Venture capital investment in the crypto sector is declining, both in terms of the amount raised and the frequency of deals. The latest data from April shows that instead of a wide spread of smaller investments, there are fewer but much larger funding rounds.
According to Cryptorank, there were 94 deals in April totaling $2.37 billion. That’s a steep drop from the 140 deals in March, which brought in more than $5 billion. Among these, Dao5 stood out with an unannounced round reportedly worth $222 million. These numbers are starting to resemble some of the slower periods during the 2022–2023 downturn. In comparison, April 2024 saw 170 total deals across the market but raised just $1.7 billion.
More funding is now going into late-stage and strategic rounds, while investor interest is shifting from trendy areas like Web3 and AI toward developer infrastructure and foundational tools.
Historically, VC activity has followed market sentiment. In bull runs, startups find it easier to raise money, riding the wave of hype and expectations of soaring token prices. But that dynamic has changed. Investors are more cautious now, especially as token liquidity dries up and early investors offload their holdings. Adding to the challenge, getting tokens listed on major exchanges has become tougher due to market saturation.
Some projects are sidestepping these issues altogether by launching meme tokens. These don’t have to meet regulatory requirements or deliver a clear use case, which simplifies things for their creators.
At the same time, international fundraising is gaining ground. Over the last year, a growing number of deals with undisclosed locations have started to rival U.S.-based investments. Even though U.S. crypto regulations have reportedly improved, funding is drifting overseas. So far in 2025, projects with no specified base have raised nearly $5 billion. Malta came next with $2 billion, while the U.S. ranked third with $1.85 billion.
Venture capital firms are also becoming more cautious, favoring projects that have working products or choosing to avoid tokens altogether. This helps them avoid inflation issues and sky-high valuations. Coinbase Ventures is currently leading in deal activity with 24 investments this year, pushing past Animoca Brands, which completed 18.
While some regions like the Eurozone and Canada saw a slight uptick in activity in April, others like the U.S. experienced a drop. With fewer new VC-funded projects, the crypto industry is now looking to breathe new life into previously hyped tokens. But despite some success stories, many investors remain hesitant to commit for the long haul, wary of another drawn-out bear market.
Crypto industry firms like Bit Mining Ltd. (NYSE: BTCM) will be watching these shifts in VC funding to analyze whether they signal changes to the trajectory of the industry or they are just transient investor sentiments.
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