Surge in Investments for Crypto and Web3 Amidst Bitcoin's Ascendancy

November has marked a significant resurgence in venture capital investments towards cryptocurrency and web3 initiatives. This renewed interest aligns with a substantial rally in the market, highlighted by Bitcoin reaching a new peak for 2023.

Since the onset of November, the cryptocurrency sector has experienced a 25% increase, attracting approximately $340 billion. This influx has reignited venture capitalists' enthusiasm, leading to increased investments in the area.

Increase in Crypto VC Investments Data from DeFiLlama reveals a 52% hike in crypto venture capital funding in November compared to October.

In November, web3 companies amassed $467.6 million, a notable rise from the $307.7 million raised in October.

While November's figures are still lower than the zeniths of the bull market, they represent the highest level of venture capital funding in the past six months.

At the height of market cycles, investments in crypto startups often reached several billion dollars monthly. Contrastingly, the bear market led to a significant reduction, with a low of $283 million recorded in August.

Further Reading: Exploring the Connection Between Venture Capital Investments and Cryptocurrency Market Prices

Blockchain(.com), a cryptocurrency exchange and wallet service, contributed significantly to November's venture funding. On November 15, the company secured $110 million in a Series E funding round. This round was spearheaded by Kingsway Capital in the UK and saw participation from Lakestar , Lightspeed Venture Partners, and Coinbase Ventures.

Another substantial funding event involved Fnality International in mid-November. The fintech company, which focuses on a blockchain-based payment system for wholesale transactions, garnered $95 million in its Series B funding round.

Additional noteworthy funding activities in November included a $20 million raise by cryptography chip manufacturer Ingonyama - Zero Knowledge Proof Hardware Acceleration and a $14 million raise by Superstate , a blockchain investment firm adhering to regulatory compliance.

Other companies such as Matr1x Fire, Blast, and Privy also achieved significant double-digit funding.

Enhanced Financing for Fintech CryptoCarp's data suggests that crypto venture capital funding for the month could exceed $2 billion.

However, this figure is somewhat inflated, as it accounts for debt refinancing and community raises, which do not strictly fall under venture capital. Additionally, it encompasses a wider array of fintech companies, not limited to crypto or web3 firms.

Nonetheless, on December 6, Rob Hadick , a General Partner at Dragonfly , commented on the trend, stating, “VC in crypto is starting to show some of the same signs of previous bull markets. Quicker deals, lighter touch diligence, bidding wars, more focus on friendly governance terms, etc.”