Web3 Investments Fall by 76%
Venture capital funding for web3 startups in the second quarter of 2023 witnessed a sharp decline of 76%, amounting to $1.8 billion, compared to the same period last year.
Crunchbase data revealed that the number of transactions sank to an all-time low of 322, a decrease of 51% since the end of 2020.
Investors raised just $3.6 billion in the first half of 2023, a far cry from the $16 billion transacted in the same period in 2022.
Noteworthy transactions for the second quarter include the Swiss Islamic Coin project, which raised $200 million led by ABO Digital; the LayerZero omnichain protocol, which closed a $120 million funding round, led by Sequoia; and the Worldcoin startup, whose $115 million Series A was funded by Blockchain Capital.
Analysts attributed the fall in investment to the exodus of large investors from the artificial intelligence sector, which had raised $25 billion by mid-year.
According to Crunchbase, there is potential for the market in Web3 to hit bottom soon, while cryptocurrencies, such as Bitcoin, were reported to have seen a growth in the same period.
