Despite Bear Market, 2022 Fundraisings Already Surpassed 2021: Messari

Investments targeting the crypto industry reached $30.3B in the first half of the year, more than the whole year combined in 2021, according to Messari’s H1 2022 Fundraising Report. It shows that the market slump in the first six months did not shake investors’ faith in blockchain and crypto technology.

Despite the notorious collapses of a group of CeFi projects in Q2, the sector has remained robust in attracting investments totaling $10.2B, leading ahead of three other areas, including infrastructure, DeFi, and Web3&NFT.

Ethereum In Focus

Per the report conducted by Messari’s newly acquired fundraising database Dove Metrics, the upward trend of betting on crypto projects has demonstrated steady growth in H1 compared to the previous six months. Crypto and traditional funds raised a total of $35.9B in the same period, surpassing the whole-year volume of $19B in 2021.

Across the major sectors, investments are heavily tilted towards early-stage projects, suggesting that investors view crypto as a burgeoning industry with huge potential.

This trend was well-reflected in Ethereum losing the lead on NFTs in H1 as other upcoming ecosystems continued to win funding. Ethereum-based projects only gained $1.1B via investments, far lower than projects based on other networks combined at $2.9B. It’s worth noting that Solana-based NFTs have grabbed attention lately due to low network fees. That is especially shown in the rising popularity of the marketplace Magic Eden, which raised $130M in June this year.

On the other hand, Ethereum-based DeFi protocols continued to dominate fundraising in the same period, with 56% and 82% of the DeFi funding capital going to Ethereum in Q1 and Q2, respectively. The report added that DEX’s and Asset Management products were the most popular among investors.

CeFi Attracted Capital Despite Bankruptcy Scandals

Centralized exchanges attracted $3.2B in H1, far ahead of the second-ranked payment companies obtaining $1.58B in funding, despite the fallout of multiple high-profile brokerages and lending firms.

As a relatively mature sector, CeFi had half its funding rounds amounting above $10M from January to June, with the total investment reaching $10.2B, down 5.6% from H2 2021. Also, 40% of the funding rounds for infrastructure were directed to Series A or late-stage projects, with smart contract platforms taking the largest share out of the funding.

In summary, the report indicated that the exacerbated market crash in May and June did not thwart investors’ confidence in the industry as no sharp drops in volume were seen across various sectors.