Crypto Fundraising Dips to a 3-Year Low Amidst Capital Challenges: Messari Report

In a recent analysis by blockchain intelligence firm Messari, the cryptocurrency industry experienced a notable downturn in fundraising activities during the third quarter, marking the lowest levels observed in three years.

Throughout Q3, crypto companies secured just under $2.1 billion in funding across 297 deals. These figures signify the lowest recorded since the final quarter of 2020, as outlined in Messari's recently released "State of Crypto Fundraising" report.

In comparison, the industry witnessed a peak in the first quarter of 2022, with nearly $17.5 billion raised across over 900 deals. However, returns steadily declined over the course of the year, ultimately leading to the abrupt collapse of the FTX exchange in November.

On a positive note, fundraising activity maintained a consistent pace in both the first and second quarters of 2023. Approximately $7.5 billion was raised across roughly 200 deals in each of these quarters, aligning with the figures from the fourth quarter of 2022. Nevertheless, both the number of deals and the total funding experienced a 36% decline in Q3.

Messari also highlighted a notable shift in investor focus towards making new investments in early-stage projects and infrastructure, indicating a shift away from a primary focus on user-facing applications. This shift underscores a broader trend within the crypto industry toward supporting foundational elements and emerging technologies.

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