Crypto VC Funding Resumes Downtrend Despite Bull Market Signs


Crypto VC funding in October declined 10% month-on-month, with only 75 investment projects recorded compared to 83 projects in September 2023. However, analysts see a positive future for Bitcoin.

The crypto venture capital (VC) funding landscape has experienced a decline in investment activity, even as signs of a Bitcoin (BTC) bull run emerge. 

Over the past week, blockchain projects secured a total of $34.7 million across nine deals, according to data tracked by DeFi Llama. The figure represents a significant drop from the previous week, which saw over $107 million raised.

The most substantial funding round of the week involved the Uniswap DAO, which invested $12 million worth of UNI in Ekubo Protocol, a market maker based on StarkNet. In exchange for the investment, the Uniswap DAO received a 20% share of governance tokens. 

Other notable deals included Modulus, a zero-knowledge artificial intelligence (AI) data verifier, raising $6.3 million led by Variant and 1kx, and Toposware, a zero-knowledge infrastructure provider, securing $5 million in a seed+ round led by Evolution Equity Partners.

There has also been an increase in investment across AI-focused crypto projects. For one, Modulus, which raised more than $6 million, aims to address security concerns related to AI adoption by leveraging zero-knowledge proofs to verify the integrity of algorithms. 

Vaas, an AI-powered analytics firm, also raised $2 million in pre-seed funding. Combined, AI projects accounted for nearly a quarter of the total funding raised during the week.


Crypto VC Funding Decline in October

Aside from last week, publicly disclosed investment projects by crypto VCs also experienced a decline in October. According to data from RootData, VC funding in October declined 10% month-on-month, with only 75 investment projects recorded compared to 83 projects in September 2023. 

Furthermore, this reflects a significant year-on-year decrease of 45% compared to the 135 projects reported in October 2022. 

In terms of investment allocation, infrastructure projects received the largest share of funding, accounting for approximately 24% of the total, followed by decentralized finance (DeFi) at 21%, centralized finance (CeFi) at 9%, and non-fungible tokens/GameFi at 13%. 

It is worth noting that October witnessed a 20% decrease in total financing compared to the previous month, with $430 million invested, contrasting with the $530 million raised in September 2023. Moreover, on a year-on-year basis, the decline is even more significant, with a staggering 63% drop from the $1.15 billion invested in October 2022.

Experts Believe Bitcoin Bull Market Already Started

Meanwhile, the decline in crypto VC funding comes at a time when some experts believe that the Bitcoin bull market has already commenced. According to Matrixport, a crypto financial services platform, Bitcoin’s fifth bull run officially began on June 22, 2023.

“This bull market officially commenced on June 22, 2023, when Bitcoin reached a new one-year high for the first time in a year,” the company wrote. “Historically, when this signal was triggered, Bitcoin has delivered, on average, returns of +310%.”

According to Matrixport, the latest Bitcoin bull market is fueled by expectations of institutional adoption. Institutional investors are increasingly considering Bitcoin as a diversification tool for their asset portfolios.

Bitcoin’s attributes, often associated with safe-haven investments like gold and treasury bonds, have caught the attention of institutions seeking to hedge against economic uncertainty. This trend coincides with the United States’ escalating debt-to-GDP ratio, further compelling institutions to explore alternative investment avenues.


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Ruholamin Haqshanas

Ruholamin Haqshanas is a cryptocurrency and finance journalist with over three years of experience in the field. He has a bachelor's degree in Mechatronics and a keen interest in the FinTech space. He began as a freelance technology writer but turned to crypto after delving into the industry in 2019. Ruholamin has been featured in a number of financial and crypto news outlets, including CryptoNews,, 24/7 Wall St, The Tokenist, Business2Community, ZyCrypto,, Milk Road, and others. He has also worked with some major crypto and DeFi projects as a content creator, including Midas Investments, BullPerks/GamesPad, and Equalizer Finance.