptocurrency sector has been fueled by the bull market witnessed during Q1, with cryptocurrency values soaring to levels not seen in months. The experts at PitchBook anticipate continued growth in investment activity throughout the remainder of the year. The heightened on-chain activities observed in Q4 2023 have also played a role in driving this surge, marking a substantial leap forward for the sector. Deal volume saw a notable rise of 44.7% in the preceding quarter as asset values increased and market valuations soared, setting the stage for a promising investment climate.
Venture capital funds actively participated in the bullish run witnessed during Q1, with a total of 518 deals amounting to $2.3 billion closed in the first quarter of the year within the cryptocurrency industry, reflecting a remarkable 40.3% increase in investments compared to the previous quarter. The most significant deal of the quarter was Together AI, which raised $106 million, propelling its valuation to an impressive $1.1 billion. As more institutions venture into the cryptocurrency sector, a multitude of deals are driving increased valuations for various companies. April witnessed $1.02 billion in funding spread across 161 investment rounds, slightly down from March’s $1.09 billion across 186 rounds. This marks the first time since October-November 2022 that the crypto sector has seen two consecutive months of funding surpassing $1 billion.
Balance, a digital asset custodian based in Canada, has once again achieved $2 billion in assets under custody (AUC) amid the recent recovery in crypto markets. Korea Digital Asset (KODA), the largest institutional crypto custody service in South Korea, has seen a remarkable growth in crypto assets under its custody, with the value of these assets expanding by nearly 248% in the second half of 2023. This growth in crypto assets under custody highlights the increasing interest and investment in the cryptocurrency sector globally. The cryptocurrency market continues to attract institutional investors and venture capital funds looking to capitalize on the surge in investments and valuations within the industry.
