The financing of VC for crypto startups plunged in the second quarter of 2025, marking one of the lowest periods since the end of 2020.
The main dishes to remember:
- Crypto VC funding dropped 59% from qoq to $ 1.97 billion on 378 offers, one of the lowest quarters since 2020.
- The mining has led with more than $ 500 million, while companies in the subsequent stadium captured 52% of total capital.
- The United States has regained domination with almost half of the funds raised, while launching new funds have remained almost five years.
According to data accumulated by Galaxy Digital, VC investments totaled $ 1.97 billion between 378 transactions, down 59% quarterly and 15% less the number of transactions.
The sharp decline follows an inflated Q1, when $ 4.8 billion paid in the sector, almost half of which came from a single injection of $ 2 billion by the MGX fund linked to water sovereigns in Binance. Excluding this aberrant value, the fallout from the Q2 would have been closer to 29%.
Exploitation and infrastructure take the lead
The remarkable category was the mining, which attracted more than $ 500 million, including an increase of $ 300 million by the minors XY minors in an agreement led by Sequoia.
Privacy, security and blockchain infrastructure followed, each segment seeing investments greater than $ 200 million. The increase in mining allowances is linked to the growing demand for calculation power fueled by the rise of artificial intelligence.
In step, companies later captured 52% of the capital, reflecting a change to more mature companies with proven commercial models.
The pre-series activity has remained stable, but its share has gradually decreased in previous cycles, pointing to a start-up landscape.
Geographically, the United States dominated both the capital and the number of transactions, taking 47.8% of the funds and 41.2% of the transactions concluded.
The United Kingdom ranked second with almost 23%, followed by Japan and Singapore. The United States has resumed the advance after Malta briefly exceeded it in the last quarter due to the Binance agreement of MGX.
As for fundraising, 21 new funds focused on cryptocurrency on the crypto closed in the second quarter, raising $ 1.76 billion combined.
The median and median fund sizes have increased above this year, but the overall environment for managers remains difficult, the new statement of funds oscillating almost five years.
The wider macro backdrop continues to weigh on Crypto Venture. The increase in interest rates, a change in the preferences of allocator and the competition of other vehicles such as the ETF spots and the cash companies of digital assets (DATCOS) diverted the institutional flows of startups at an early stage.
Many beneficiaries are now looking for exposure by liquid and regulated instruments rather than venture capital.
The first pure crypto fund rises by almost 1,000%
As indicated, pure crypto, a relatively silent actor in the digital active space based outside Chicago, turned his head after revealing that his flagship fund jumped almost 1,000% since its creation in 2018.
What started as an crypto experience in a traditional wealth management company is now a fund of $ 60 million, supported by a net strategy and family capital.
Founded by Jeremy Boynton, who also manages Laureat Wealth Management, and managed alongside his partner Zachary Lindquist, Pure Crypto has become a fundraising fund on the 100 million dollars crypto.
The duo is now preparing to raise capital for their fourth fund, which, according to them, will lead what they consider as the last wave of Venture style yields in crypto.
“We think it may be the last Hourra to the nature of the venture capital of crypto feedback,” said Boynton.
While the regulations are solidifying, such as the recent Stablée bill, assisted by former president Donald Trump, and large companies explore the integration of digital currencies, they see the days of excessive winnings of the Far West ending.
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