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Venture Capitalists Bring Crypto Fever, Stampeding Towards WEB 3.0 -by Ecork

The capital is making a big move on crypto in 2022

Fearing being in the dust, private equity investors are submitting to crypto projects – blockchain-based applications and platforms spread through cryptocurrencies virtual economy of metaverse and Web3.

VC investment in such projects amounted to $ 10 billion worldwide in the first quarter of this year, the largest quarter ever and more than double the level seen in the same period last year, according to data from Pitchbook.

One trick has become a trend: the full-year average for 2019, 2020 and 2021 is $ 3.7 billion, $ 5.5 billion and $ 28 billion.

“You’re seeing a lot of VC investment into a lot of systems because they all believe, as we do, that some of these processes are the infrastructure of the future,” said Steve Ehrlich, CEO of crypto broker company Voyager Digital .

Such services, which can range from crypto and NFT exchanges to dedicated financial instruments and token issuers, are often known as regulations in reference to the rules embedded in their code.

The recent trend differs from the past when investment investment levels focused on tracking the value of bitcoin, although with a short delay, according to Alex Thorn, head of firmwide research at blockchain Galaxy Digital in New York.

Investment levels in crypto continued to grow during the bitcoin price hike this year – down about 16% – as well as during another decline last summer, Thorn notes.

“This combination is a reflection of the skepticism of investors that the bear market is in the digital assets coming, as well as the significant amount of dry powder generated by the funds seeking to divide the sector,” he wrote. last week.

Craze VC crypto in 2022 has also coincided with a decline in the Nasdaq technology of commodity technology, which is below 21%.

Crypto Average (2016-YTD) https://graphics.reuters.com/CRYPTO-INVESTMENTS/byprjnezxpe/chart.png

VC PADE WEB3

A number of M&A deals involving crypto-currency companies are also ballooning internationally as noise is growing around the size of virtual worlds and Web3 decentralized online utopia.

73 contracts are sealed until 2022 with an average turnover of $ 8.8 billion, according to Dealogic, compared to 51 transactions worth $ 6.8 billion for the entire past year.

Chicken funding means crypto companies can afford to be picky, said Mildred Idada, founding partner at blockchain investor and accelerator Open Web Collective.

“The founders are saying,‘ There are five currencies you want to invest in us, which one will bring us the most value? ’,” He said.

In many cases, blockchain technology companies are interested in the sheer amount of support from established and integrated artists with the financial system, Idada adds.

Some companies have been creative in how they raise money. For example Polygon, an altar for development and upgrading applications on the Ethereum blockchain, raised $ 450 million in February through the private sale of its cryptocurrency to investors with SoftBank’s Vision Fund 2.

“The main purpose of that promotion is to get companies on our side and increase the visibility of Polygon,” said co-founder Sandeep Nailwal.

However the door of the traditional business investors who embrace red carpet care into online developed areas pushing for renewal is not without cultural hazards.

Many deep-seated capitalists find that they are forced to look at those development areas behind the scenes, according to Alexandra Bertomeu-Gilles, risk manager at DeFi’s finance division.

“Some founders now… when they take money from investors, they create contracts so that investors do not have too much control over the management of the company, or they can not terminate something that many the rest died. the community wants, ”he said.

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