Key Points
- Crypto venture capital funding has seen a resurgence, with over $4 billion invested into startups.
- Four key investment areas are Ethereum restaking, DePINs, the Bitcoin ecosystem, and RWA tokenization.
Venture capital investments in the cryptocurrency sector have experienced a significant revival this year, with over $4 billion being poured into various startups. The primary areas attracting these investments include Ethereum restaking, decentralized physical infrastructure networks (DePINs), the Bitcoin ecosystem, and real-world asset (RWA) tokenization.
Ethereum Restaking and DePINs
Ethereum restaking is a relatively new area that has witnessed substantial growth this year, thanks to the pioneering protocol, EigenLayer. This protocol allows for the restaking of ether and liquid staking tokens with validators in other blockchain networks, enabling users to earn additional rewards. In less than a year, nearly $15 billion worth of assets has been accumulated through this protocol, leading to the launch of several EigenLayer-based liquid restaking platforms.
Leading platforms such as Ether.Fi, Renzo, and Puffer Finance have all raised funding this year. Ether.Fi raised a $27 million round in February, co-led by Bullish and CoinFund. This was followed by Puffer Finance raising an $18 million Series A round in April, valuing it at $200 million. Renzo raised $3.2 million in seed funding in January, and both Puffer and Renzo received additional funding from Binance Labs.
DePIN projects, particularly those operating on the Solana blockchain, are also gaining traction. Projects like Io.net, peaq, IoTex, Natix, and SendingNetwork have all raised funding recently. These projects use blockchain technology to decentralize their physical hardware infrastructure and reward users with tokens for expanding their networks.
Bitcoin Ecosystem and RWA Tokenization
The Bitcoin ecosystem is also experiencing rapid growth, with startups in the network receiving increased investment. So far, there have been more Bitcoin-related deals in 2024 than all of 2023.
Tokenization is another area gaining popularity, with startups like Securitize, Centrifuge, and Backed securing funding recently. Over 25 tokenization-related startups have raised a total of $80 million this year. This indicates a growing interest in the potential of tokenizing real-world assets.
