Crypto VC Funding Down 82% Compared to Last Year
Venture capital funding for cryptocurrency projects has fallen by 82% in Q1 2023, compared to the same period the previous year, according to a Crunchbase report. The decrease in funding is linked to falling valuations and down rounds among companies that secured high valuations in 2021 and early 2022, including Yuga Labs, ConsenSys, Polygon, FTX and FTX US. Only three startups received significant investment in Q1 2023, and only two of those received more than $100m. In response to the changing conditions, companies are pulling back on projects planned to launch under token listings amid falling sales. Potential regulatory factors have also deterred investors from non-Bitcoin and Ethereum cryptocurrency assets. Deep learning modules such as ChatGPT and AI products have become more attractive to venture capitalists due to recent investments. Startups receiving AI investment over the past few months include Character AI and Stability AI. Tron founder Justin Sun has committed to a $100m investment in AI development.
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