Updated: December 2, 2024
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Crypto startups captured $777 million in investments from venture capital (VC) funds in May, according to data aggregator DefiLlama. This is a 17% slide from the total amount netted in April, and the second consecutive month of VC capital slowing down.
Projects focused on building blockchain infrastructure received $630 million last month, representing 81% of the total amount raised in the period. However, this is $100 million less than the total capital flows directed to this sector in May.
Farcaster registered the largest infrastructure-related funding round in the period, with $150 million in investments coming from names such as Variant Fund, a16z Crypto, and Paradigm.
The Bitcoin (BTC) decentralized finance ecosystem also received attention from VCs, as the BTC staking protocol Babylon secured $70 million from relevant players like HashKey Capital, Polychain Capital, and Galaxy.
Despite showing a three-fold growth between March and April, the money directed to decentralized finance (DeFi) startups shrunk to $50 million in May. The largest funding round in DeFi was conducted by Fortunafi, a real-world asset tokenization protocol that received $9.5 million.
Notably, the non-fungible token (NFT) sector saw a fresh flow of VC money in May, as utility NFT platform Galaxis got $10 million from Chainlink and four other investors.
Web3-focused applications also witnessed growing interest from venture capital funds last month, netting $48 million in funding, a 153% monthly rise. Kiosk, a Farcaster client merging social and blockchain registered the most significant funding round in this sector by capturing $10 million from VCs.
Blockchain gaming wraps up the list with nearly $27 million invested, a slight leap from the $24.7 million captured in April. Param Labs received $7 million from VCs such as Animoca Brands, Delphi Digital, and Mechanism Capital.
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