Recent years have witnessed a surge in the number of cryptocurrency companies, followed by the increasing number of venture capitalists willing to invest in their business. According to data presented by Buy Shares, the total amount of funding crypto companies raised over time hit $12.5bn in the third quarter of 2020, a 155% jump in two years.
More than $1.7bn Funds Raised in 2020
At the beginning of 2017, cryptocurrency companies worldwide raised a total of $1.3bn in funding rounds, revealed the CrunchBase data. By the end of the year, this figure jumped to $3.8bn. Statistics show that 2018 delivered substantial investments in crypto companies, with the total value of raised funds growing by more than $4.6bn and reaching $8.4bn by the end of the year.
Increased investments continued in the next twelve months, with the cumulative funding jumping over $10.8bn in the fourth quarter of 2019.
The CrunchBase data revealed that crypto companies raised another $1.7bn since the beginning of 2020, amid the slowdown in venture capital funding caused by the COVID-19 pandemic.
In July, the US-based commission-free trading company Robinhood announced it had raised $320 million in Series F funding from new and existing investors, the most significant investment in 2020. The company plans to use the funds to upgrade its platform, launch new products, and hire more staff.
Three months before that, crypto derivatives provider Bakkt also completed a $300 million B fundraising round led by big names including Microsoft’s M12, Boston Consulting Group, PayU, and Pantera Capital, the second-largest investment in 2020. The company explained it would use the funds to continue developing digital asset-focused services.
Statistics show that Bitcoin Suisse`s $48 million worth A funding round represents the third-largest investment in 2020. A Zug-based financial services provider for the digital asset industry said the funding round pushed its valuation to around $327 million.
North American Crypto Companies Raised 50% of Total Funding Amount
Analyzed by geography, North America represents the leading region with $6.2bn of investments in crypto companies. The US companies raised more than 90% of that amount, with California and San Francisco, as the leading hubs. Asian companies raised $3.5bn in total funding, ranking as the second-leading region globally. European cryptocurrency companies follow with $2.3bn worth funding rounds.
The CrunchBase data also showed that all five of the most active investors in the crypto market come from the United States. Statistics indicate the New York-based Digital Currency Group, as the leading investor, participated in 57 funding rounds so far. One of the leading venture firms in the blockchain industry, the San Francisco-based Blockchain Capital, ranked second, with a total of 30 funding rounds. Pantera Capital, Techstars, and Polychain follow, with 27 and 23 funding rounds, respectively.