The first quarter of 2024 is coming to a close, and there are positive signs of a renewed interest in cryptocurrencies, thanks to the introduction of Bitcoin exchange-traded funds (ETFs) in January.
This improved sentiment in the market could potentially lead to increased venture capital investment after a period of decline. According to a report from Galaxy Digital, venture capital firms in the crypto and blockchain industry raised $5.75 billion across 58 funds in 2023, which was a significant decrease from the record-breaking year of 2022 where $37.7 billion was raised across 262 funds.
However, there were signs of recovery in the last quarter of 2023, with venture funding reaching $1.9 billion, a 2.5% increase from the previous quarter. This marked the first time that venture capital investments in crypto startups had grown since early 2022.
One of the factors attracting investors is the development of solutions that combine artificial intelligence and blockchain technologies. Additionally, there has been a focus on products that cater to institutional investors entering the crypto space.
In March, several startups secured significant funding. Utila, an enterprise-focused wallet provider, raised $11.5 million in seed funding from investors such as NFX, Wing VC, and Framework Ventures. Utila offers a self-custody wallet platform for institutional investors, supporting various chains including Bitcoin, Ethereum, and Solana.
Synnax, a startup focused on credit intelligence in the digital asset industry, raised $1 million in pre-seed funding. The funding round was led by No Limit Holdings and will be used to develop Synnax’s platform, which aims to establish an unbiased credit rating standard for the transition to blockchain technology.
Sahara, a startup focused on decentralized AI networks, raised $6 million in seed funding. The funding round was led by Polychain Capital and included investors such as Samsung Next and Matrix Partners. Sahara facilitates the creation of autonomous Knowledge Agents and offers data services for AI model training with a focus on privacy and security.
Mirana Ventures purchased $8 million worth of Toncoin, the native token of The Open Network (TON), a blockchain project founded by Telegram’s team. This investment is part of a partnership between the TON Foundation, Bybit, and the Mantle Network. Bybit has been incorporating Toncoin into its offerings, while TON Space, Telegram’s self-custodial wallet, is integrating with Mantle Network.
UXLINK, a Web3 social platform, secured nearly $10 million in funding from investors such as OKX Ventures and Web3Port Foundation. UXLINK aims to create a social network platform that emphasizes two-way interactions and includes features such as a decentralized exchange and a reward module for users.
Finally, Ethereum layer 2 network TEN raised $9 million in a funding round led by banking consortium R3. The platform, developed by Obscuro Labs, combines optimistic rollups and zero knowledge rollups to offer an encrypted layer 2 solution for developers. TEN is set to be released on the mainnet in October with features like programmable encryption and immediate bridges.
Overall, these funding rounds indicate a growing interest in crypto and blockchain startups, and the positive market dynamics could lead to increased venture capital investment in the coming months.