Measuring Crypto Investment in 2022

Startups in the European crypto industry had a successful year in 2022 despite a bearish market trend. These startups raised a total of over $5.7 billion in funding, which was a significant increase from the $5 billion raised in the previous year. The number of European startups working on blockchain and crypto solutions surpassed both the U.S. and Asia, with most being early-stage, small-to-mid-sized companies with modest funding.

Although European companies accounted for 20% of the total global early-stage crypto startup funding, the U.S. dominated funding rounds exceeding $100 million. Crypto VC funds raised over $35 billion in 2022, pushing the industry to the forefront of venture capital. This was the highest amount ever raised in the industry, representing only around 16% of the total VC fundraising in 2022.

Investors remain undeterred by the ongoing bear market, as every market cycle increases VC activity. VC funding remained relatively stable during previous crypto price downturns, and investments made during such periods materialized in tech and usage traction alongside bull market price recoveries. Notable companies in the crypto space today, including Uniswap, OpenSea, Dapper Labs, and Sorare, were funded and launched during the 2018 crypto winter.

While decentralized finance (DeFi) saw a 120% increase in the amount raised, centralized finance (CeFi) still leads the way in VC investments. According to Samantha Bohbot, the chief growth officer of RockawayX, the biggest difference between investing in bull markets and bear markets is the speed of execution. Fundraises that were once fast and oversubscribed now take months to close due to the slowdown in the market.