During downturn markets, venture capital investment often slows, although some major crypto and Web3 investments have already been made this year. Investors do not appear to be deterred by regulatory uncertainty and an explicit attack on the sector in the United States.
On April 18, the DeFi investor highlighted some of the year’s largest fundraises in the crypto and Web3 sectors. Some of the industry’s major venture capital firms, including Three Arrows Capital and Alameda Research, have gone bankrupt. “Crisis, on the other hand, means opportunity,” the expert observed.
This year, LayerZero raised $120 million in funding from a16z and Sequoia Capital, among others. The protocol makes it easier to build cross-chain dApps that are interoperable across all main chains. Following its $135 million Series A in March 2022, it was valued at roughly $3 billion.
Scroll ZKP raised $50 million from investors including Polychain Capital and Sequoia at a valuation of $1.8 billion. The project facilitates the creation of Ethereum Virtual Machine (EVM) smart contracts. Eigenlayer, an Ethereum restaking platform, also raised $50 million in a round headed by Blockchain Capital. The protocol allows ETH to be restaked into other networks in order to improve their security and cryptoeconomics.
Fetch.ai, an artificial intelligence-focused crypto protocol, has acquired $40 million in funding from market maker and investment firm DWF Labs. The platform intends to employ AI to automate processes such as transaction execution. Other cryptocurrency and Web3 initiatives that have received venture capital funding this year include social platform Plai Labs, which received $32 million, and streamlined trading platform Sei Network, which received $30 million.
Furthermore, corporations in the cryptocurrency sector are becoming increasingly suspicious of the United States and are migrating eastward to Asia. A number of multi-million dollar funds have also been established to invest in Asian Web3 and cryptocurrency firms. Among these is the $100 million Bitget Web3 Fund, which was unveiled earlier this month.
According to Bitget, the Asia-focused fund aims to “foster a positive attitude toward the digital currency economy and support the development of the web3 environment.”
ProDigital Futures, a Hong Kong investment business, announced plans to invest $100 million in crypto and Web3 startups in the region in late March.
When Hong Kong launches its crypto framework in June, it might become a VC investment hotspot. Large sums of money from mainland China are expected to enter the sector through this legal route.