It has been a disaster year for the crypto sector and the prices are now far below the level of not very long ago. It is therefore perhaps surprising that the crypto sector is still the most popular investment sector. Other emerging technologysectors, such as fintech and biotech, have to outperform the crypto sector in terms of the amount of investment. This is evident from a report from pitch book.
Crypto remains popular
Investments in emerging technology sectors fell for the third quarter in a row. With a total of 4.7 billion dollars, that is a lot less than 6.9 billion in the second quarter. But crypto is holding up relatively well in terms of investments. The research shows that investments in decentralized finance (DeFi) and Web3 platforms are doing particularly well.
The investments within the crypto sector that took the lead were made in the blockchain projects Mysten Labs and Aptos Labs. These raised 300 and 200 million dollars respectively. But the startup Flow stood out with a $ 350 million investment round.
A total of $6.5 billion has flowed into crypto, DeFi and Web3 sectors in the past 12 months. This puts investments in crypto land head and shoulders above the number two in emerging tech sectors: fintech. Financial technology brought in $2.9 billion in the same time frame.
FTX drama reverberates
An analyst from Pitchbook indicated that investments in the crypto sector will most likely decline somewhat in the coming quarters. This has everything to do with the unfortunate developments regarding the imploded exchange FTX.
“The strong level of investment in the sector indicates strong interest from investors. The recent fiasco of the failed crypto exchange FTX and the subsequent fallout in the industry will have a negative impact on future investment levels.”
However, the analysts also indicated that certain areas in the crypto sector will feel the impact of FTX less. Platforms working on blockchain technology in particular will continue to do well, according to the report.