Cryptoverse: Venture capital still haunted by crypto chaos
VC crypto bets totaled just under $2.3 billion in April-July this year, the lowest quarterly level for over three years, according to data firm PitchBook. In the first half of 2023, investments were down by almost three-quarters from a year ago to $5 billion.
«The lofty exuberant valuation days are gone,» said Tal Elyashiv, founder and managing partner of SPiCE VC, adding that valuations place on crypto companies had fallen closer in line with their actual performance.
Crypto investors remain haunted by the chaos that descended on the sector last year when the implosion of the FTX exchange and other major firms, including hedge fund Three Arrows Capital, sent shockwaves through the industry.
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View Details» U.S. regulatory scrutiny has also tightened on the industry.
«The biggest change from the height of the market is more time to do deeper diligence,» said Cameron Peake, partner at Restive Ventures. «There's not necessarily anything new that is happening, except that funds are actually doing diligence now. Deals are no longer closing in mere days.»
The number of deals that were sealed by the halfway mark of 2023 was 814, down by more than half of 1,862 from the same period in 2022, PitchBook data showed.
«Almost every company in the space tightened up in the aftermath of the carnage of 2022. Those that are raising capital now are probably doing it because they have to,» said Adam Reeds, CEO of Toronto-based
