The first quarter of 2024 saw a resurgence in venture capital funding for the crypto sector, marking the end of a two-year downturn.
Data analyst Crypto Koryo observed a 38% rise in investment capital during the initial quarter, accompanied by a 49% surge in the number of funded projects.
Venture capital (VC) funding directed towards the cryptocurrency sector notably increased in the first quarter of 2024, departing from two years of decline.
In a comprehensive report released by data analyst Crypto Koryo on X, the firm highlighted a significant increase in both the total amount of venture capital investments and the number of projects that received funding during the first quarter of 2024, when compared to the preceding quarter in 2023.
The analyst observed a 38% surge in investment funds during the quarter.
Crypto Koryo’s report revealed that the number of projects receiving venture capital funding had skyrocketed by an astounding 49% during the first quarter of 2024, reaching levels that had not been witnessed since the final quarter of 2021.
This indicates a positive trend in crypto VC funding, moving in an upward direction.
Crypto Koryo sees this as potentially heralding “the onset of a new trend.” Crypto Koryo highlighted that the recent surge mirrors the patterns observed in the fourth quarter of 2020, which preceded significant inflows of VC investments into the industry.
Additionally, Crypto Koryo pointed out that in contrast to earlier quarters dominated by banks and non-crypto VCs, this quarter witnessed greater involvement from venture firms specializing in the crypto sector.
Funds invested in the quarter were predominantly contributed by crypto-native VCs such as Andreessen Horowitz Crypto, OKX Ventures, Multicoin Capital, Paradigm, and Polychain.
The tail end of the quarter saw a particularly pronounced increase in VC activity, with over $1.1 billion invested across 180 deals in March, marking a remarkable 52.5% month-on-month surge in investment.
The rise in funding during Q1 2024 builds on the positive momentum observed in Q4 2023.
During Q1 2023, there was a 2.5% uptick in crypto VC investments compared to Q3 2023, representing the first increase in VC investments in crypto projects since March 2022.
In 2022, the crypto industry faced challenges, experiencing a decrease in venture capital funding along with unfavorable market conditions. Throughout the year, there were consecutive quarterly declines in venture capital investments in the sector.
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