Despite ongoing attempts by the US government to scrutinize the crypto industry, venture capital investments in the sector continue to surge. During the first quarter of 2023, the crypto and blockchain industry received a substantial investment of $2.4 billion globally.
Investments Trends
In 2019, there was a noticeable trend of corporate venture capital investments in crypto and blockchain startups, with a staggering $850 million being invested. Despite the volatility of the crypto market, investors remain optimistic about the industry’s potential for growth and innovation.
The US government’s stance on crypto has been somewhat ambiguous, with some officials expressing support for the industry while others have been more critical towards crypto. The SEC has taken action against initial coin offerings (ICOs) and other crypto-related activities, and the IRS has provided guidance on how to report crypto transactions for tax purposes. Nevertheless, some lawmakers have proposed bills aimed at providing the crypto industry with more clarity and regulatory certainty.
Noteworthy Venture Capital Investments
LayerZero, a decentralized protocol designed to enable the creation of cross-chain dApps, has recently secured an impressive $120 million in funding. Renowned investors such as a16z and Sequoia Capital have contributed to this funding round.
In March 2022, LayerZero’s Series A funding round raised an astounding $135 million, bringing the company’s valuation to approximately $3 billion. Additionally, Scroll ZKP, a project that specializes in enabling Ethereum Virtual Machine (EVM) smart contract development, has secured $50 million in funding. Investors such as Polychain Capital and Sequoia have contributed to this funding round, valuing the project at $1.8 billion.
Eigenlayer, a noteworthy platform for Ethereum restaking, has recently announced that it has successfully raised a substantial amount of funding, totaling $50 million. Blockchain Capital led the funding round, which is a testament to the platform’s unique solution that allows ETH to be restaked into other networks.
Meanwhile, Fetch.ai, an AI-focused crypto protocol, has also raised $40 million from DWF Labs, a reputable market maker and investment firm. Fetch.ai aims to leverage artificial intelligence to automate tasks, including the execution of transactions. Other successful fundraising projects in the crypto and Web3 space this year include Plai Labs, a social platform that raised $32 million, and Sei Network, an optimized trading platform that secured $30 million in VC funding.
