Web3 investment collapsed by 76%
Date: 2023-07-20 Author: Karina Ziganova Categories: BLOCKCHAIN, IN WORLD
Venture capital funding for Web3 startups decreased by 76% compared to last year, as the number and volume of large transactions decreased to a minimum. This is stated in the Crunchbase study
Now there is a slowdown in venture capital in all sectors, but the Web3 sphere has suffered the most - now investors are increasingly moving into the field of artificial intelligence (AI) or the traditional financial sector.
How the inflow of investment in Web3 has decreased
In the second quarter of this year, Web3 startups raised just over $1.8 billion in 322 deals. This is a three-quarters reduction in funding compared to the second quarter of last year, when startups in the sector raised more than $7.5 billion.
At the same time, in the first half of 2022, Web3 startups raised almost $16 billion, in the first half of this year, investments amounted to only $3.6 billion, a decrease of 78%. In fact, the flow of deals reached its lowest level since the fourth quarter of 2020. At that time, the number of transactions was 291 for a total of $1.1 billion.
What's in store for Web3
Last month, there was an increase in activity in the Web3 sector after Fidelity Investments and BlackRock filed with the US Securities and Exchange Commission (SEC). However, in general, the regulatory environment, as well as last year's decline in the market, reduce the volume of investments
"There's no denying the massive collapses of major crypto exchanges — we all know their names — and recent regulatory actions in the U.S., which likely prevented some investors from peeking into the digital asset space," the experts concluded.
Now investors are wary of investing in anything other than AI. At the same time, they still invest small amounts in Web3 startups.
