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Crypto startups received over $2 billion from VCs in Q1

The infrastructure sector maintains its dominance, with 62% of all capital directed to crypto startups being absorbed by it.

Crypto startups received over $2 billion from VCs in Q1

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Crypto startups raised $2.17 billion from venture capital (VC) funds in the first quarter of 2024, according to data from DefiLlama. The VC flow into crypto projects reached $1 billion in March, the largest monthly fundraising since October 2022. However, the amount is still 3% lower than the $2,25 billion raised in 2023’s Q1.

Infrastructure investments dominated Q1, with $1.35 billion destined for projects aimed at building frameworks for crypto, representing 62% of all fundraising done in this period. March saw the most capital applied in this sector by VCs, with over $655 million allocated to infrastructure projects.

Crypto startup Zama made the largest funding round in March, with $73 million raised to give developers tools to tackle data privacy challenges across blockchain and artificial intelligence (AI) use cases. Zama is an open-source cryptography company building Fully Homomorphic Encryption (FHE) solutions.

Decentralized finance (DeFi) projects also gathered attention from VCs resulting in $107 million raised in March, which is more than the $95 million raised between January and February.

Figure Markets, a parent company of fintech Figure Technologies, received $60 million from funds like Jump Crypto and Pantera Capital to deploy a decentralized exchange (DEX). This is the largest DeFi-related funding round of the entire Q1.

Web3 applications fell off considerably in March, with just $3 million received from VCs in two different funding rounds, and reaching $50 million captured in Q1.

On the other hand, the blockchain gaming sector amassed $83 million in total investments in March, surpassing the $72 million received between 2024’s first two months. The largest funding round in March was conducted by blockchain gaming studio Gunzilla Games, which received $30 million to build its battle royale title.

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