While everyone else seems to be obsessed with memecoins and generally what seems to be the start of a bullish market, at least for three months, tops?
I don't really know, I got bored about “bullrun” conversations because everyone started selling the dream way too early.
I, however, have been running around trying to study something a lot of people hate, at least on Hive the general sentiment to things like this is - bad.
VCs and Crypto Funding
According to data from Cryptorank, Crypto VCs poured over $2.46 billion into crypto projects in October, 2024.
This is the biggest funding month this year, in terms of USD sum raised.
111 projects were funded, and most of the funding for the month seems to have happened within a week, over $2 billion, within Oct 14-20.
As seen in the chart above, October was the biggest month throughout the year.
After a closer look at the data, I needed to know exactly what was being funded that caused this spike and it appears that Stripe’s acquisition of Bridge for $1.10 billion is a piece of this data.
That said, VCs seem to be majorly funding “Blockchain Infrastructure and Services” projects in the last 6 months, even in the biggest month and week of funding, most projects that receive funding were either building a blockchain service or infrastructure.
On this note, I could argue that VCs are majorly after securing tokens that they can eventually dump for profit.
Of a surety, their allocations are typically vested over a period of time, but this does not expose what amount of influence is associated with these fundings.
That said, when it comes to DeFi, VCs seem a bit skeptical with that one, despite funding a lot of DeFi projects over the year, said category usually receives lower funding amounts, usually under $20 million, lots of funding fell under $10 million from the public data.
So, there's essentially a pattern here, so in case anyone was wondering why DeFi has underperformed over the years, it's because VCs are not betting big on them.
Matter of fact, VCs are increasingly funding CeFi projects, YellowCard for example recently received $33 million in October.
I mean, if you look at the train of crypto events over the years, you kind of understand why. These are centralized businesses, so there's a real-world risk factor in relation to regulations.
Even GameFi has recently received a great deal of funding, these are all “consumer-facing” projects, just as DeFi is, but the difference is that one builds heavily on decentralization, the rest functions on traditional-style business models.
Take stablecoins for example, this has also recently received a great deal of attention, I mean, with the kind of revenues being reported by Tether, you can't blame VCs for wanting to look that way.
These funding amounts generally don't end up within the cryptocurrency ecosystem, most of these amounts raised are used externally, but they create internal hype only to steer up excitements for VCs to eventually leverage and exit.
If you study the data long enough, you'll see a pattern, and it's working so far for them.