Enthusiasm for encryption venture capital financing has cooled, but quality projects still attract funding.

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Encryption Venture Capital Financing: Challenges and Opportunities Coexist

In the second quarter of 2023, cryptocurrency startups continue to face severe challenges in financing. Although mainstream crypto assets like Bitcoin and Ethereum have rebounded this year, venture capital enthusiasm for the industry has significantly cooled. Data shows that the amount of venture capital financing related to cryptocurrencies has decreased by nearly 98% year-on-year, reaching a new low in recent years.

Liquidity tightening, strong regulation coming, do encryption venture capitalists still care about cryptocurrencies?

The deterioration of this financing environment is partly due to the overall sluggishness of the encryption industry and partly related to the tightening regulatory environment. The U.S. Securities and Exchange Commission's regulatory stance on certain encryption assets has made investors more cautious about the private placement market. In particular, the compliance of common financing tools such as "token warrants" has been questioned, further dampening investment enthusiasm.

Nevertheless, some high-quality projects successfully secured funding. In June, several encryption startups announced substantial funding amounts:

  1. Mythical Games raised $37 million in funding. The company is a comprehensive Web3 game studio, and its game "NFL Rivals," developed in collaboration with the NFL, has performed well on the App Store's sports game chart.

  2. Layer 2 solution Taiko secures $22 million in funding. Taiko is committed to developing a fully Ethereum-compatible zkEVM Layer 2 while maintaining a high degree of decentralization.

  3. The DeFi protocol Maverick secured $9 million in funding. Maverick innovatively improved the AMM mechanism, providing a more efficient liquidity management solution for institutional and retail providers.

Liquidity tightening, strong regulation coming, do encryption venture capitalists still care about cryptocurrencies?

These successful cases indicate that despite the challenging overall environment, high-quality projects can still receive funding support. Venture capital institutions are more cautious, but they are still actively seeking potential encryption innovations. In the future, as the market warms up and regulations become clearer, encryption venture capital financing is expected to gradually regain vitality.

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DataBartendervip
· 4h ago
How tragic, right? 98
View OriginalReply0
YieldHuntervip
· 5h ago
technically speaking, 98% drop is actually bullish af
Reply0
GateUser-bd883c58vip
· 5h ago
It's time to get close to winter.
View OriginalReply0
BanklessAtHeartvip
· 5h ago
The Bear Market has completely cleared out.
View OriginalReply0
MevShadowrangervip
· 5h ago
98%! It's going to be a disaster!
View OriginalReply0
AirdropHunter420vip
· 5h ago
Where did all the money go? 98% is too exaggerated.
View OriginalReply0
AirdropHarvestervip
· 5h ago
Okay, just look at the headlines and slide away.
View OriginalReply0
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