There has been an increase in VC investments in the blockchain industry in recent years motivated by the significant technological capabilities and potentially unlimited returns amidst a growing public acceptance and endorsement by many formal and street influencers. According to Bloomberg citing PitchBook, venture capital firms invested a record $30 billion in crypto in 2021. That was nearly four times the previous record of $8 billion in 2018, the report said. Much of that fundraising — about $7.2 billion — came from U.S. venture capital. Venture capital funds around the world are now seeking to increase their stake and exposure in the asset class, with billions of dollars invested via crypto exchanges, digital asset infrastructure providers, virtual assets funds, and digital wallet companies.

Of the money contributed to crypto, 41% went to companies that had either investing, trading, or lending services for digital assets; second place went to NFT, DAO, and Web4 companies at 17% of allocations. The space continues to grow from the bottom up, with 62% of managers that raised money in 2020 also raising money again in 2021, reflecting rapid growth and the heightened demand from investors.

Preliminary data indicates that there are now over 500 venture firms within crypto and blockchain, and this seems to reflect an irreversible maturation of the sector, with many of the early companies that were founded between 2018-2020 now enjoying high levels of recognition and awareness.

Interestingly, KPMG highlights that a significant amount of institutional money flowed into the crypto space, showing the investor base is gaining momentum. Investor awareness and knowledge of the sector is growing, with investors now having a much better understanding not only about crypto assets, but also the operational and procedural side of crypto — from custody and storage to storekeeping and the competitiveness and maturity of service providers.

What makes crypto space attractive to venture investments?

Presumably, first and foremost, it’s their lavish yields in a world that stuck in a near-zero interest rate environment for many years. Next, it’s the lack of complicated regulatory procedures demanding substantial financial resources as well as time to complete only the preliminary no-income bearing phases.

Indeed, VC crypto investment is gaining momentum and the crypto space remains attractive as numerous companies raised $100 million-plus funding rounds, including BlockFi ($350 million), Paxos ($300 million), Blockchain.com ($300 million), Bitso ($250 million) and some others. Recently Taipei-based Web3 investor Infinity Ventures Crypto (IVC) has raised $70 million to launch startups in Asian, South American, and North American markets in its first funding round deal. The focus of the fund is to kickstart and bolster the growth of global GameFi, decentralized finance (DeFi), and Web3 innovations with a key focus on bridging the gap between the markets in East, particularly Southeast Asia, and the West. Notable fundraiser participants included Circle, Digital Currency Group (DCG), and Animoca Brands.

IVC was founded in August 2021 and since then has injected capital and expertise into 78 portfolio companies thus far. With 13 years of experience in traditional venture capital under the sister fund Headline Asia, IVC aims to leverage its global network to empower blockchain startups across the globe, including those in Southeast Asia, Taiwan, Japan, US, and others. “As venture-building partners, IVC is committed to supporting its founders fully, from tokenomics design to cryptocurrency exchange listings.

Who are the top blockchain and cryptocurrency investors?

Digital Currency Group

HQ: New York, NY

Blockchain and crypto deals: 197

Founded in 2015, Digital Currency Group is a VC firm that primarily invests in cryptocurrency, fintech and blockchain companies. The firm has $72 million in dry powder and is interested in making seed stage, early-stage VC and later-stage VC investments. Their recent investments include Circle and Figure Technologies, both of which develop technology to facilitate financial transactions.

NGC Ventures

HQ: Singapore, Singapore

Blockchain and crypto deals: 133

NGC Ventures was founded in 2017 and serves as both an investor and incubator to blockchain and cryptocurrency projects around the world. With $400 million of assets under management, many of the companies they support—like Parami Protocol and ReSource Finance—focus on utilizing blockchain’s potential for decentralization, with use cases such as decentralized finance and decentralized computing.

Coinbase Ventures

HQ: San Francisco, CA

Blockchain and crypto deals: 133

Coinbase Ventures is a VC firm founded in 2018 by the Coinbase cryptocurrency exchange. It specializes in early-stage VC deals and operates almost exclusively in the blockchain and cryptocurrency space. Looking at their activity within these verticals, we see an interest in both crypto exchange technology like CoinDCX and blockchain-based media distribution like Livepeer.

Pantera Capital

HQ: Menlo Park, CA

Blockchain and crypto deals: 130

Founded in 2013, Pantera Capital is a hedge fund with an interest in both blockchain-based ventures and different forms of crypto and digital currency. It primarily targets early-stage VC and seed round deals, and its median round amount is $9.8 million. The firm’s recent investments include Pintu and Vauld, both of which seek to facilitate the exchange of digital assets.

Plug and Play Tech Center

HQ: Sunnyvale, CA

Blockchain and crypto deals: 115

Plug and Play Tech Center is an accelerator firm that has made 3,350+ investments since it was founded in 2006. Unlike most of the other investors highlighted in this list, Plug and Play is also active in a number of industries beyond blockchain and crypto such as supply chain, healthcare, retail and insurtech. Their most recent investments include California-based companies Jerry and Wheel the World.

Fenbushi Capital

HQ: Shanghai, China

Blockchain and crypto deals: 113

Founded in 2015, Fenbushi Capital is a VC firm with a focus on blockchain-based companies. Their investments include companies like Fold, which creates new uses for Bitcoin and ventures like Multiverse Labs, which leverage blockchain to improve resource sharing and app integration.

VRM Ventures

The best form of VC is proprietary, with no community money behind, with a clear plan for investments and long-term vision of the market, coupled with a good portfolio, industrial expertise, and strong network among VCs and exchanges.

For example, VRM Ventures belongs to one of the biggest market makers on the crypto market – VRM. VRM Ventures invests in the following areas – CeFi exchanges, web3, DeFi, Cross-chain solutions, and end-customer-oriented directions NFT and metaverse.

VRM Ventures portfolio includes BitDAO – the world’s largest DAO-directed treasury, BitCoke – the first Quanto Swap Contract exchange, Clear – decentralized derivative protocol, Stars Art – the first DAO-based NFT marketplace.

Among other promising companies and startups in VRM Ventures portfolio is CV Sentio, Deliq Finance, Cronos World, Tap Fantasy, Glitter Finance, Neptune mutual, HTR Group.

VRM Ventures is looking for strong projects with a unique and innovative vision in the crypto space. If you have an innovative idea and need support, send a summary of your project here.