The first quarter of 2024 set a new benchmark for cryptocurrency startups as they bagged a whopping $2.4 billion across 518 individual funding deals.
This dynamic entry into the year marks a strong 40.3% increase in invested capital and a 44.7% jump in deal volume from the last quarter of 2023.
Startups See Skyrocketing Valuations and Deal Counts
According to the latest insights from PitchBook, crypto startups are riding a wave of increased investor confidence that’s likely to keep the momentum going throughout the year.
This optimism is grounded in the recent data showing significant gains in the industry, particularly in infrastructure projects which attracted the lion’s share of funding.
Also Read: VC Funding Flows Back to Professor-Led Crypto Ventures
Notably, Ethereum restaking platform EigenLayer raised $100 million in a Series B round, while the fully homomorphic encryption platform Zama secured $73 million in a Series A round.
The largest investment this quarter was directed towards Together AI, an innovator developing an open-source, decentralized cloud platform.
They successfully raised $106 million in an early-stage round at a staggering $1.1 billion pre-money valuation.
This follows closely on their previous $102.5 million Series A, which was priced at a pre-money valuation of $463.5 million just a quarter earlier.
Infrastructure Startups Capture Major Funding
Together AI stands as a key player in the broader decentralized physical infrastructure network, a sector that continues to be among the fastest-growing in 2024.
This trend is not just limited to individual success stories but reflects a broader increase in valuation across all stages of funding.
In the first quarter alone, the median pre-money valuation for pre-seed/seed stages was recorded at $21.8 million, a staggering 85.5% increase year-over-year.
Early-stage valuations also saw an upward trajectory with a median of $72 million, a 148.3% increase, while late-stage valuations increased by 7.6% to reach $51.1 million.
Expectations Set High for Continued Growth
The competitive field is now fiercer than ever, especially at the early stages of funding, where higher valuations are becoming increasingly common.
Also Read: Vitalik Buterin Shares Plans to Improve Ethereum’s Decentralization
The deal sizes themselves have adjusted to these new valuations, with median investment sizes at $2.7 million for pre-seed/seed, $5 million for early-stage, and $5.8 million for late-stage investments.
These figures reflect increases of 24.9% and 25 % for the earlier stages, respectively, although there is a slight decrease of 9.7% at the late stage compared to the full year 2023.
As PitchBook analysts suggest, without any significant downturns in the market, the volume and pace of investments in crypto startups are likely to sustain or even increase.
This makes the sector one of the most vibrant and watched-over in investment right now, promising an exciting year ahead for both the builders and investors alike.
Cryptopolitan reporting by Jai Hamid
