Cryptocurrencies

Venture capital (VC) funding rounds are on the rise as the cryptocurrency bull market returns

Venture capital (VC) funding rounds are on the rise as the cryptocurrency bull market returns and is firing on all cylinders.

On May 16, cryptocurrency venture firm Aquarius announced the launch of a $600 million multi-strategy fund to help blockchain enterprises and ecosystem projects boost on-chain liquidity. In a statement to Cointelegraph, Aquarius staff said the strategy fund is backed by “Bitrise Capital, several leading miners, family offices, and influencers.”

Additionally, the $600 million strategy fund will help blockchain infrastructure, decentralized finance, artificial intelligence, bitcoin ecosystem, modular architecture, and early-stage data layer projects build their communities along with developing products available in the market. “As the first institutional fund of its kind, it systematically manages cross-chain liquidity and helps various blockchain institutions and ecosystem projects meet their liquidity needs,” Aquarius wrote.

Aquarius was founded in 2018 by Singapore-based venture capitalist Lin Yang, who has backed high-profile ventures such as Conflux, as well as investments in emerging Web2 sectors, including new energy, advanced manufacturing and finance. The company moved its headquarters to New York on May 8.

Meanwhile, cryptocurrency ecosystem projects are getting significant funding as the bull market heats up.

On May 6, Cointelegraph reported that cryptocurrency venture capital funding surpassed $1 billion for the second month in a row this year. April saw $1.02 billion in funding across 161 investment rounds, compared to $1.09 billion in March, both trends not seen since late 2022.

Monthly funding amounts for the cryptocurrency project since January 2022. Source: RootData

Earlier this month, digital securities platform Securitize raised $47 million in a new strategic funding round led by BlackRock. Blockchain developers Aptos Labs, along with stablecoin issuers Paxos and Circle, were also among the investors. Joseph Shalom, Global Head of Strategic Ecosystem Partnerships for BlackRock, will join Securitize’s Board of Directors. He described the investment as “another step in the evolution of our digital assets strategy (…) which will help meet the future needs of our clients.”

In April, Puffer Finance, a liquid storage project built on Ethereum’s layer 2 solution EigenLayer, secured $18 million in a Series A funding round from the likes of Coinbase Ventures and Kraken Ventures to launch its mainnet. Puffer Finance technology allows Ethereum validators to reduce their initial capital requirements to just 1 Ether (ETH), compared to the 32 ETH required for retail stakeholders. The protocol surpassed a total value of $1.4 billion shortly after its debut in February.

The market has changed dramatically from what it was a year ago.

In September 2023, Tony Cheng, a partner at Singaporean cryptocurrency investment firm Foresight Ventures, recommended that projects do everything they can to survive. “If you’re short on capital, if you don’t have enough runway to continue for the next year or so, you have to take capital and take as much as you can get because that money may not be available anymore,” he explained at the time. Two or three months.”

Since reaching below $16,000 following the sudden collapse of cryptocurrency exchange FTX in November 2022, Bitcoin (BTC) has risen more than 300%, boosted by the approval of spot Bitcoin trading funds around the world and the gradual repayment of creditor funds stuck on the exchange. Exchange defunct. Some venture capital firms predict that the current bull market will see another ICO boom beyond the previous highs of early 2018.

Related: Crypto VC funding surged 53% in March, Optimism wins largest share

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