While the cryptocurrency market is struggling to recover, the decline in crypto investments also continues. Leading cryptocurrency research firm Messari reported that the crypto winter hit crypto investments in the third quarter and that investments in the sector have fallen to the lowest level in the past three years.
According to Messari’s report titled “The State of Crypto Investments,” crypto companies were able to raise investments just below $2.1 billion with 297 deals made in the third quarter. This amount corresponds to the lowest level seen since the fourth quarter of 2020.
Investments, which reached a peak of about $17.5 billion with over 900 deals in the first quarter of 2022, decreased throughout the year due to worsening conditions in the crypto sector and the unexpected collapse of FTX, the world’s second-largest cryptocurrency exchange, in November 2022, which reached the peak of fear.
However, fundraising activities continued in the first and second quarters of 2023. Approximately $7.5 billion was invested in around 200 deals in both quarters, parallel to the fourth quarter of 2022. There was a 36% decline in crypto investments in the third quarter.
Furthermore, Messari highlighted that investors are now focusing on early-stage projects and infrastructure projects rather than user-oriented applications. An early-stage project is generally the first stage of a project. At this stage, the project concept is formed, and the basic requirements are determined. The early-stage project defines the purpose, scope, and goals of the project. It also determines important parameters such as project budget and timeline. The early-stage project is used to provide an understanding among project owners, designers, and other relevant parties and to create a framework for more detailed work in the later stages of the project.
An infrastructure project refers to the project where the infrastructure of a region, place, technology, or system is designed and built. These types of projects are important projects aimed at improving the quality of life of a community or region. Infrastructure projects usually require long-term planning and involve a range of complex factors such as engineering skills, environmental factors, and financing.