- Venture capital investment in crypto projects reached a record $10 billion globally in the first quarter of 2022, Reuters reports.
- Such projects, ranging from crypto and NFT exchanges to decentralized finance applications and token issuers, are often known as protocols.
- The fear of being left behind is leading the private equity firms to invest in crypto platforms, metaverse and Web3.
- The M&A deals involving crypto target companies also ballooned globally, with 73 deals sealed in 2022 worth $8.8 billion versus 51 deals worth $6.8 billion in 2021.
- Experts saw that investment levels in crypto continued to grow amid a bitcoin price slump in 2022 and another decline last summer, helping crypto firms bag good bargains.
- Reuters notes that in many cases, blockchain tech firms often target brand value of backing from established players and increasing integration with the financial system.
- The trend was demonstrative of investors' disbelief that a prolonged bear market in digital assets is forthcoming and the significant amount of dry powder held by funds seeking to allocate to the sector.
- The VC crypto craze in 2022 also coincided with a slump in the tech-heavy Nasdaq benchmark.
- The full-year VC investment in crypto projects for 2019 was $3.7 billion, $5.5 billion for 2020, and $28 billion for 2021.
