The crypto industry witnessed a significant uplift in venture capital (VC) interest throughout March, showcasing a 52.5% increase from the previous month. A robust $1.16 billion was funneled into many crypto endeavors, with a pronounced focus on infrastructure and decentralized finance (DeFi) projects. According to a Web3 asset data platform, RootData, this financial engagement resulted in 180 publicly disclosed deals, marking a peak not observed since April 2022.
The investment landscape revealed a diverse array of commitments, with 20% of the transactions ranging between $1 million to $3 million. A slightly smaller fraction exceeded the $5 million mark, reaching up to $10 million. Despite the global nature of these ventures, the United States emerged as a focal point for funding, albeit constituting less than 10% of the total deals.
Highlighting the month’s funding activities was Ethereum layer-2 blockchain Optimism, which topped the charts by securing $89 million through a private token sale. Following closely was the cryptography innovator Zama, which completed a $73 million Series A round. This surge in investment activities represented a 25% increase from February and showcased a staggering 70% growth year-over-year, with a total raised amount surpassing that of March 2023 by 28%.
Andreessen Horowitz (a16z) recently announced a $30 million allocation towards a Web3 gaming fund on April 1. Other notable movements include Marc Andreessen and Galaxy Digital’s contribution to 1kx’s $75 million fund aimed at crypto-based consumer applications and Hack VC’s $150 million initiative for supporting early-stage crypto and artificial intelligence ventures.
Most of March’s VC funding went to infrastructure projects, accounting for nearly $283 million of the total investments. DeFi projects were not far behind, amassing $228.1 million. Centralized finance (CeFi) projects, including exchanges, received substantial support, securing $85.5 million in funds. Notably absent from this month’s funding was the DAO category.
Since November, there’s been a notable uptick in venture capital funding for cryptocurrency projects, with monthly investments surpassing the $1 billion mark for the first time. This trend indicates a renewed trust in the cryptocurrency market. This rebound follows a subdued 2023 in the wake of the FTX collapse, hinting at a revitalized enthusiasm for crypto, partly fueled by the introduction of spot Bitcoin exchange-traded funds (ETFs) in the U.S., as noted by PitchBook.
