The Growth of Venture Capital Investment in Blockchain and Crypto Reach 280% Per Year

November 20, 2018

The world is seeing a huge enlargement of Blockchain technology especially Crypto which has never happened before. In just the first three quarters of 2018, the venture capital (VC) investment in these kinds of companies has nearly tripled, according to a new Diar report published on September 30th.

In their report, Diar cited data from Pitchbook showing that VC for Blockchain and crypto-based firms has grown from approximately  $1 billion up to $3.9 billion, which is equivalent a 280% increase. The increase in the number of investments caused the rising is easy to recognize but there also is another reason – the increase in the size of the investment. Investors now tend to spend $1 million more than their previous investments.

The ten largest deals in 2018 have totaled a value greater than all of the deals in 2017 combined – valued at approximately $1.3 billion. Nine of these represent traditional equity investments, instead of purchasing utility crypto tokens. The only exception was DFINITY token, which raised $163 million USD from VC investors Andreessen Horowitz, Hashed, and Polychain Capital.

According to Pitchbook’s figures, Barry Silbert’s Digital Currency Group (DCG) was one of a kind when they invested 110 deals in the crypto and blockchain space this year from the VC sector.  With more than two power investors in the space, Blockchain Capital and Pantera, which had combined deals clocked in at 100.

Besides these, there are some other strong investors including VC Firms such as Andreessen Horowitz, Danhua Capital, and Future Perfect Ventures and “active angels” Tim Draper, Naval Ravikant, Roger Ver, and Barry Silbert.

Beyond these major players, Blockchain and crypto space also welcome close to 2,000 investors. The Top 50 active members of them have invested in at least eight firms, while 52% of investors choose Blockchain and crypto as one of the ways to diversify their portfolio.

The geographic distribution of the VC capital that flows into Blockchain can give us an overview of Blockchain development. Diar presented analyses showcasing the U.S as the biggest player with 79% hold in the market. Followed by 12%  from China and 2% from South Korea and Singapore.

Diar’s report also shows that banks are doing operations that aim to facilitate the blockchain industry. Although banks had to build blockchain “from the ground up”, they nonetheless integrated fiat and crypto services, increasing the number of crypto-related firms that are starting to secure banking licenses.

According to a report that came out on Oct 2, 2018, Korea Investment Partners (KIP), the largest VC firm in Korea, has invested in its first blockchain startup – one master in using technology for supply chain management solutions. KIP is famous for its investment in popular firms like Naver – the largest search engine as well as giant messaging in Korea and Japan- Kakao, and LINE.


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