Many experts agree that the cryptocurrency market has entered a long bearish phase. One of the factors reflecting the fears of investors was a sharp reduction in funding for blockchain startups.
According to the results of the second quarter, venture capital investments in this business segment fell to the lowest level since 2021.
As Bloomberg clarifies concerning a PitchBook study, in the first quarter, venture funds invested a record $9.85 billion in crypto business, and in the second quarter this amount fell to $6.76 billion, and as analyst Robert Le predicts, according to the results of the third quarter, the amount of capital investment will be even lower.
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Investors hesitate to invest in infrastructure development. They fear that the bearish phase in the market will drag on. A serious blow to the attractiveness of the crypto business was caused by the collapse of the Terra ecosystem and problems at Celsius and Babel Finance, as well as large-scale layoffs at Gemini, Crypto.com, and other exchanges.
David Packman, representing venture capital firm CoinFund, is urging investors to switch to a wait-and-see strategy. You need to hold out for about two years, after which the industry will again begin to add and activate activity in the cryptosphere.