According to figures released on Monday, global venture capital investment in cryptocurrency firms reached $2.4 billion in the first three months of 2024. This suggests that investor interest may be reviving.
Venture capital flows related to cryptocurrencies peaked at $11.1 billion in the first quarter of 2022, according to data from PitchBook. However, they then declined for seven consecutive quarters, ending with barely $1.7 billion in the last quarter of 2023.
According to a report by PitchBook senior analyst Robert Le, “the crypto industry is still in its early stages, and there is a lot of room for growth and innovation.”
“Barring any major market downturns, we expect the volume and pace of investments to continue increasing throughout the year,” he stated.
The cryptocurrency market had tremendous development in 2020 and 2021 thanks to a combination of low interest rates and a strong appetite for risk. However, in 2022, a string of bankruptcy at significant cryptocurrency companies alarmed investors and caused the price of bitcoin to fall.
Investors who had backed the U.S. exchange FTX were compelled to write down their holdings to nothing. Meanwhile, several cryptocurrency platforms ceased permitting withdrawals, leaving millions of people without money.
In part due to U.S. regulators’ approval of exchange-traded funds tracking the spot price of bitcoin at the beginning of 2024, investors have grown more confident in cryptocurrencies. Consequently, this has led to an increased interest among investors in digital assets over the past year.
From the lows of 2022, Bitcoin has progressively increased in value, reaching a new all-time high of $73,803.25, in March. However, it has since been unsure of its future course.
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