As per a new research, venture capital companies have invested more than $17 billion in the sector this year, which is more than all previous years put together.
For long, the crypto sector was seen as the polar opposite of conventional venture funding. This was most evident beginning in 2016 and peaking in 2017, when hundreds of Initial Coin Offerings (ICOs) garnered billions of dollars from ordinary people, decentralizing the fundraising sector and removing control from a few ruling classes.
VCs, on the other hand, have ramped up their game and are now financing some of the industry’s largest blockbusters. According to Pitchbook, a private capital markets research organization, VCs have spent $17.2 billion in cryptocurrency in 2021.
This is more than three times their previous year’s investment of $5.5 billion. The previous landmark was $7.4 billion, set in 2018. One company — Bullish Global – garnered over 60% of the $17.2 billion. Bullish Global is an exchange launched by Block.one, the firm behind the EOSIO blockchain and the EOS currency.
To create liquidity on the exchange, the software business committed 164,000 BTC and $100 million in cash. It also secured $300 million for the exchange from key investors. Peter Thiel, a rockstar of Silicon Valley, and Alan Howard, a British hedge fund millionaire, were among them.
Albeit without taking into account the Bullish Global investment, crypto companies were successful in raising $7.2 billion. This is about as much as they received in the previous record year of 2018, when they received $7.4 billion.
This sum is remarkable, especially since it is only for the first six months of this year. Apart from Bullish Global, Ledger has raised the most venture money, with $380 million raised this month. 10T Holdings spearheaded the Series C investment round for the French crypto hardware wallet company.
It put the company’s worth at more than $1.5 billion. Ledger promises to have 1.5 million monthly active users and claims to protect 15% of all cryptocurrencies worldwide.
BlockFi, a crypto lender based in the United States, came in third, amassing $350 million in March at a $3 billion value. The funding round was headed by Bain Capital Ventures, with BlockFi CEO Zac Prince confirming that an IPO is in the works.
BlockFi had over $10 billion in existing debt more than $15 billion in assets at the time. NFT platform manufacturer Dapper Labs received $350 million in VC financing, stablecoin and crypto exchange Paxos received $300 million, crypto wallet Blockchain.com received $300 million, and Mexican crypto exchange Bitso received $250 million.