Private Businesses Purchasing the Dip to Help the Cryptocurrency Market

Although the markets are faltering, the cryptocurrency business gets significant funding from private funds raised this year. There have been at least 36 crypto-related fund rounds totaling more than $100M this year, despite 2022’s bleak financial performance. According to Arcane Research’s latest weekly analysis, there will be the ten largest cryptocurrency capital fundraisers this year.

The Cryptocurrency Market Is Being Pumped Up By Private Capital

More than half of LFG’s $10B goals to underpin the UST algorithmic stablecoin with a significant BTC reserve have now been reached. It puts the company at the forefront of the greatest cryptocurrency sector capital acquisitions this year. Additionally, Luna Foundation Guard and Terra Labs bought $100M worth of Avalanche tokens to welcome them to the UST reserve warmly.

A financing round of $550M for Fireblocks, an institution-focused cryptocurrency platform, also makes a strong showing. It is possible to move, store, and issue digital assets with the help of Fireblocks. It is used by approximately 800 financial organizations like banks, hedge funds, and trading desks in the form of the system and the MPC-based wallet.

The corporation highlighted Dan Sundheim, who stated that Fireblocks is now a crucial driver of cryptocurrency market development worldwide, with an anticipated 15% of daily cryptocurrency trading volume safeguarded by their technology,” in the official statement.

With this fresh round of funding, Fireblocks will be able to join the coming wave of firms into the cryptocurrency market. The Bahamas-based cryptocurrency exchange FTX recently achieved a $32B value after raising $400M in a Series C fundraising round. They’ve now raised almost $2B in just six months, according to FTX, who noted that this was their 3rd fundraising effort.

FX US, FTX’s American arm, also announced its $400M Series A financing round, which was made public. Additional information provided by FTX US stated that all investors participating in Series C financing immediately participated, which placed FTX US at around $8B.

USDC issuer Circle raised $400M this month, according to Arcane Research, which cited BlackRock Inc., Fin Capital, Fidelity Management and Research, and Marshall Wace LLP as the major contributors. The circle was valued at $9B after this round of funding.

SPACs and ICOs Have Outlived Their Usefulness

According to data from 2022, SPAC and IPO activity has decreased. The downturn in IPOs, according to EquityZen Co-Founder Phil Haslett, is because of many factors: With what’s going on in Ukraine, there’s a lot of unrest all over the world. Inflation is a worry for you. Furthermore, you’ve seen a significant drop in values across several industries, primarily in technology. 

When you combine all of these factors, you have a lot of uncertainty, kryptonite for initial public offerings. SPAC mergers are projected to undergo greater scrutiny because of the SEC’s current proposal for SPAC, IPOs, and de-SPAC transactions’ new rules and changes, which raised roughly $145B last year.

Companies will no longer be able to be acquired via a SPAC due to the new regulations. SPAC mergers as a tool for getting private corporations public became increasingly popular last year, with 613 SPAC listings in the United States. It contributed significantly to the year’s record number of IPO listings, accounting for 59% of all IPO listings, a 150% rise yearly for SPACs, and an 88% rise for IPOs.

According to Arcane Research, some businesses are canceling planned public offerings this year. As a result of the SEC’s suggestion, Citigroup has put its SPAC IPO on hold until more information is available. As the financial world continues to struggle, Arcane’s analysis wondered whether or not private funding will keep flowing into the cryptocurrency business.

Leave a comment