Is it a crypto winter or a bear market? Aren’t bears supposed to hibernate in winter? VCs don’t seem to care either way, as 2022 is already a stupendous year for blockchain-sector funding from big players, and the halftime show’s only just wrapped up.

A recently published report from Messari and Dove Metrics reveals that a record US$30.3 billion in VC money was raised in 1,199 funding rounds by crypto projects and startups during the first half of 2022.

It’s more than 2021’s entire VC crypto funding total put together (US$30 million) – and that was a record year for venture capital cash splashing in the sector.

And despite the post LUNA-implosion “crypto contagion” involving prominent CeFi (centralised finance) entities including Celsius, Voyager and others, the CeFi sector actually benefitted from US$10.2 billion of that funding. Much of it ended up in the hands of crypto exchanges and payment services.

As Cointelegraph also points out using a detailed infographic, a lot of that funding occurred in Q1 this year, with the 10 biggest raises ranging from US$1.15b (Citadel Securities) and US$1b (ahem, the ill-fated Luna Foundation Guard) to US$385 million (mining firm Compute North).

Image: Messari and Dove Metrics H1 2022 Fundraising Report

Other highlights/learnings from the 34-page Messari/Dove Metrics report include:

• Gaming NFT projects are also still attracting the big bucks. Of the “Web 3 & NFTs” category, which has pulled in more than US$8.6 billion so far in 2022, gaing-related NFT initiatives raised “more than four times as much as any other NFT vertical”.

• Non-Ethereum NFT projects outpaced Ethereum-ecosystem NFT projects in Q2 by a margin of US$1.8 billion.

• Decentralised Autonomous Organisations (DAOs) continue to do well in early-stage funding rounds, with 71% of funding in this category occuring at the seed-investment stage.

• Decentralised finance (DeFi), which has generally attracted far less funding this year compared with other sub-sectors, at least ended H1 on a strong note, raising US$624 million in June. Older DeFi protocols such as Aave and Curve have been on the rise over the past couple of months – perhaps “DeFi 1.0” is in the process of making something of a comeback?

 

Three recent notable funding moves

Blockchain security outfit Halborn’s US$90m Series A

If there’s one thing the crypto sector needs more of, it’s security. To that end, let’s hope the US$90 million being thrown the way of blockchain security firm Halborn is money well spent.

Among others, Summit Partners, Castle Island Ventures, Digital Currency Group and Brevan Howard have stumped up the cash for the Miami-based firm founded by “ethical hackers” Steven Walbroehl and Rob Behnke.

 

VC Lattice Capital’s US$60m raise

Lattice Capital, a San Francisco-based VC firm focused on early-stage crypto projects (which is most of them, tbh), last week raised US$60 million for its second fund – three times bigger than its initial fund late last year.

According to general partner Mike Zajko, who spoke to CoinDesk, the company is looking to invest in up to 50 companies and is undeterred by the bear-market conditions.

“We continue to be impressed by the talent entering the crypto space and welcome a bear market as an advantageous time for committed investors like us to partner with promising new projects that are as excited to build in a bears as a bull,” Zajko told the New York-based crypto-media outlet last week.

 

Gaming payments firm Zebedee’s US$35m Series B

Bitcoin-focused gaming startup Zebedee recently raised US$35 million in a Series B funding round with Final Fantasy publisher Square Enix notably participating in the backing. The round for the New Jersey-based company was led by Kingsway Capital, and also gathered funds from The Raine Group, Initial Capital and Lakestar.

Zebedee runs a slightly different line from other gaming players in the space, which generally operate in the Ethereum, Solana or Avalanche blockchain ecosystems. Zebedee instead facilitates micropayments on Bitcoin’s Lightning Network for game developers. Not as easy as it perhaps sounds, apparently.

 

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