As 2019 comes to a close, the crypto industry has seen numerous strategic financing deals this year. Despite the competitive pricing of cryptocurrencies, data indicates a significant decrease in financing amounts compared to the bear market of 2018, with overall investment funds plummeting by 129%.
According to the startup data platform
Crunchbase, in 2018, there were 1,148 financing deals totaling 4.65 billion USD. However, in 2019, the number significantly decreased, although it was still higher than in 2017, indicating a waning interest from venture capital firms in blockchain startups.
A
report pointed out that despite the slowdown in institutional interest, excluding the more speculative year of 2018, crypto institutions including exchanges and data analytics platforms remain attractive. Below are the top ten strategic financing deals in the crypto industry this year by funding amount:
10. Messari – $4 million
Data analytics company
Messari raised $4 million in a round led by California-based venture capital firm
Uncork Capital. Jeff Clavier, the founder of the venture fund, also officially joined Messari's board.
9. BLADE – $4.3 million
California-based startup
BLADE, a derivatives trading platform, secured $4.3 million in seed funding mid-year from mainstream exchange Coinbase, angel investor
SV Angel, and others.
8. CoinFlex – $10 million
Hong Kong-based
CoinFlex, a physically settled cryptocurrency futures exchange, raised $10 million in a mid-year round led by crypto investment firm
Polychain.
7. FTX – $10 million
FTX, a cryptocurrency derivatives exchange, raised $10 million this year from Proof of Capital, Consensus Lab, and Galois Capital. FTX offers 101x leverage and futures trading for various altcoins and major cryptocurrencies.
6. BlockFi – $18.3 million
Cryptocurrency lending platform BlockFi raised $18.3 million in a Series A funding round in August. Venture capital firm
Valar Ventures led this round. Furthermore, BlockFi recently announced plans to launch an exchange and secured $50 million in a round led by
Galaxy Digital Ventures.
5. Elliptic – $23 million
London-based crypto tracking and analytics firm
Elliptic raised $23 million in a Series B funding round led by Tokyo-based holding group
SBI Group. Elliptic CEO James Smith stated, "Our goal is to make businesses feel safe and know who they're transacting with. Cryptocurrencies are going to be part of the global financial system in the long run."
4. Chainalysis – $30 million
Crypto analytics company
Chainalysis, which tracks and analyzes transactions using blockchain technology to aid authorities in criminal investigations and help banks and exchanges avoid illicit funds, raised $30 million in a Series B funding round led by Accel. The funding will be used to promote the adoption of "Know Your Transaction (KYT)".
3. Kraken – $100 million
Established in 2011,
Kraken, one of the oldest cryptocurrency exchanges in the United States founded by Jesse Powell, raised $100 million in February this year, valuing the exchange at $3.9 billion. Kraken also acquired UK-based crypto derivatives platform
Crypto Facilities in a "nine-figure" deal.
2. Bithumb – $200 million
South Korea's mainstream exchange
Bithumb, established in 2014, raised a whopping $200 million in a Series A funding round this year. The company aims to transition from a cryptocurrency exchange to a global digital financial company based on blockchain.
1. Robinhood – $323 million
California-based
Robinhood, originally known for offering a commission-free stock trading platform, garnered attention when it launched cryptocurrency trading in 2018, raising $363 million in a Series D funding round. Continuing its momentum, Robinhood secured $323 million in a Series E funding round in July this year, nearing an $8 billion valuation. The round was led by
DST, with participation from Ribbit Capital, NEA, Sequoia, and Thrive Capital.
Conclusion
This year's financing projects were predominantly focused on cryptocurrency exchanges. However, from the list of the top ten strategic financings, it can be observed that blockchain analysis and cryptocurrency tracking and evidence gathering continue to attract venture capital firms.
Shifting investment focus towards evidence and analysis may indicate that Silicon Valley sees the inevitable and ubiquitous future of crypto technology, thus deserving the same level of attention and scrutiny as traditional financial systems.
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