Crypto Venture Funding Sinks to Second-Lowest Level Since 2020
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Crypto venture funding continued its downward trend in Q2 2025, with investors committing $1.97 billion across 378 deals, according to data from Galaxy Research.
The quarter marked the second-lowest level of funding since 2020, underscoring the cautious stance of venture capital firms toward blockchain and Web3 startups.
The slowdown follows a sharp decline from the record-breaking investment cycle of 2021–2022, when quarterly totals peaked at over $13 billion.
Deal count has also fallen significantly, with just 378 deals closed in Q2 compared to more than 1,200 at the cycle’s height.
Analysts suggest that the weak venture environment reflects a combination of regulatory uncertainty, tighter liquidity conditions, and investor preference for profitability over speculative growth. While capital remains available, it is increasingly concentrated in projects focused on infrastructure, tokenization platforms, and AI-integrated crypto applications.
Despite the slowdown, Galaxy noted that historically, periods of muted venture funding often precede the next wave of market expansion. With Bitcoin and Ethereum prices stabilizing, many expect capital flows to re-accelerate once clarity around regulation and broader adoption strengthens.
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