40% of crypto trading platforms are decentralized: World Federation of Exchanges

September 5, 2023 Coin Telegraph

The World Federation of Exchanges noted in a report that retail demand is higher for crypto products but there's a lack awareness on investor protection.

A report from the World Federation of Exchanges (WFE) noted that 40% of the crypto trading platforms are decentralized and make use of distributed ledger technology. On the other hand, the majority, or 60%, of platforms make use of Central Limit Order Books (CLOBs), quite similar to regulated exchange platforms.

The WFE report noted that there are a total of 500 crypto trading platforms offering various crypo linked products and services. The survey saw participation from several crypto platforms offering key insights into retail and institutional demands.

The report noted that many crypto platforms opted to rely on an off chain CLOB system for price oracles, quote display and order execution. These entities only use the blockchain for settlement and custody purposes This means traders do not interact directly with the DLT, which eventually helps in saving on transaction cost. In this way, the transaction fees only apply when orders are settled on the blockchain. Crypto-trading platforms with this type of arrangement are called centralized platforms (CEX).

According to the survey, retail demand for crypto-linked products and services is higher compared to institutional demand, except for custody services. Institutional giants have shown a greater requirement for crypto custody services, and demand is higher. Based on the different types of product demands by the two segments of investors, the report estimates that retail customers are less aware about the importance of investor protection.

Talking about the liquidity and customer demand, the report found that centralized exchanged enjoy a higher trading activity despite decentralized platforms offering lower transaction fees. The report also shed light on the difference in price for same trading pairs on different platforms, leading to arbitrage opportunities. However, the WEF report claimed this type of price fluctuation highlights a potential inefficiency issue in the crypo market.

The report further found that despite most countries imposing know-your-customer requirements, both centralized and decentralized crypto trading platforms have fallen short in implementing such measures due to lack of uniform crypto regulations.

Magazine: How to protect your crypto in a volatile market: Bitcoin OGs and experts weigh in

Canadian crypto ownership declined amid tight regulations, falling prices

August 4, 2023 Coin Telegraph

Bank of Canada

The biggest motivation for Canadians interested in Bitcoin is an investment — as showcased by the choice of over one-third of the 4,996 respondents in the Bank of Canada's 2022 survey.

The Bank of Canada (BOC) reported a decline in the ownership of Bitcoin (BTC) and cryptocurrencies in the country last year as neither market conditions nor regulations sided in the favor of Canadian crypto investors, according to a BOC study published last week.

The annual Bitcoin Omnibus Survey (BTCOS) conducted by the Canadian central bank showed a relapse from the massive crypto adoption witnessed in 2021.

*Bitcoin awareness and ownership in Canada, 2016 to 2022. Source: Bank of Canada*

The above graph shows that — halfway into 2022 — Bitcoin ownership in Canada declined to 9% by August. Although BTC adoption saw a slight uptick to 10% by the end of the year. However, the drop in Bitcoin ownership does not imply that investors were spreading out their investments into other cryptocurrencies. The report read:

“Investors did not appear to shift out of Bitcoin and into other cryptoassets, as we observe decreased ownership of altcoins.”

The biggest motivation for Canadians interested in Bitcoin is an investment — as showcased by the choice of over one-third of the 4,996 respondents in the BOC survey.

*Percentage of Canadians who own Bitcoin, 2016 to 2022. Source: Bank of Canada*

Most Canadians acquired their crypto holdings through mobile and web apps. Bitcoin and crypto mining became the third-most-popular method of accumulating tokens for the second consecutive year.

When it comes to the altcoin ecosystem, Dogecoin (DOGE) was the most sought-after crypto investment considering the Elon Musk-induced hype and its history of randomly skyrocketing in price. Ether (ETH), Bitcoin Cash (BCH) and Litecoin (LTC) were some of the other popular altcoins for Canadians.

According to the BOC, the research is relevant for monitoring the two conditions that could warrant the issuance of an in-house central bank digital currency (CBDC): “if Canadians almost or do stop using cash, or if Canadians widely adopt and use private cryptocurrencies for payments.”

Hey Canada, we need your input!

Our public consultation on a potential #DigitalCanadianDollar is now LIVE. #HaveYourSay by June 19: https://t.co/p8BdG3tQ9h pic.twitter.com/vKRoBfAngu
— Bank of Canada (@bankofcanada) May 8, 2023

BOC highlighted that ecosystem collapses, along with regulatory hurdles and price depreciation contributed to the decline in crypto ownership. However, considering the government’s intent to provide regulatory clarity combined with a stable market, the crypto ownership in the region is expected to pick up as well.

Magazine: Deposit risk: What do crypto exchanges really do with your money?

Coinbase Q2 earnings beat estimates amid Blackrock custody deal, institutional focus

August 3, 2023 Coin Telegraph

Brian Armstrong

The company beat estimates while non-trading revenue beat trading revenue.

New York-based crypto exchange Coinbase reported revenue in the amount of $708 million in the second quarter of 2023, despite the regulatory issues it's faced in recent months, boosted by a custody deal with Blackrock and institutional focus.

The exchange said Q2 net revenue reached $663 million, down 10% versus the same period last year, yet beating early estimates on its growing market dominance in the United States as competitors such as Binance are bogged down by regulatory trouble.

The crypto exchange’s impressive performance was also attributed to the strong crypto price cycle last quarter where the likes of Bitcoin and other altcoins posted new yearly highs.

Early estimates from the Zacks Consensus Estimate put crypto exchange’s earnings at $643.4 million, a 20.4% decline from the past year during the same time. Another report from Messari suggested that for the first time, Coinbase's non-trading revenue may exceed its trading revenue.

According to Coinbase, the predictions were correct. Non-trading revenue for Q2 2023 reached $335.4 million against transaction revenue of $327.1 million for the quarter.

Tristan Greene contributed to the story.

This is a developing story, and further information will be added as it becomes available.

Meta Q2 earnings: Reality Labs losses top $7.7B year to date

July 27, 2023 Coin Telegraph

Meta Q2 earnings: Reality Labs losses top .7B year to date

Meanwhile, Meta's metaverse-building business has racked up around $21 billion in losses since the start of 2022.

Meta's metaverse-related losses topped $3.74 billion over the second quarter with the Big Tech player spending $7.7 billion on its virtual reality business so far in 2023.

Its second-quarter 2023 results released on July 26 saw Meta report an 11% revenue gain compared to the same quarter last year, totaling $31.9 billion.

Its metaverse-focused Reality Labs revenue topped $276 million, its lowest in two years and a nearly 40% drop compared to Q2 2022.

*Meta's segment results in millions since Q2 2021 with* *added* *highlights on Reality Labs' Q2 2023 revenue and operating losses. Source: Meta*

On an earnings call, Meta's financial chief Susan Li said Reality Labs' revenue drop was due to lower sales of its Quest 2 virtual reality (VR) headset. The department's expenses were up 23% to $4.0 billion partly caused by a growth in staffing costs.

Reality Labs' operating losses are set to increase through 2023, Meta said. It cited VR-related product development efforts and further investments in its metaverse as the reason for the losses extending.

On the call, Meta chief Mark Zuckerberg said the firm is focusing on artificial intelligence "in the near term and the metaverse over the longer term."

He reiterated Meta is "fully committed" to its metaverse alongside its AI investments and said the two areas are "overlapping and complementary."

He added its AI model Llama is being used to build a number of products that will help users "create worlds and the avatars and objects that inhabit them as well" and said he would share more later in the year.

Meta's stock price jumped on the earnings and is up over 7% in after-hours trading to around $320 according to Google Finance data. Meta shares have gained nearly 140% year-to-date but are still off from their September 2021 all-time high of over $378.

*Meta's stock price spiked to over $320 in after-hours trading on July 26. Source: Google Finance*

Zuckerberg mentioned its July 6 launched platform Threads was “seeing more people coming back daily than I’d expected” and said Meta was focused firstly on Threads user retention, then growth and would later focus on monetizing the platform.

The comments come the same day as a July 26 report from data analytics firm Similarweb that claimed Threads users have declined 60% from launch.

Threads peaked at 49 million daily active users on July 7 but fell to 12.6 million daily active users by July 23 with users spending less than five minutes a day on the app over the past week.

Web3 Gamer: Apple to fix gaming? SEC hates Metaverse, Logan Paul trolled on Steam

Crypto VC funding tumbles as economic uncertainty scares off investors

July 21, 2023 Coin Telegraph

Coin Telegraph

June rejected the three-month trend of rising venture capital investment into crypto, though that’s not necessarily a bearish signal.

The month of June closed out with a 29.73% decrease in venture capital investments, with just $779.32 million raised in 62 individual deals, according to data from the Cointelegraph Research Venture Capital Database. While the United States Federal Reserve halted interest rate hikes in June, the macroeconomic climate remains unchanged due to geopolitical uncertainties and continued efforts to tame inflation across the globe. As the data shows, investors remained cautious and in risk-off mode in June, with the growth trend of the previous three months coming to a halt.

Purchase access to the Cointelegraph Research VC Database.

However, that is not necessarily a bearish signal, as the overall trend for 2023 is still upward. Plus, the recent batch of Bitcoin exchange-traded fund (ETF) applications from the likes of BlackRock, VanEck, WisdomTree and Fidelity as well as Ripple’s legal victory over the Securities and Exchange Commission have helped brighten the mood. The crypto market instantly reacted to those positive events, but VC investments are always a lagging indicator, as institutions tend to be more inert and cautious. It is also important to note that VC activity may be tempered by the uncertainty of overall global economic conditions.

Blockchain infrastructure still dominant

The Cointelegraph Research Venture Capital Database reveals that the breakdown of deals in June didn’t drastically change and that the investment focus of VCs remained relatively stable. Blockchain infrastructure still led the market with 20 individual deals and over $493 million in funding.

Decentralized finance (DeFi) won back some ground with 20 deals and over $144 million invested. Surprisingly, Web3 was less popular for venture capitalists in June, with about $107 million over 18 deals. Centralized finance (CeFi) and nonfungible tokens (NFTs) again closed out the list with about $32 million and $2 million of investment and one and three individual rounds, respectively.

The largest deal in June was Islamic Coin’s (ISLM) $200 million raise from Alpha Blue Ocean’s ABO Digital. The project aims to create a digital financial instrument for Muslims around the globe, and its total funding has surpassed $400 million. Far behind Islamic Coin was the $43 million Gensyn deal led by a16z Crypto with participation from CoinFund, Canonical Crypto and others. Gensyn is a blockchain-based artificial intelligence project connecting buyers and sellers of compute power.

Another entry on the list is Mythical Games, which raised $37 million in Series C deal led by Scytale Digital with participation from ARK Invest, Animoca Brands and others. The funds will be used to launch a new marketplace and pursue other revenue-generating initiatives. Bitpanda Pro, meanwhile, closed a Series A round for $33 million led by Peter Thiel’s Valar Ventures and rebranded to One Trading. The round will help expand its reach to professional traders and institutions throughout Europe.

While March, April and May saw VCs increase their capital inflows into the blockchain space, the trend was rejected in June, signaling that more uncertainty may lie ahead. However, slight deviations month-to-month are less important than the overall trend, which is steadily rising. With the spot ETF fillings and Ripple-SEC lawsuit yet to impact the crypto venture capital market, July and August are expected to offer indications of which will have greater weight — general macroeconomic conditions or crypto market hype events.

To keep on top of VC activity, follow the Cointelegraph Research VC Database, which is updated weekly and tracks over 6,000 deals from 2012 through the present day.

Bitcoin miners hedging with recent sell-offs – Bitfinex report

July 19, 2023 Coin Telegraph

Bitcoin

All-time high hashrates and mining difficulty indicates that miners are bullish on Bitcoin, while recent sell-offs could be a means to hedge positions.

Bitcoin (BTC) mining companies are employing derisking strategies by offloading Bitcoin to exchanges, according to a market report from Bitfinex.

The cryptocurrency trading platform’s latest newsletter addresses the Bitcoin mining sector at length, highlighting a recent surge in miners selling large volumes of BTC to exchanges. This has led to a corresponding increase in value of shares in Bitcoin mining companies as institutional interest in BTC picks up in 2023.

The report notes that Poolin has accounted for the highest amount of BTC sold to the market in recent weeks. Bitfinex analysts also note that the Bitcoin mining difficult recently hit an all-time high, which it labels as an indicator of “robustness and miner confidence”:

“Miners are clearly bullish on Bitcoin as they commit more resources to mining, hence triggering the mining difficulty, but they are hedging their position, hence the despatch of more Bitcoin to exchanges.

The report goes on to suggest that miners are hedging positions on derivatives exchanges, with 70,000 BTC in 30-day cumulative volume transferred in the first week of July 2023.

While miners historically transfer BTC to exchanges using derivatives as a hedge for large spot positions, the report labels the high volumes as uncharacteristic:

"A transfer to exchanges on this scale is extremely rare and potentially showcases new miner behaviour.”

Bitfinex also cited data from Glassnode that indicated that Poolin has been responsible for a large portion of this activity, with the BTC mining pool offloading BTC to Binance.

The analysts note that several plausible reasons could be behind recent mining behaviour. This could include hedging activities in the derivatives market, carrying out over-the-counter orders or transferring funds through exchanges for other reasons.

Bitcoin mining difficulty and corresponding market price. Source: Blockchain.com

The increase in mining difficulty is also indicative of new mining power being added to the Bitcoin network. Analysts suggest that this is seen as a sign of increased network health, as well as increased confidence in the profitability of mining, either by increased BTC prices or improved hardware.

“Thus, miners are at a peculiar situation where they are rapidly increasing their mining potential as the Bitcoin halving inches closer whilst simultaneously hedging their exposure to an extent which is higher and more cautious than previous cycles.”

The report also suggests that on-chain Bitcoin movements reflect a transfer of supply from long-term holders to short-term holders. This investor behavior is said to be commonly seen in bull market conditions, as new market traders look for quick profits while long-term holders capitalize on increased prices.

Cointelegraph has reached out to a handful of mining companies and pools to ascertain why Bitcoin outflows from miners have increased over the past month. As recently reported, miners sent over $128 million in revenue to exchanges at the end of June 2023.

Magazine: Bitcoin is on a collision course with ‘Net Zero’ promises

How the spot Bitcoin ETF filings affected the crypto industry in June: Report

July 7, 2023 Coin Telegraph

Coin Telegraph

The competition among zk-Rollup-based scaling solutions is tightening while the security tokens market continues steadily.

The news surrounding BlackRock’s application for a spot Bitcoin (BTC) exchange-traded fund (EFT) sent the asset’s price from its local lows in mid-June to a strong monthly close of +12%. To most observers, this was a sign that institutional investment into the cryptosphere is once again on the horizon. A future approval of a spot ETF combined with rate cuts from the United States Federal Reserve could provide the ideal catalysts for the next bull run.

For those keen to gain a deeper understanding of the crypto space’s various sectors and their fundamental trends, Cointelegraph Research publishes its monthly “Investor Insights Report,” which dives into venture capital, derivatives, decentralized finance (DeFi), regulation and much more. This month, Cointelegraph Research examined how various sectors reacted to the bullish news surrounding BlackRock’s ETF filing with the U.S. Securities and Exchange Commission.

The report is available for free on the Cointelegraph Research Terminal.

While crypto-related stocks, especially those of mining ventures, immediately benefitted from the news, other sectors traditionally tied closer to altcoin activity, such as DeFi, continued in bear-market mode unperturbed.

Zk-Rollups race heating up ahead of next bull run

Many suspect that novel layer-2 scaling solutions for Ethereum will be among the big gainers in the next bull run. However, the competition in the space is tight. Zero-knowledge (ZK) rollup technology, which allows a shortened summary of transaction batches and smart contract executions to be submitted to the chain, will arguably be the biggest area of innovation in this crypto market cycle.

ZkSync Era’s ZK Stack, Polygon zkEVM and StarkWare’s Starknet have all been in the news for their recent or newly proposed innovations. But what does the data say about the relative success of these projects?

In June, Polygon zkEVM outperformed zkSync and Starknet in terms of growth in total value locked (TVL), gaining an impressive 71% month-over-month. However, it still lags an order of magnitude behind the dominant zero-knowledge protocol, zkSync, which currently has a TVL of $120 million.

The recent growth of zkEVM can be attributed to the slew of DeFi protocols it has attracted — such as QuickSwap, Balancer and SushiSwap — with many more in the pipeline. These and other recent developments are discussed every month in the DeFi section of the Cointelegraph Research Monthly Trends Report.

Security tokens market chugs along unperturbed

Security tokens are a remarkable sector of the industry in that they seem to have continued their modest but steady growth throughout the bear market, apparently unphased by the ETF filings that rocked the rest of the market.

During the first half of the year, the total market capitalization of security tokens rose from $14.93 billion to $16.76 billion, as seen in the figure below. The 1.65% growth seen in June was connected to several notable deals and security token offerings (STOs).

Though the development of tokenized securities is controversial in the crypto community, banks such as Citigroup and Bank of America have predicted that the tokenization of real-world assets may drive trillions of dollars to blockchains in the future. While most securities offerings currently involve real estate, other types are quickly gaining pace. With a section on STOs, Cointelegraph Research’s monthly Investor Insights Report covers this lesser-known part of the crypto industry — one that may ultimately grow into a multitrillion-dollar sector.

The Cointelegraph Research team

Cointelegraph’s Research department comprises some of the best talents in the blockchain industry. Bringing together academic rigor and filtered through practical, hard-won experience, the researchers on the team are committed to bringing the most accurate, insightful content available on the market.

Demelza Hays, Ph.D., is the director of research at Cointelegraph. Hays has compiled a team of subject matter experts from finance, economics and technology to bring the premier source for industry reports and insightful analysis to the market. The team utilizes APIs from various sources to provide accurate, useful information and analyses.

With decades of combined experience in traditional finance, business, engineering, technology and research, the Cointelegraph Research team is perfectly positioned to put its combined talents to proper use with the latest Investor Insights Report.

The opinions expressed in this article are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.

How to use DeFi the right way — This latest guide can help

June 26, 2023 Coin Telegraph

Coin Telegraph

This latest report is a guide to help the next generation of cryptocurrency users and veterans alike in the ways of decentralized finance.

The cryptocurrency market saw an explosion of growth during the 2021 decentralized finance (DeFi) Summer and increased fear of missing out (FOMO), which drove prices of Bitcoin (BTC) and much of the cryptocurrency market to all-time highs. During that time, the total value locked (TVL) across DeFi rose to nearly $180 billion before crashing down to earth.

After the past few weeks of the BTC price crossing the $30,000 threshold, some are speculating if the market is gearing up for another bull run. That could signal interest from both veterans of past cycles and those new to crypto to get interested in DeFi, and Cointelegraph Research’s latest report is here to help give insights to past, present and future DeFi users.

Download the report on the Cointelegraph Research Terminal.

“Investing in DeFi: A Comprehensive Guide” report is a perfect start for those new to blockchain, giving an overview of DeFi. Throughout the report are links and references to all the useful resources and tools to help individuals conduct their own due diligence before investing in anything. Cointelegraph Research and Cointelegraph Markets Pro collaborated on several areas of the report to bring tips and tricks to help DeFi users with fundamental analysis to help mitigate the risks associated with investing in cryptocurrencies.

More growth for DeFi in the near future?

Before investing in DeFi, it would be important to know the potential for the sector to grow if there is increased interest in the future. If we look at the chart below of DeFi’s dramatic rise during the 2021 DeFi Summer, it would seem to indicate that there is plenty of room to grow to at least the levels achieved during the last bull cycle.

There is no guarantee that the crypto markets will replicate the move, but it does indicate that there was at one point a market appetite for DeFi at these levels. The question potential investors have to ask themselves is: “Is there more or less adoption today than in the past?” and “Could there be more or less adoption in the future than today?”

So many tools, so little time

Unlike the early days of cryptocurrency, there is a multitude of different tools and applications at DeFi participants’ fingertips. It would be impossible to put all of the different solutions that have been founded and launched into one chart.

The illustration below serves as a starting point for DeFi investors to begin researching the different protocols and possible investments in the cryptoverse. Cointelegraph Research’s latest report is a starting place to help bring new people into the world of DeFi.

The Cointelegraph Research team

Michael Tabone is the deputy director of research at Cointelegraph. The research team comprises subject matter experts from across the fields of finance, economics and technology to bring the premier source for industry reports and insightful analysis to the market. The team utilizes APIs from a variety of sources in order to provide accurate, useful information and analyses.

Robust crypto fundamentals pull through after May’s monthly red candle: Report

June 23, 2023 Coin Telegraph

Bitcoin

What are the current trends in VC investment in the crypto sector, and when will the bear market finally end?

In May, Bitcoin (BTC) posted its first monthly loss since December 2022 with a negative 6.98%. However, this consolidation was not obviously driven by a change in fundamentals or the broader macroeconomic environment. The crypto market was looking for direction and liquidity in this phase before the United States Federal Reserve announced a pause on the rate hiking cycle in June.

Many indicators, such as the futures market and VC investment, point to an optimistic underlying sentiment. But while traditional markets and tech stocks were able to continue their rally in May, actual price action in the crypto market remained suppressed and took some time to spring from its woodworks.

The report is available for free on the Cointelegraph Research Terminal.

For those keen to gain a deeper understanding of the crypto space’s various sectors and their fundamental trends, Cointelegraph Research publishes a monthly Investors Insights Report that dives into venture capital, derivatives, decentralized finance (DeFi), regulation and much more.

Mining stocks rally, while VC activity shows signs of life

Blue chip crypto stocks also saw a strong month posting a month-over-month return of 7%. Mining operations and other established ventures continued to benefit from the previous phase of the market’s recovery back in March. The most notable gains were again made by mining stocks. After the explosion of TeraWulf’s evaluation, Bit Digital followed suit, and its stock rose by an astonishing 77% after mining operations in Iceland were announced.

Many overleveraged mining companies had been battered throughout the bear market due to tightening credit conditions and decreasing BTC prices, which now gives competitors a chance to rapidly raise evaluations. As most now expect Bitcoin to already have hit its low for the current cycle, new mining facilities with low electricity prices and the newest hardware appear less risky to investors than other sectors of the crypto market.

Meanwhile, according to Cointelegraph Research’s Venture Capital Database, VC investment surpassed $1 billion for the first time since September 2022 last month. It rose by 34% from April, and 81 deals were recorded. This is the third consecutive uptick in VC investment, but it is unclear if this means activity will rise sustainably from bear market levels. In a greater context, inflows remain below one-fourth of bull market levels.

BTC sees strongest network activity of the bear market

Historically, there have been many ways to inscribe data on the Bitcoin blockchain. For a long time, the most popular options were OP_Return scripts, which formed the backbone of Omni and Counterparty nonfungible tokens (NFTs). However, through a loophole introduced via the Taproot scripting language, the recently hyped-up Ordinals protocol permits much larger inscriptions — in theory, up to 4MB.

After the addition of fungible, so-called BRC-20 tokens to the Ordinals protocol, the Bitcoin network experienced its first significant fee spike since 2021. This was a positive for miners, who benefitted from spikes in revenue. The ratio of fee revenues to total mining revenues briefly hit its second-highest level in history at 43% on May 8. In the weeks after, it dropped to around 5%, which is still significantly elevated from levels at the start of the year.

It remains to be seen whether the recently added feature to migrate ERC-721 tokens from Ethereum to the Bitcoin blockchain can revive the hype, or if fee revenues will fade back into insignificance within the greater context of mining economics. The mining section of the Cointelegraph Research Monthly Trends report provides a monthly round-up of quantitative mining metrics and will monitor this development closely.

The Cointelegraph Research team

Crypto VC market flashes green amid macroeconomic recession alarms

June 20, 2023 Coin Telegraph

Coin Telegraph

May 2023 marked the second consecutive month of crypto VC activity growth, surpassing $1 billion in funding for the first time since September 2022.

Crypto venture capital investments were on the rise for the second month in a row in May despite the generally declining economic backdrop. Funding amounts surged 34% from April, and the number of individual deals jumped 62%, according to data from Cointelegraph Research’s Venture Capital Database.

Though inflation in the United States cooled from 4.9% in April to 4% in May — down from 9.1% in the summer of 2022 — the U.S. Federal Reserve still raised interest rates 10 consecutive times. Decreasing inflation tends to build trust among investors that inflation is controllable and that Federal Reserve measures will become softer, but the market is still in the waiting phase.

Purchase access to the Cointelegraph Research VC Database.

On June 14, the Fed announced it would pause interest rate hikes, which may become a bullish signal for financial markets, with crypto no exception. Cointelegraph Research’s Venture Capital Database reveals that the crypto VC market saw $1.1 billion in investments in May, the first month to surpass the $1 billion mark since September 2022, with June set to serve as a crucial benchmark for continued growth in VC investment trends.

Blockchain infrastructure is still on top

Breaking down May’s deals, the infrastructure sector still leads the market in capital inflows with $783.9 million in 23 rounds, over 68% of the total invested money. In terms of the number of deals, Web3 is on top with 24 deals conducted, but seeing only $170.1 million in funding. Decentralized finance lost ground in May, with 20 deals and $93.6 million raised. Centralized finance was not attractive for VCs, having only two deals at $24.8 million in total.

The top raisers in May included infrastructure solutions developers Worldcoin and Auradine alongside Web3 project Magic. Worldcoin’s $115 million Series C round saw the participation of Spark Capital, Zoom Ventures, Sound Ventures, Salesforce Ventures, Menlo Ventures and Google and was aimed at promoting World App, its custodial solution, and World ID, its decentralized identity solution.

Blockchain privacy and security provider Auradine raised $81 million in a Series A round with the backing of Marathon Digital Holdings, Celesta, Mayfield, Cota Capital and DCVC to promote the “next-generation web infrastructure” with artificial intelligence and zero-knowledge-proof solutions.

Web3 development and tooling project Magic got a $52 million Series B deal with PayPal Ventures and Volt Capital as backers, among others. The funds are intended to expand the company’s integration in European and Asia-Pacific markets.

As of June, the Fed’s streak of 10 consecutive interest rate hikes has ended. That may turn investment strategies back to risk-on, as short-term adjustments to interest rates significantly impact how capital is invested in both the traditional and decentralized finance spaces. However, VC activity is a lagging indicator and may experience tailwinds in the background of the news. To keep on top of VC activity, follow the Cointelegraph Research VC Database, which is updated weekly and tracks over 6,000 deals from 2012 through the present day.

report

Blockchain infrastructure still dominant

Zk-Rollups race heating up ahead of next bull run

Security tokens market chugs along unperturbed

The Cointelegraph Research team

More growth for DeFi in the near future?

So many tools, so little time

The Cointelegraph Research team

Mining stocks rally, while VC activity shows signs of life

BTC sees strongest network activity of the bear market

The Cointelegraph Research team

Blockchain infrastructure is still on top

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