All transactions, trends, movements, and investments in the first quarter of 2022 in the Blockchain landscape presented by Cointelegraph Research.
The first quarter of 2022 saw unprecedented growth in terms of venture capital (VC) activity across different Blockchain sectors. In 2021, venture capital firms invested more than $30 billion in infrastructure, non-fungible tokens (NFTs), decentralized finance (DeFi), centralized finance (CeFi), and Web3. That set the bar very high if 2022 were to top it. In the first quarter of 2022, venture capital inflows exceeded $14.6 billion, or about 48% of all venture capital investments last year.
In the first three months, more than 500 individual deals were closed in the five main sectors mentioned in 2022. Cointelegraph Research studied and analyzed its database of deals, mergers and acquisitions (M&A), investors, and cryptocurrency companies to compile a report of 12 pages on the main activities of VC in the crypto sphere.
Leaving 2021 behind
Anyone interested in cryptocurrencies, Blockchain, and the future of this industry should pay close attention to the content of this report. By studying what VCs are doing and learning about the players that are investing in projects and what platforms people are investing in, they can help stay on top of things and make informed decisions.
It takes more than great technology to get people to use a product. History has great products that simply did not have the right mix of marketing, management, or capital to successfully bring a product to market.
Venture capital companies try to solve these problems by investing more than just the capital needed to get a project off the ground; they also provide a network of contacts who can bring solutions to the right mix of marketing and strategic management.
Record in Number and Value of Operations
The first quarter of 2022 saw an unprecedented amount of capital inflows in the Blockchain industry. Since the start of 2021, each quarter has continually increased the total capital invested in this space, culminating in the first quarter of 2022 ushering in more than $14.6 billion in venture capital investment. The median US dollar value of each deal has also increased and now stands at around $32.3 million over the past three months.
The number of individual deals is also on the rise, has broken the previous record, and reached over 500 in the first quarter of 2022. The rise is likely to continue the upward trend as the space is attracting new funding from Bain Capital and Sequoia Capital, venture capital firms that have been in traditional markets for a long time. The industry has also seen consolidation through acquisitions by long-standing cryptocurrency players such as OpenSea, Coinbase, Fireblocks, FTX, and Blockchain.com. In all cases, these strategic purchases broaden the scope of each company’s core business offering.
Active Seed Rounds, but Expansion Rounds Generate Greater Capital Interest
The pre-seed and seed rounds had the most venture capital activity with 288 individual deals worth more than $2.1 billion. Watching these rounds unfold is promising for the entire industry, as each startup brings new applications for Blockchain and new competition for previously formed organizations.
The expansion rounds did not see as much activity, but registered more than 2.5 times the capital inflows, with almost USD 5.8 billion. These rounds help encapsulate the overall growth potential and scope of current Blockchain projects, which most venture capital firms are willing to put money into, as they are less risky than earlier stage investments such as the series A rounds.
Blockchain Needs the Right People
One issue that is intensifying with all this capital investment is the need for people and talent in the Blockchain space. As more companies have plans to expand, create new products and diversify their organizations, employees with the right skills are getting harder to find. Cointelegraph Research recently interviewed Keychain Ventures and Dragonfly Capital. In that conversation, they discussed many topics, including the human capital bottleneck, which will only get increasingly tense as people invest more in the sector.
By Audy Castaneda
