Crypto VC funding slowed abruptly in April, following the heightened activity in March. The profile of deals is also shifting, with more private rounds.
VC funding for crypto startups is slowing down, both in terms of value and the number of deals. April’s results reflected a shift in funding, where a handful of large-scale deals replaced the previous landscape of varied deals and a multitude of startups.
In April, Cryptorank counted 94 funding deals valued at $2.37B. The previous month saw a bumper crop of projects, with 140 deals valued at over $5B. The number of deals is comparable to some of the slow months of the 2022-2023 bear market.
In April 2024, the market saw a total of 170 deals, though only valued at $1.7B. For the past month, the undisclosed round of Dao5 was among the most prominent deals, valued at $222M. Strategic and late-stage rounds became more common. VC backers abandoned hot topics like AI and Web3, moving into developer tools and infrastructure.
VC funding decouples from crypto market trends
In previous market cycles, VC funding has been an indicator of the overall investor hype. During bull markets, it is much easier for startups to gain funding, with the expectation of a liquid market and a rapidly appreciating token.
The path of VC funding was met with more skepticism as the available liquidity for tokens diminished. Insider selling also kept investors away from VC-backed projects. Additionally, securing listings is becoming more difficult due to an oversupply of tokens.
Some projects also choose the path of creating a meme token, doing away with the complexities of security law. Meme tokens also do not oblige the project to provide utility, staking, or other use cases.
VC funding shifts to global rounds
In the past year, undisclosed international funding rounds challenged the leading position of the US market. Despite the reportedly improved US crypto regulations, fundraising shifted to other locations.
In the first four months of 2025, undisclosed location rounds gathered $4.99B, followed by $2B in rounds located in Malta. The USA was in third place with $1.85B in new fundraising.
VC funds are becoming more selective, choosing projects with more advanced products. Some also choose a tokenless approach, avoiding the trap of increasing fully diluted value and token inflation. Animoca Brands lost its leading position, instead leaving Coinbase Ventures with the biggest number of rounds in the year to date. Coinbase Ventures led a total of 24 deals, while Animoca Brands lagged with just 18.
Animoca Brands slowed down its funding activity in 2025. | Source: Cryptorank
Interest in new projects is shifting, but in the past year, most regions saw a decreasing number of deals. In April, new deals increased in Canada and the Euro area but decreased in the USA and other previously hot regions.
As VC-backed new projects diminish, the crypto market aims to reawaken previously hot tokens, some of which managed to raise significant funding. Utility tokens are still competing with memes and BTC, as investors are still avoiding long-term holding in fear of protracted bear markets.
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