Crypto funding is drying up – Bloomberg – RT Business News

Private funding of crypto startups has fallen sharply this year as the industry has been plagued by scandals, bank implosions and regulatory uncertainty, according to data from research firm Bloomberg PitchBook on Wednesday.

Global venture capital (VC) funding of cryptocurrency startups in the first quarter of 2023 was the lowest level since 2020, according to PitchBook. The numbers represent an 80% drop in private venture capital investment from a record $12.3 billion in the same period last year, the data showed.

After the bankruptcy of cryptocurrency exchange FTX, crypto startups faced a difficult fundraising environment. Capitalization of deals has been slow, as cautious investors conduct months of research before making financing decisions.

“It’s not driven by FOMO (fear of missing out) or what other investors are doing.” This was announced by PitchBook analyst Robert Le.

Luca Prosperi, founder of Berlin-based startup M^Zero Labs, echoed his sentiments, saying his company began fundraising talks in October, before FTX collapsed, and eventually secured $22.5 million in funding. moon

The collapse of the largest cryptocurrency exchange “Made investors ask more questions,” – said Prosperi.

Le claimed that there was a decline in crypto funding “not surprising” pointed to the collapse of the Silicon Valley bank as another major obstacle for investors. The lender relied mainly on venture-backed companies and currently “There is still fear about what will happen because the macro environment is still uncertain,” Connected.

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