Last year, the number of crypto VC investment deals plummeted by 60%, but a moderate recovery is expected this year
In 2025, the total amount of crypto venture capital reached $18.9 billion, an increase from $13.8 billion in 2024, but the number of transactions plummeted by 60% to about 1,200, with funding highly concentrated in later-stage projects. Digital Asset Trust (DAT) raised approximately $29 billion, attracting a large amount of institutional capital. Early-stage financing significantly slowed down, primarily due to a reduction in available VC funds, institutional investors' preference for AI projects, and regulatory clarity driving rapid expansion of mature companies.Multiple investors expect a moderate recovery in early-stage financing in 2026, but the barriers remain high, with investors focusing more on fundamentals rather than narratives. Regulatory clarity in the U.S. is seen as a key catalyst. Investment hotspots are concentrated in stablecoins and payments, institutional-grade infrastructure, prediction markets, RWA tokenization, and DeFi. There are divergences in the intersection of crypto and AI, with some believing that hype is ahead of actual applications.Token sales re-emerged in 2025 but did not replace traditional VC, with expectations of a hybrid financing model forming. Overall, market discipline will continue, and capital allocation will become more rational.