According to Reuters, data from PitchBook shows that the funding amount for cryptocurrency startups has risen for the second consecutive quarter, reaching $2.4 billion in the first three months of 2024. This increase in funding is attributed to the expectation of lower interest rates and the launch of the first-ever Bitcoin spot ETF in the United States, which has sparked investor interest.
According to PitchBook’s data, these funding rounds were distributed across 518 transactions, representing a growth of 40.3% compared to the previous quarter. Meanwhile, global venture capital has reached its lowest point in nearly five years. This indicates that startups focused on building cryptocurrency and blockchain technology infrastructure have taken the lead in funding during the first quarter.
PitchBook analyst Robert Le stated, “The revival of publicly traded tokens and the continued increase in institutional adoption will drive the increase in venture capital funding.”
The largest transaction was completed by decentralized cloud platform Together AI, which raised $106 million in early-stage funding led by Salesforce Ventures, valuing the company at $1.1 billion. Together AI had previously announced a Series A funding of $102.5 million in November 2023, led by Kleiner Perkins, with participation from NVIDIA.
Le noted that competition in funding rounds has become extremely fierce, especially in early-stage financing. He said, “This situation is exacerbated by the higher valuations obtained in early-stage funding rounds compared to later-stage transactions. We will see if this trend continues in the coming quarters.”
However, there are still very few exit cases. Le expects merger activity to increase later this year as the market matures, especially between cryptocurrency exchanges, custody providers, and infrastructure providers.
Related report: “Funding in the cryptocurrency market exceeds $1 billion for two consecutive months, the first time since the end of 2022.”
