Crypto venture funding in the first quarter of 2025 has surged to $4.9 billion, indicating a robust resurgence for the industry. This data, unveiled in a May 1 report by Galaxy, showcases a 40% increase from the previous quarter, with 446 deals contributing to this growth—a 7% uptick in activity. Notably, this quarter stands out as the most active period for crypto fundraising since late 2022.
A major driver of this impressive figure was MGX’s $2 billion investment in Binance, which accounted for over 40% of the total capital raised. Excluding this single deal, first-quarter funding would have amounted to $2.8 billion, reflecting a 20% decline compared to the fourth quarter of 2024.
The breakdown of crypto investments by category reveals that the Trading, Exchange, Lending, and Investing sector received the lion’s share of funding, totaling $2.55 billion with a growth rate of 47.9%. However, if we exclude the Binance investment, the DeFi sector would have led the quarter with $763 million in capital inflows.
Web3-related projects, encompassing gaming, NFTs, DAOs, and metaverse initiatives, garnered the highest number of deals, with 73 rounds accounting for 16% of all transactions. Following closely were trading-related firms with 62 deals.
Galaxy’s report also sheds light on a notable shift in investor focus. For the first time since the first quarter of 2021, a majority of the capital, approximately 65%, was allocated to later-stage companies. Early-stage rounds, particularly pre-seed deals, experienced a slight decrease but remained robust compared to previous cycles.
US startups dominated the funding landscape, capturing 38.6% of the total deal count. The UK followed with 8.6%, while Singapore and the UAE secured 6.4% and 4.4%, respectively. This surge in US investment may reflect increasing government support for digital assets.
Furthermore, the report highlighted a reinvigorated correlation between Bitcoin’s price movements and venture investment, signifying a return to strength after a period of weakening since early 2023.
Despite the year-over-year growth in fundraising, Galaxy acknowledged persistent challenges such as cautious allocator sentiment and the lingering impact of the 2022–2023 downturn. Moreover, the rise of AI has diverted investor attention away from crypto, with the AI sector now commanding the level of interest that crypto held in 2021 and early 2022. This shift is evident in the decline of funds raised by crypto-focused venture funds, which fell to $1.9 billion during the first quarter.
Nevertheless, Galaxy remains optimistic about the future, noting that 2025 is on track to surpass the previous year’s fundraising figures. With evolving market dynamics and ongoing developments, the crypto venture funding landscape continues to show resilience and promise for the industry’s growth.