Crypto Startups Raised $2.7B in Q2, a 2.5% Increase QoQ But an 8.8% Drop YoY: PitchBook

Crypto startups attracted $2.7 billion in venture capital (VC) during the second quarter of 2024, according to PitchBook data.

Crypto venture capital (VC) investment hit $2.7 billion in Q2 2024, up 2.5% from Q1 but down nearly 10% from last year, PitchBook data shows.

As reported by Bloomberg, this comes as the digital asset market faced challenges following earlier highs, which were largely driven by the launch of Bitcoin exchange-traded funds (ETFs) in the US. Bloomberg estimates reveal investor inflows into these ETFs plummeted by 80% in Q2.

“While VC investment in crypto peaked in March and April, activity slowed as the broader market turned negative in late April and May,” Rob Hadick, a partner at Dragonfly crypto venture fund, told Bloomberg.

However, some analysts are optimistic about future fundraising, citing potential improvements in token prices and institutional adoption.

“The rise in project valuations reflects founders attempting to capture a more optimistic secondary market,” Jason Kam, founder of Folius Ventures, told the outlet.

Investment continues to focus on infrastructure projects, with VCs showing caution toward consumer applications. Only one major funding round for a crypto application was recorded in Q2, highlighting a shift towards application-based investments.

Meanwhile, exit activity reached its highest level since early 2022, with 26 exits reported, signaling ongoing consolidation in crypto exchanges and infrastructure providers.

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