Crypto and Blockchain Funding Sees Significant Growth in Q1 2025, Driven by Binance
By Chris Metinko | April 4, 2025
Funding Landscape Transformed
Venture funding in the crypto and blockchain sectors, collectively referred to as Web3, experienced a remarkable surge in the first quarter of 2025. According to data from Crunchbase, investment in this space more than doubled compared to the previous quarter, driven in part by easing regulatory concerns and, notably, a substantial $2 billion investment into the well-known crypto exchange Binance.
In total, Web3 startups raised an impressive $3.8 billion across 220 deals, marking a 138% increase from the $1.6 billion secured in 242 deals during the prior quarter. This growth indicates heightened enthusiasm among investors towards the crypto landscape, particularly in light of favorable regulatory shifts anticipated under the new White House administration.
The Binance Factor
The dramatic uptick in funding can largely be attributed to a single transaction: Binance’s recent $2 billion round led by Abu Dhabi-based investment firm MGX. This investment sets a new record as the largest ever in a cryptocurrency company, surpassing previous landmark deals such as FTX’s $1 billion Series B and NYDIG’s $1 billion private equity round, both executed during the market’s high-flying past.
Accounting for this massive round, traditional funding in the Web3 sector was approximately $1.8 billion last quarter—reflecting activity comparable to the more subdued funding seasons of late 2024. Market Dynamics and Deal Flow
Despite the eye-catching dollar amounts, total deal activity has not followed suit. The first quarter of 2025 saw fewer than half the number of closed deals than the same quarter in the previous year, indicating a cautious approach among investors in what remains a volatile market.
Yet, large transactions have continued to occur. For instance, San Francisco-based Phantom, a startup specializing in crypto wallets, successfully raised $150 million in a round featuring prominent investors like Paradigm and Sequoia Capital, reaching a valuation of $3 billion. Additionally, Paris-based Flowdesk, which provides crypto-financial services and trading infrastructure, secured $91.8 million in venture funding.
Regulatory Environment Shift
The current political climate has shifted significantly regarding cryptocurrency in the United States. Under President Donald Trump, who signed an executive order aimed at establishing a U.S. strategic bitcoin reserve, expectations for regulatory flexibility are on the rise. Despite this optimism, cryptocurrency prices have not reflected similar vigor, with Bitcoin and Ether witnessing declines of 9% and 43% respectively in Q1 2025. Furthermore, news reports suggest potential financial ties between the Biden administration and Binance, creating additional speculation. It has been reported that members of President Trump’s family may consider financial investments in Binance, coinciding with the launch of discussions about a dollar-pegged stablecoin by the Trump-affiliated World Liberty Financial.
Looking Ahead
Despite the rollercoaster ride of the crypto market, there appears to be emerging momentum in the Web3 sector. Some companies are bracing for public offerings, with Circle, a prominent stablecoin issuer, recently announcing plans for an IPO, while eToro, a trading platform encompassing various asset classes, filed for its own initial public offering last month.
As the Web3 ecosystem continues to evolve amidst fluctuating fortunes, the upcoming IPOs will likely draw significant investor attention and scrutiny, signaling the industry’s uncertain but potentially lucrative future.
Methodology
Crunchbase’s analysis of Web3 funding encompasses investments made into VC-backed startups within the cryptocurrency and blockchain domains.
Stay informed on recent funding rounds and acquisitions by subscribing to the Crunchbase Daily.
For more insights into the Web3 and crypto markets, including detailed funding reports, visit Crunchbase’s Web3 Tracker.
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