Crypto VC funding hit 2 times the lowest, US companies are still Galaxy Research’s favourites
Despite the macroeconomic headwinds, a Galaxy Research report says efforts could recover in alternate quarters of 2023 following the recent rise in crypto prices.
Adventurous commercial investment into crypto firms continued to fall in the first quarter of 2023 — and despite the current non-supervision turbulence for crypto in the United States, the country is still the first to number of companies raising capital, according to a new report.
An April 11 report from Galaxy Research, the exploration arm of crypto investment foundation Galaxy Digital, said the $2.4 billion invested by VCs during Q1 2023 was the smallest amount invested since the last quarter of 2020.
VC investments have fallen since reaching nearly $13 billion in Q1 2022, with the most recent quarter’s results showing a drop of more than 80% compared to last time out.
The report notes that data on adventure deals is often reported at a later time, meaning the $2.4 billion figure quoted could be revised in the future.
While capital investment has fallen since Q4 2022, the report notes the number of deals actually made has increased by nearly 20 and theorizes a clear correlation between crypto prices and invested capital could see VCs rebound after strong price gains late in the first quarter.
While colorful statistics and anecdotal evidence show that crypto companies are leaving the US. for countries offering less non-supervision clarity and more task-friendly programs, Galaxy determined that US-based companies increased 42.8% of rich VC flowing into crypto in Q1 2023, with the closest is France at 19.4.
While the Galaxy report has included investment authorities since the third quarter of 2022, the US share of crypto VC investments has fallen by only 2.8 opportunity points since then.
France appears to be the biggest winner, with capital investment for French-based crypto firms surging to 19.4 in the most recent quarter, from a lower than 5 in the third quarter of 2022.
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