Cryptocurrency investment growth recorded for the third consecutive quarter
**In the digital realm, the investment landscape of cryptoventures has seen a third successive quarter of volume, yet the number of deals in April-June saw a 12.5% dip compared to the initial three months of the year. This trend mirrors a marked deceleration across the digital assets sector as a whole.
The drop in investor fervor has replaced the optimistic momentum that prevailed in Q1, following the debut of spot ETFs on bitcoin in the US and fresh price records for the leading cryptocurrency. As per Bloomberg's estimation, while the Bitcoin ETFs attracted $13.7 billion in January-March, the subsequent April-June saw a mere $2.8 billion – a staggering 80% decrease.
"Although investor enthusiasm has taken a dip, cryptoventure investments reached a near-frenzy in March and April," Rob Hadi, general partner at Dragonfly Crypto Fund, comments.
Hadi observes a noticeable decrease in the number of deals since market sentiment softened at the end of April, leading to a more measured market stance throughout May.
However, the total funds attracted are expected to escalate this year, predicts Robert Lee, senior analyst at PitchBook. He attributes this growth to the recuperation of cryptocurrency prices and continued institutional acceptance of digital assets.
Interestingly, the record volume of $10.9 billion in cryptocurrency startup venture investments in Q1 2022 resulted from uninterrupted growth for seven consecutive quarters. Subsequently, the indicator plummeted to the lowest figure in almost 2.5 years – $1.9 billion in July-September 2023 – before showing signs of recovery.
Some factors affecting this trend may include market volatility and consolidation, regulatory uncertainty, economic conditions, market sentiment, and capital flows, and on-chain activity. While trading volume decreased, on-chain activity, such as new wallet creation and DApp usage, might have remained robust, offering potential for growth once investor confidence returns.
- Despite the dip in the number of cryptoventures deals in Q2 2022, the total funds attracted in the cryptocurrency sector are expected to increase this year, according to Robert Lee, senior analyst at PitchBook.
- The record volume of $10.9 billion in cryptocurrency startup venture investments in Q1 2022 was the result of uninterrupted growth for seven consecutive quarters.
- Rob Hadi, general partner at Dragonfly Crypto Fund, comments that although investor enthusiasm has decreased, cryptoventure investments reached a near-frenzy in March and April.
- The drop in investor fervor in the digital assets sector, as seen in the reduced number of cryptoventure deals in Q2 2022, mirrors a noticeable deceleration across the sector, and factors affecting this trend may include market volatility, regulatory uncertainty, economic conditions, and capital flows.
