In the initial quarter of 2024, as Bitcoin's value skyrocketed over $73,000, the crypto venture capitalists found themselves unable to match this surge due to evolving market dynamics. Despite the general correlation between crypto VC investments and Bitcoin's price movements, the first quarter of the fiscal year witnessed a divergence from this trend, although overall investments in the crypto sector saw a notable increase.

Crypto VC Investment & Bitcoin Price

Data from Galaxy Research reveals that during the first quarter, venture capitalists injected approximately $2.3 billion into the crypto market, while Bitcoin's price experienced a remarkable surge surpassing $73,000. Based on past patterns, these institutional investors were expected to contribute around $14 billion to align with Bitcoin's escalating value.

Although the crypto VC investment figure rose from under $2 billion, the growth did not meet initial expectations. Following Bitcoin's previous peak at $69,000 in November 2021, venture capitalists had infused $12 billion into the market during the first quarter of 2022.

Factors Influencing Investment Discrepancy

The underwhelming level of crypto venture capitalist investment could be attributed to emerging market trends such as the introduction of Spot Bitcoin ETFs, the rise of crypto restaking, and uncertainties surrounding Federal Reserve interest rates. Additionally, venture capitalists might have considered investing in Spot Bitcoin ETFs instead of directly holding BTC, but their actual strategies remain undisclosed pending the Form 13F filing deadline on May 15, leaving room for speculation on their approach amidst market uncertainties.

BTC Price Reaches $63,000

After dipping to a low of $56,000 earlier in the week, Bitcoin's price has rebounded, currently standing at $63,729.73 as of Saturday, May 4, marking an 8.13% increase. The pioneering cryptocurrency boasts a substantial market capitalization of $1.25 trillion.

Furthermore, Bitcoin's trading volume surged by 9.48% to $32.07 billion within the last 24 hours. This resurgence follows positive U.S. job data and the renewed inflow of Bitcoin ETF investments. Notably, on Friday, May 3, all Spot Bitcoin ETFs, including Grayscale's GBTC, recorded inflows for the first time since their launch, with a combined influx of $378 million, signaling renewed investor interest in the crypto market.