Overview of investment and financing in the first half of 2023: Under the deep bear, what arrangements are crypto institutions making?

Written by: Day
According to rootdata data, in 2022, the amount of fundraising in the encryption industry was US$26.77 billion, and the number of financing transactions was 1,528. In the first half of 2023, the amount of fundraising in the encryption industry dropped significantly. In the past six months, the global encryption market has raised a total of Funding is US$4.774 billion, with a total of 497 financings. Compared with 2022, the amount of financing dropped by 80%. On the one hand, the impact of the Luna and FTX thunderstorms has weakened the interest of investment institutions in crypto investment; on the other hand, it is also related to the deterioration of the general market.
 Source: rootdata.com Monthly Investment Amount, Source: defillama
Most of the positions held by top investment institutions have retracements of 70 to 80%. In this article, we take a brief look at the institutional investment trends in the first half of this year and what tracks and projects they have invested in.
 Value of ERC-20 Token held by institutions, source: dune Market financing performance this year 1. Financing for institutions: Data related to institutional investment amount and frequency, source: rootdata.com
According to rootdata data, as of early June 2023, the investment status of each track in a total of US$3.66 billion in financing is as follows:
 Infrastructure financed a total of 139 times, with US$1.379 billion in financing, accounting for 37.6%; other financings totaled 61 times, with US$540 million in financing, accounting for 14.5%; DeFi raised a total of 88 times, with US$410 million in financing, accounting for 11.2%; CeFi A total of 34 financing times, with a financing amount of US$400 million, accounting for 10.9%; Games have a total of 63 financing times, with a financing amount of US$390 million, accounting for 10.7%; Social entertainment has a total of 43 financing times, with a financing amount of US$240 million, accounting for 6.7%; NFTs have a total of Financing was 52 times, with a financing amount of US$160 million, accounting for 4.5%; Tools & Information Services was financing a total of 31 times, with a financing amount of US$110 million, accounting for 3.5%; DAO was financing a total of 4 times, with a financing amount of US$17 million, accounting for 0.5%.
It can be seen that institutions tend to invest in infrastructure and DeFi tracks, while their interest in DAO, tools & information services NFT tracks is relatively weak. Of course, it is also related to the market value ceiling of each track. The valuation of the infrastructure category is relatively higher than that of other tracks.
 2. Other other financing situations, source: cryptorank.io
On the other hand, the platform has raised a total of US$210 million in financing from other investors as of June 10.
 Proportion of each track, source: cryptorank.io
Among the financing for other investors, GameFi and the blockchain service track accounted for the largest share. Financing is mainly concentrated on four chains: Ethereum, Arbitrum, Polygon, and BNB.
 Distribution of amount of each chain, source: cryptorank.io Active investment institutions this year Source: rootdata.com
Next, we use the number of investment projects made by each institution as a standard to measure which investment institutions are still active this year and continue to "spend money".
 1.DWF Labs: 30
DWF Labs is a subsidiary of Digital Wave Finance. It has attracted everyone's attention this year due to its frequent moves. It mainly provides support for Token listing, market making, and OTC trading solutions for companies investing in Web3. Already conducting spot and derivatives trading on more than 40 top trading platforms, ranking among the top 5 global crypto asset trading volumes.
This year, a total of 30 projects were invested, involving more than 300 million US dollars (because some projects may have multiple institutional investments, and the financing amount of some projects has not been disclosed, so only part of it can be calculated, the same below). DWF Labs prefers to invest in projects that have issued Tokens and are listed on online trading platforms, such as EOS, ACH, CFX, FET, etc.
 2. Coinbase Ventures: 24
Coinbase Ventures is the investment arm of Coinbase dedicated to advancing outstanding entrepreneurs in the crypto/Web3 ecosystem and supporting Coinbase's mission to create more economic freedom in the world. This year, a total of 24 projects have been invested, involving nearly US$200 million.
Coinbase Ventures invests in underlying infrastructure, such as Ethereum re-staking EigenLayer, cloud platform Chaos Labs, DEX Mauve that provides traditional financial compliance, etc.
 3.HashKey Capital: 21
HashKey Capital is part of the Hong Kong digital asset group HashKey Group and is headquartered in Hong Kong, China. HashKey Capital invests in the entire blockchain ecosystem, including underlying public chains, protocols, applications and crypto-finance providers. It provides investment and consulting to help startups targeting developers, enterprises and end-users expand in Asia. This year, a total of 21 projects were invested, involving nearly US$130 million.
HashKey Group invests in infrastructure, games, NFT and other tracks, such as cloud platform Chaos Labs, karate combat league Karate Combat, infrastructure PolyHedra, cross-chain NFT platform Tabi, etc.
 4.Shima Capital: 19 pieces
Shima Capital is a San Francisco-based venture capital firm focused on seeking out and providing capital and resource support to early-stage crypto-asset and blockchain startups.
This year, a total of 19 projects were invested, involving nearly US$100 million. Shima Capital invests in infrastructure, NFT, entertainment games and other tracks, 6 of which are related to games. Relatively large investments include public chains Berachain and Monad.
 5. Polygon Ventures: 18
Polygon Ventures is committed to supporting visionary teams in the Polygon ecosystem and the multi-chain ecosystem. Take a collaborative approach and help projects succeed by providing support through Polygon’s capabilities in operations, technology, distribution and strategic partnerships.
Polygon Ventures has invested in a total of 18 projects this year, involving more than US$80 million in funds. Polygon Ventures’ investment tracks include infrastructure, entertainment games, and NFT fields, 10 of which are related to entertainment games. Larger investments include cloud platform Chaos Labs and Web3 gaming platform Intella X.
 6. Balaji Srinivasan (individual investor): 18
Balaji S. Srinivasan is known as the angel investor who is more powerful than any other institution in the crypto field. Formerly the CTO of Coinbase and general partner of A16z, he was also an early investor in many successful technology companies and crypto protocols, including Alchemy, Ava Labs, Chainlink, Clubhouse, Dapper Labs, Ethereum, Instadapp, NEAR Protocol, Opensea, Solana and other well-known projects. Srinivasan is also the co-founder of Earn.com (acquired by Coinbase), Counsyl (acquired by Myriad), Teleport (acquired by Topia), and Coin Center.
Balaji S. Srinivasan has invested in a total of 18 projects this year, involving nearly US$120 million. Balaji S. Srinivasan’s investments are mainly in infrastructure. Larger investments include cloud platform Chaos Labs, trust layer Proven based on zero-knowledge proof, decentralized social Lens Protocol, encrypted asset insurance company Evertas, etc.
 7.Animoca Brands: 16
Animoca Brands is a Web3 gaming software company and venture capital firm. Known for The Sandbox, Animoca Brands aims to provide digital property rights to gamers and internet users around the world, thereby creating a new asset class, an economy for making money through games, and a fairer digital framework for building open Contribute to the metaworld.
Animoca Brands has invested in 16 projects this year, involving approximately US$110 million. Animoca Brands’ investment tracks include infrastructure, NFT, and gaming. Larger investments include NFT super application OP3N, encrypted payment gateway Transak, Web3 gaming platform Intella X, cross-chain NFT platform Tabi, etc.
 8.NGC Ventures: 16
NGC Ventures is a venture capital firm focused on investing in blockchain and distributed ledger technologies. NGC Ventures has invested in a total of 16 projects this year, involving US$170 million in funds. NGC Ventures investment track has infrastructure and defi. Larger investments include the full-chain interoperability protocol LayerZero and the Web3 interoperability infrastructure PolyHedra.
 9. Big Brain Holdings: 15
Big Brain Holdings is a crypto fund that invests in pre-seed, seed and early-stage projects. The fund believes in the future of cryptoassets and invests in teams that are paving the way for that future. The team focuses on unique, innovative and blockchain-forward projects.
Big Brain Holdings has invested in a total of 15 projects this year, involving approximately US$60 million. Big Brain Holdings investment competition covers infrastructure, DeFi, NFT, games and other fields. Larger investments include Intella X, a Web3 gaming platform, and zkLink, a multi-chain L2 network focused on transactions.
 Large financing projects this year
Next, let’s take a look at the financing of more than 50 million US dollars this year. After all, with this year’s market conditions, we can still get so much money, which means that the quality of the project itself will not be too bad. However, investment institutions are still a bit deep. Officials have announced how much money was invested, how it was cashed out, and whether any money was given to the project side. Whether it is used as payment through resource support or other means, it is difficult for retail investors to know the specific situation. Just as a reference, we will introduce them one by one based on the amount of financing. Some projects have undergone multiple rounds of financing, and investment institutions only introduce those that invested money this year.
 Source: rootdata.com 1.Metaco: Acquired by Ripple for $250 million
METACO is a Swiss crypto asset custody company. Metaco's operating scope covers multi-national markets, and its customers include global custodians, large banks, financial institutions and other enterprises. Its core crypto asset custody product "Harmonize" can help investors manage the entire DeFi ecosystem, from custody to trading. , Tokenization, staking, and smart contract management are all within the scope. The platform seamlessly connects institutions with the new world of DeFi. The acquisition will allow Ripple to expand its offerings by integrating the technology into custody, issuance and settlement of tokenized assets.
 2. Blockstream: $125 million in debt financing
Investment institutions: Kingsway Capital, Fulgur Ventu.
Blockstream is an established Bitcoin and blockchain infrastructure development company founded in 2014. Its core is to develop new infrastructure for traditional financial systems. Key developments revolve around Bitcoin sidechains and other blockchain-related applications. It has launched many products such as Bitcoin sidechain Liquid, Bitcoin wallet Blockstream Green, crypto transaction data products and Bitcoin block production custody services. Blockstream will use the new funding to expand mining facilities to meet strong demand for its institutional custody services.
 3.LayerZero: US$120 million in Series B financing, valued at US$3 billion
Investment institutions: a16z, Sequoia Capital, Christie’s, Circle Ventures, etc.
Released in 2021, LayerZero is a full-chain interoperability protocol focused on data messaging between chains. Designed to deliver lightweight messages between blockchains through efficient gas usage and non-upgradeable smart contracts. At present, the network adoption rate of the LayerZero protocol is good, and it has supported more than 30 chains such as Ethereum and BNB Chain. The ecosystem is also expanding rapidly, and considerable progress has been made in the directions of DeFi, NFT, and cross-chain bridges.
 4. Worldcoin: US$115 million in Series C financing
Investment institutions: Blockchain Capital, a16z Crypto, etc.
Worldcoin is a crypto project founded by ChatGPT founder Sam Altman in 2020, aiming to become the world's largest and most inclusive crypto-asset network by making Worldcoin freely available to everyone. Worldcoin mainly consists of three parts:
 World ID: A privacy-preserving decentralized identity protocol. Worldcoin (WLD): Token is distributed for free around the world, exerting effective governance value. World App: Wallet for payments, purchases and transfers worldwide.
Currently, Worldcoin has a mixed reputation due to issues such as data privacy.
 5. Ledger: US$108 million in Series C1 financing, valued at US$1.416 billion
Investment institutions: True Global Ventures, Cité Gestion SPV, etc.
Ledger is currently one of the most well-known hardware wallet companies in the crypto industry. Since its founding in 2014, Ledger has sold more than 6 million devices to customers in more than 200 countries around the world. Some time ago, the release of key recovery services caused great dissatisfaction in the community.
 7. Auradine: US$81 million in Series A financing, valued at US$500 million
Investment institutions: Celesta Capital, Mayfield, etc.
Founded in 2022 by Rajiv Kheman (whose startup iInnovium was acquired by Marvell for $1.1 billion), Auradine is an infrastructure solutions provider that develops cutting-edge technologies such as energy-efficient silicon, privacy, zero-knowledge proofs and artificial intelligence.
 8.Chain Reaction: $70 million in Series C financing
Investment institutions: Morgan Creek Digital, Hanaco Ventures, etc.
Chain Reaction is a blockchain chip startup that is designing the future of disruptive blockchain and privacy technologies. The company works with cloud service providers and data centers to transform computing infrastructure using custom ASICs and systems to optimize energy-saving, high-performance calculate. Solutions are purpose-built and custom-designed to power the next generation of secure, scalable green computing to help protect people, privacy and the planet.
 9.Taurus: $65 million in Series B financing
Investment institutions: Credit Suisse, Arab Bank Switzerland, etc.
Taurus provides enterprise-grade infrastructure to issue, custody and trade any digital asset, including staking, tokenized assets and digital assets. Taurus also operates a regulated private asset and tokenized securities market. Taurus raised the capital to further develop its digital asset platform and drive international expansion.
 10.QuickNode: US$60 million in Series B financing, valued at US$800 million
Investment institutions: 10T Holdings, LLC, Tiger Global, etc.
QuickNode is a Web3 infrastructure platform that helps developers and enterprises build, launch, and scale blockchain-based applications (dApps). Since 2017, it has partnered with hundreds of thousands of top developers and companies to help scale DApps. The financing will be used to accelerate the company's global expansion, further enhance the builder's capabilities, and lay the foundation for a decentralized, globally connected future.
 11.Unchained Capital: $60 million in Series B financing
Investment institutions: Valor Equity Partners, NYDIG.
Unchained Capital is a Bitcoin-native financial services company offering collaborative custody, trading desks, Bitcoin-backed debits, and Bitcoin retirement accounts. Unchained currently protects more than $2 billion in Bitcoin across thousands of keys, according to the company.
 12.EOS: $60 million in financing
Investment institution: DWF.
DWF Labs supports the EOS network through a $45 million EOS Token purchase agreement and a $15 million investment commitment to invest in EOS-based businesses and projects, which is designed to accelerate the expansion and acceptance of the EOS network.
 12.Magic: US$52 million in strategic financing
Investment institutions: PayPal Ventures, Cherubic investment, Synchron, etc.
Magic provides enterprise customers with non-custodial wallet infrastructure, allowing them to securely onboard customers into the Web3 ecosystem. Features that provide end-to-end web3 onboarding, including authentication, fiat onboarding, NFT Mint, and NFT checkout. Its solutions are trusted by the top brands in web2 and web3, including Mattel, Macy’s, Xsolla, Immutable, and more. To date, Magic has created more than 20 million wallets and is used by more than 130,000 developers.
 13.EigenLayer: US$50 million in Series A financing, valued at US$500 million
Investment institutions: Blockchain Capital, Coinbase Ventures, Polychain Capital, etc.
Eigenlayer is a re-staking protocol built on Ethereum. Ethereum nodes can use EigenLayer to second-pledge the pledged ETH to obtain additional income. Externally, users are also allowed to use ETH, LSD-ETH and LP Token. Stake on other public chains, oracles, middleware, etc., serve as nodes and receive verification rewards.
 summary
The above is the investment and financing situation in the crypto market in the first half of 2023. It can be seen that large-amount financing is mainly concentrated in the basic agreement. DeFi, NFT and games are not available, but this is also related to the different ceilings of various track projects.
Some time ago, many people began to ridicule institutional investment. Institutional coins generally have high valuations, low circulation, and peak when they open. The role of retail investors is always to take over. Institutions mass-produce projects and then dump them to retail investors. Some investors complained and began to pursue various "local dog" projects such as memes.
Just like the recent Sui, which is known as "Water Drop Chip", after the mainnet went online, 58.88 million SUIs have been produced. The selling pressure continues, the price has plummeted, and investors have been unable to take over.