In May, the cryptocurrency sector attracted more than $1 billion in investments, albeit slightly lower than the previous month’s influx. According to a report from KuCoin’s research division, there were 156 publicly announced investments, totaling $1.02 billion injected into the crypto market.
Compared to May 2023, this represented a 10.61% upswing, but it also denoted a 6.4% downturn from April’s figures. Institutional investors predominantly favored Ethereum, Ethereum Virtual Machine (EVM) chains, and layer-2 (L2) network projects.
Nevertheless, non-EVM chains such as Bitcoin, Solana, Fantom, and TON also secured spots among the top 15 networks preferred by investors in May.
Animoca Brands and OKX Ventures Become Most Active Investors
The report emphasized Animoca Brands and OKX Ventures as the most prominent investors throughout the month. Animoca Brands participated in 15 deals, while OKX Ventures backed 11 projects.
Additionally, other notable investors such as Cogitent Ventures, SNZ Holding, and DWF Labs were active with 10, 8, and 7 deals, respectively.
KuCoin Research indicated a shift in investor focus due to concerns about low float and high fully diluted valuations (FDV) in the crypto market. Consequently, attention turned toward meme and celebrity tokens.
The report indicated that certain market players explored alternatives, directing attention towards lesser-known low-market-cap assets and emerging narratives. Notcoin (NOT) emerged as one token benefiting from this shift in investor sentiment.
KuCoin highlighted that NOT’s unique launch strategy, with all tokens available from the outset, fueled its growth in May. On June 3, NOT rose to become the fifth most-traded cryptocurrency, surpassing the trading volume of the popular stablecoin USD Coin.
Achieving a new all-time high of $0.02896 on June 2, NOT’s price surge propelled its market capitalization above $2 billion.
Crypto Fundraising Reaches $2.4B in Q1 2024
The cryptocurrency market witnessed a remarkable surge in fundraising, soaring to an impressive $2.4 billion in the initial quarter of 2024, propelled by a shift in market sentiment and fresh capital inflows.
Throughout the first quarter, a total of 518 deals valued at $2.3 billion were sealed within the cryptocurrency sector, marking a substantial 40.3% surge in investments compared to the preceding quarter. This surge signifies a significant advancement for the industry, especially considering the heightened on-chain activities observed in Q4 of 2023.
Moreover, deal volume, representing the number of transactions, experienced a notable rise of 44.7% in the preceding quarter.
April’s funding amounted to $1.02 billion spread across 161 investment rounds, slightly lower than March’s figures of $1.09 billion across 186 rounds.
The approval of spot Bitcoin exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC) in January played a pivotal role in enhancing institutional investors’ access to the crypto asset class. This decision, following years of unsuccessful applications, has simplified the inclusion of cryptocurrencies in institutional portfolios.
