Despite the decline in the global fintech market, the cryptocurrency and blockchain sectors have emerged as leaders in major European markets. According to a report published by Finch Capital, while fintech investments in the EMEA region decreased by 50%, crypto businesses are taking the lead in countries such as the United Kingdom, the Netherlands, Germany, and France.
Fintech Investments Experience a 50% Decline
According to the “State of European FinTech” report published by Amsterdam-based fintech venture fund Finch Capital, the EMEA region experienced a 50% decline in fintech investments in the first half of 2023. The total funding amount decreased from $27.3 billion in the first half of 2022 to $11.2 billion in the first half of 2023.
However, crypto businesses stand out in the overall picture and gain a leading position in investments in several major markets. In the United Kingdom, the blockchain and cryptocurrency sector accounted for 28% of all fintech deals in the first half of 2023. This number is even higher in the Netherlands, where 35% of all deals took place in the crypto and blockchain sector. In Germany and France, the share of the crypto sector was reported as 27% and 29%, respectively.
Growing Interest in the Crypto Sector
The rival of the crypto sector in terms of deal volume is the lending sector, which is seen as the leader in market share in Ireland and the region as a whole. Despite the overall downward trend in the fintech market, investor interest in the cryptocurrency sector remains strong.
According to a recent report, 24% of asset management firms have adopted a crypto asset strategy, and 13% plan to adopt a strategy within the next two years. Furthermore, some crypto companies report significant earnings, such as European crypto asset manager CoinShares, which announced a 33% increase in total revenue to £20.3 million ($25.9 million) in the second quarter of 2023 compared to the same quarter of the previous year.
