Venture Capital Investment in Crypto and Blockchain in 2024

Venture capitalists invested around $13.7 billion in crypto and blockchain startups in 2024, a 28% increase from the $10.7 billion deployed in 2023, according to The Block Pro's Funding Dashboard. However, funding remains far below the peaks of $33.3 billion in 2022 and $29 billion in 2021.

"It's surprising that VC funding has not sped up more quickly relative to 2023 with bitcoin up over 150% YTD (year to date)," Rob Hadick, general partner at Dragonfly, commented. "I expect that's likely because the LP (limited partner) market has continued to stay relatively muted and most VCs do not yet have the confidence to deploy their remaining funds in earnest until they raise (or at least become comfortable they will be able to raise) new funds."

Will Nuelle, general partner at Galaxy Ventures, echoed this sentiment, acknowledging that while the funding increase in 2024 is promising, it feels modest compared to the broader market rebound.

Meanwhile, Hack VC's co-founder and managing partner Ed Roman mentioned that the growth aligns with his expectations. "The election results did not occur until late into the year, so the ripple effects of that haven't yet been felt," he explained.

Key Drivers of Growth

Several VCs identified the bullish crypto market this year, regulatory optimism, institutional adoption, and new narratives like crypto-AI integration as drivers for the 2024 funding increase.

When crypto prices rise, and sentiment is strong, both funds and angel investors deploy more freely, allowing more talented founders to enter the space, noted Lauren Stephanian, general partner at Pantera Capital.

Alex Odagiu, investment director at Binance Labs, attributed the growth to the broader market rally this year. Milestones like the approval of bitcoin spot ETFs validated crypto as an asset class, attracting institutional capital and accelerating inflows. Odagiu added that positive signals from a crypto-friendly U.S. administration under Donald Trump are expected to sustain this momentum.

Kyle Samani, co-founder and managing partner at Multicoin Capital, expressed optimism about the upcoming political landscape. "We've never had a pro-crypto President nor a pro-crypto Congress. We have both starting in 2025," he said. "We remain optimistic that they will prioritize crypto-related issues and pass clear rules that pave the way for more innovation and help keep crypto onshore."

A Record Year for Early-Stage Deals

Early-stage funding dominated in 2024, with pre-seed deals reaching an all-time high of over 1,180 (+68% year-over-year or YoY), according to The Block Pro's Funding Dashboard. Seed-stage funding totaled $3.4 billion, nearing 2021's $3.8 billion despite reduced overall inflows. Series A rounds saw over 175 deals (+59% YoY), raising $2.8 billion (+46% YoY). Meanwhile, mid- and late-stage funding declined, paving the way for mergers and acquisitions (M&As).

Top Sectors

Infrastructure led 2024 crypto VC funding, with around $5.5 billion invested across over 610 deals — a 57% YoY increase and the highest for the sector to date, according to The Block Pro's Funding Dashboard. Infrastructure investments focused on scaling blockchain networks to improve speed, cost, and scalability, particularly on Layer-2 solutions for Bitcoin and other blockchains. Modular technologies, including data availability, shared sequencers, and rollups-as-a-service, gained significant attention. Liquid staking protocols and developer tooling remained key areas of focus.

NFTs and gaming startups raised $2.5 billion, slightly exceeding 2023's $2.2 billion. Despite steady funding, on-chain metrics revealed declining activity in NFT marketplaces as trends like memecoins gained traction. With over 610 deals, NFTs and gaming maintained key focus, even as the market matured from its 2022 peak of 936 deals.

Enterprise blockchain funding dropped sharply, falling 69% YoY to $164 million from $536 million in 2023. Once central to the "Blockchain, not Bitcoin" narrative, enterprise applications have lost investor interest, with attention shifting to more scalable blockchain use cases.

Web3 has shown resilience, raising $3.3 billion over the past two years, close to the $3.4 billion raised in 2021–2022. Emerging areas like SocialFi, crypto-AI, and decentralized physical infrastructure networks (DePINs) drove this growth. DePIN stood out as a fast-growing vertical, reporting over 260 deals and about $1 billion in total funding.

DeFi experienced a resurgence in 2024, with over 530 deals (+85% YoY) compared to 287 in 2023. Bitcoin-based DeFi use cases, such as stablecoins, lending protocols, and perpetual swaps, drove this growth. Layer-2 networks and non-custodial payments, including cross-chain liquidity and stablecoins, also contributed.

Looking Ahead

Top crypto VCs express cautious optimism for 2025. While funding levels aren't expected to return to the highs of 2021–2022, there's a consensus that startups with strong product-market fit and tangible user adoption are best positioned to secure capital in the year ahead.

Visit our website next week for comprehensive insights on crypto VC funding and M&A outlooks for 2025.

To subscribe to the free The Funding newsletter, click here.