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Tracking analysis of 680 Crypto financing information, found these investment preferences and trends

2023-01-04 17:59

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Even if the golden age of crypto funding is over for now, analysis suggests that the industry as a whole is still growing strongly.

I Analyzed 680 Crypto Funding Rounds to Learn Where Investors Put Their Money

Original article by Ren & Heinrich

ChinaDeFi

This article describes the results of my analysis of 680 crypto rounds of financing. The results show current trends and can provide a basis for making predictions about future developments.

Source: https ://defillama.com/raises

Data set

All data from DefiLlama. Their complete data set covers the past five years. To reduce the workload, I only analyzed the data available through 2022.

An overview of all cryptocurrency fundraising rounds in 2022

The chart below shows funding for all cryptocurrencies this year.

The yellow bar chart shows the amount of project financing, while the blue line shows the total amount raised each month. As the chart shows, crypto projects raised more money in the first half of 2022.

The table below shows the stages in which each project was funded.

It turns out that a large proportion of projects are funded at an early stage (Pre-Seed, Seed). In contrast, relatively few people received funding in the later stages (Series A and B).

Next, let's look at the categories and use cases.

For the full year, the following three categories were the most popular among investors:

DeFi Infrastructure (for Web3)NFT and related projects

Now look at the amount invested in each sector (in dollars).

The following sectors will see the highest investment in 2022:

Infrastructure is DeFiCeFi

Crypto financing: Category analysis

An analysis of each category leads to the following conclusions:

A large number of infrastructure projects have been launched and a large amount of capital has flowed into the sector, meaning that the industry still needs to lay a good foundation. Many projects aim to improve the integration of encryption applications with existing solutions and processes. To me, this is a sign of healthy growth for the industry as a whole.

DeFi's success will continue. Decentralized financial solutions have become one of the main uses of cryptocurrencies. Investors still seem to see plenty of potential.

Despite LUNA, FTX, and other disasters, however, centralized solutions will remain an important part of cryptocurrencies for the foreseeable future. That, at least, is what the high fundraising numbers for CeFi and CEX suggest.

In the second half of 2022, gaming, NFT and related areas, security, saw the most significant growth in terms of the number of crypto projects raised. The total amount raised in these areas is also relatively high.

Next, we take a look at the top investors leading the 2022 cryptocurrency funding round.

The chart above shows the number of projects (turquoise dots) and the amount of money top investors have invested in crypto projects (yellow bars).

Two points first:

The investors in question are lead investors, and usually a group of investors will participate in the funding round. The amount of financing refers to the total amount invested by a group of investors, including the lead investor. For projects where lead investors are not identified, rounds of financing are not included in the chart.

Binance Labs' funding data is incomplete. The real total is much higher. This is also because some projects do not state the total amount raised.

The categories top investors invest in most frequently:

DeFi (31)

Infrastructure (24)

NFT and related fields (13)

Wallet (9)

Safety (7)

DEX (7)

The final word on this crypto funding analysis

Significantly less money flowed into cryptocurrencies in 2022 compared to the previous year. This is mainly due to the ongoing bear market, and the impact of the general economic downturn.

Even if the golden age of crypto funding is over for now, analysis suggests that the industry as a whole is still growing strongly.

prospect

In 2023 and beyond, we will see:

Better Web3 infrastructure, including expanded solutions, a friendlier development environment, improved user experience and increased efficiency of Dapps;

More cross-chain, security and privacy solutions;

More diverse ecosystems;

More integration of existing technology and daily life with Web3;

More agencies are joining.