Crypto Funding Plunges 91% in January (compared to last year)

February 7, 2023 Blockchain, Crypto, Digital Assets, Tokens, CBDCs, Metaverse, NFTs, FinTech and Alternative Finance, Fundraising, Investing, Trading, Research, Venture Funding and Building, Web3, Decentralization, DAOs No comments

CoinDesk | Brandy Betz | Feb 2, 2023

Image: CoinDesk, January 2022 vs 2023

Analysis shows crypto startups only raised $548 million last month (January 2023) plunging 91% year over year.

Venture capital (VC) and other investments in privately held crypto startups amounted to $548 million last month, a huge drop from $6 billion in January 2022, according to data compiled by CoinDesk.
- The number of transactions shrank to 62 from 166, and most of the 2023 deals were for smaller, early-stage companies.

See: FT Partners Jan 2023 Blockchain and Crypto Market Update Report

Funding rounds can take months to finalize or close, and some of the investments reflected last month were likely already raising money when the FTX collapse started in early November. The coming months will show exactly how much investment capital dried up after the FTX scandal came to light.
FTX’s demise created doubts about the whole centralized exchange (CeFi) model of trading crypto, and persuaded some that decentralized finance (DeFi) and decentralized exchanges (DEX) are the better way forward.
- CeFi deals sinking 99% to $22.8 million in January 2023. Also, the CeFi firms that managed to raise money had a tie to DeFi.

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