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Despite a bullish trend in crypto asset valuations, November witnessed a significant dip in venture capital investments, highlighting investor caution.
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Overall, the month recorded just 90 crypto VC investments, marking a 9% decline from October, showcasing a stark contrast to previous months’ activity.
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According to RootData, “the total capital raised in November plummeted by 43.66%,” reinforcing the trend of declining investor interest.
November saw a significant drop in crypto venture capital investments, with only 90 deals and $449 million raised, indicating a cautious market outlook.
Notable Decline in Crypto VC Investments
Venture capital investment activity acts as a crucial barometer of major investors’ interest and confidence in the crypto market. Although November saw a dramatic bull market for crypto asset valuation, these gains did not translate into increased VC activity. Deals and the total amount raised both decreased dramatically in November.
In fact, November returned the lowest number of deals and capital raised throughout 2024. In a further twist, the largest individual deals were much lower than in previous months: September saw 12% less investment than August, but one deal raised $100 million. The standouts in November were all less than $50 million.
The allocation of funds across sectors bore a few resemblances to October: once again, infrastructure, DeFi, and games saw the highest returns. However, it was much lower, and CeFi investment has apparently cratered.
usdx.money Leads a Battered Market
On November 29, stablecoin issuer usdx.money announced a successful fundraising round of approximately $45 million. The firm claimed that this investment brought its total valuation to $275 million.
A few of its largest investors include NGC, BAI Capital, and Generative Ventures. usdx.money will use these funds to accelerate ecosystem development.
A close runner-up was Zero Gravity Labs (0G Labs), a modular AI chain which announced a $40 million seed funding round on November 13. However, the firm managed to secure even further investments: it secured a $250 million commitment to future token purchases and launched a successful node sale the same day.
“We’re thrilled to announce that the 0G AI Alignment Node Sale has hit $10 million in support! This is a huge step forward for decentralized AI as a public good, where transparency, security, and community come first. Thanks to our incredible community for believing in a trustless future for AI,” claimed the company in a November 13 social media post.
Additionally, two other crypto firms tied for third place with investments of $30 million. Monkey Tilt, an online gambling platform, managed to secure this amount in Series A funding on November 19. Canaan, a Chinese mining equipment manufacturer, raised the same amount the previous day, despite suffering downward trends last year.
These four were the only crypto companies to earn more than $25 million in venture capital investment this November. Compared to previous months, this is a very dramatic decline.
Nonetheless, the crypto market is very bullish, which might help explain this greater shift. After all, several firms are investing directly in major BTC purchases, not crypto companies.
Conclusion
The decline in crypto VC investments in November is telling for potential investors, illustrating the cautious sentiment in a fluctuating market. As only a handful of firms lead capital influxes, it will be essential to monitor how this trend unfolds in the upcoming months.
