Venture capital (VC) funding flowing to the crypto space showed a positive shift in the first quarter of 2024, breaking a two-year slump. 

Data analysis platform Crypto Koryo posted a report on X, highlighting that the total amount invested and the number of projects that received VC funding have increased since the fourth quarter of 2023.

The platform noted a 38% increase in the funds invested in the quarter.

Crypto VC funding breaks 2-year downturn in Q1 2024 image 0 Amount invested by crypto venture capital funds per quarter. Source: Crypto Koryo

In addition, there was a 49% increase in the number of projects that received funding. The number of projects receiving funding has not been seen since the fourth quarter of 2021.

This means that crypto VC funding is going into an upward trajectory.

Crypto VC funding breaks 2-year downturn in Q1 2024 image 1 Number of projects getting crypto VC investments per quarter. Source: Crypto Koryo

Crypto Koryo believes this could be “the start of a new wave.” The analysis platform noted that the recent uptrend shows similar patterns to the fourth quarter of 2020 before massive VC investments flowed into the space.

Crypto Koryo also highlighted that, unlike previous quarters where banks and non-crypto VCs led the investments, this quarter showed more interest from crypto-focused venture firms.

Crypto VC funding breaks 2-year downturn in Q1 2024 image 2 Top 50 investors in the first quarter of 2024 in the amount invested. Source: Crypto Koryo

Crypto-native VCs like Andreessen Horowitz Crypto, OKX Ventures, Multicoin Capital, Paradigm and Polychain dominate the funds invested in the quarter.

In March alone, crypto VC funds invested over $1.1 billion across 180 investments. VC funding in crypto jumped by 52.5% month-on-month in March, with investments flowing into infrastructure and decentralized finance (DeFi) projects.

Related: Venture capital exec says ‘lack of innovation’ drives funding away from crypto

The uptick in funding in the first quarter of 2024 also follows an upward momentum from the fourth quarter of 2023.

In Q1 2023, crypto VC investments showed a 2.5% increase compared to the third quarter of 2023. This marked the first VC investments in crypto projects that have risen since March 2022.

2022 was a tough year for crypto as a decline in venture capital funding flowing into the sector accompanied the bleak market conditions. The year showed consecutive quarterly drops when it came to venture capital investments.

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