In Q1 2024, there was a notable surge in venture capital funding for the crypto industry, marking the first significant increase since the onset of the crypto winter in 2022.

The cryptocurrency sector experienced a resurgence in venture capital activity in early 2024, indicating a potential rejuvenation of investor confidence post the bear market.

As per Chainalysis' "The 2024 Crypto Spring Report," Q1 2024 witnessed the first quarter-over-quarter rise in crypto investment since early 2023, suggesting a potential shift in the investment landscape within the crypto industry.

Throughout 2023, there was a steep decline in capital raised by cryptocurrency firms, aligning with the crypto winter that began in 2022. Following a near $10 billion peak in Q4 2022, quarterly crypto funding volumes dipped below $2.0 billion in Q2 2023.

In Q1 2024, crypto VC volumes saw an increase for the first time since 2022, nearing $2.5 billion. Additionally, the median deal size rebounded from a sharp decline in Q4 2022, consistently hovering around $10 million.

Despite an overall decline in VC activity in crypto during 2023, the industry witnessed several significant deals surpassing $100 million, including early-stage deals spanning Q3 2023 into Q1 2024.

According to Chainalysis, the most prominent deals were led by blockchain interoperability projects Wormhole and Together.ai. Wormhole secured a $225 million investment in November 2023, while Together.ai also raised $225 million during the same period.

In late 2023, Swan Bitcoin, a crypto asset management and taxes platform, secured a $165 million investment, while major cryptocurrency exchange service Blockchain.com received $110 million funding in November 2023.

Other noteworthy VC deals highlighted by Chainalysis include Totter, an open-source cloud storage platform, and the Ethereum protocol EigenLayer, raising $101 million and $100 million, respectively.

The surge in crypto VC deals coincided with a significant rally in the cryptocurrency market in early 2024, with Bitcoin hitting new all-time highs of $73,600 in mid-March. This rally was primarily attributed to the launch of spot Bitcoin exchange-traded funds in the United States in January 2024.