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VCs Invest Over $2 Billion in Early 2026: Which Sectors Benefit?

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Crypto Fundraising in Early 2026. Source: CryptoRank

As capital flows sharply out of the crypto market in early 2026 and investor sentiment remains at extreme fear levels, venture capital allocation decisions have become a valuable signal. These moves help retail investors identify sectors that may still hold potential during a bear market.

Recent reports indicate that the crypto market environment has changed. The sectors attracting VC funding have shifted accordingly.

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VCs Invest Over $2 Billion in Crypto in Early 2026

Data from CryptoRank shows that venture capital firms have invested more than $2 billion into crypto projects since the beginning of the year. On average, weekly inflows have exceeded $400 million.

Crypto Fundraising in Early 2026. Source: CryptoRank
Crypto Fundraising in Early 2026. Source: CryptoRank

Several large deals stand out. Rain raised $250 million to build enterprise-grade stablecoin payment infrastructure. BitGo secured $212.8 million through its IPO, reinforcing its role as a digital asset custodian and security provider for institutional clients.

BlackOpal also raised $200 million for its GemStone product, an investment-grade vehicle backed by tokenized Brazilian credit card receivables.

Top Funding Rounds For Crypto VCs in Early 2026. Source: Alex Dulub
Top Funding Rounds For Crypto VCs in Early 2026. Source: Alex Dulub

Beyond these deals, Ripple invested $150 million in trading platform LMAX. The move supports the integration of RLUSD as a core collateral asset within institutional trading infrastructure. Tether also made a $150 million strategic investment in Gold.com, expanding global access to both tokenized and physical gold.

Analyst Milk Road notes that capital is no longer flowing into Layer 1 blockchains, meme coins, or AI integrations. Instead, stablecoin infrastructure, custody solutions, and real-world asset (RWA) tokenization have emerged as the dominant investment themes.

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Market data supports this shift. Since the start of the year, total crypto market capitalization has fallen by roughly $1 trillion. In contrast, stablecoin market capitalization has remained above $300 billion. The total value of tokenized RWAs has reached an all-time high of over $24 billion.

What Does the Shift in VC Appetite Signal?

Ryan Kim, founding partner at Hashed, argues that VC expectations have fundamentally changed. The shift reflects a new investment standard across the industry.

In 2021, investors focused on tokenomics, community growth, and narrative-driven projects. By 2026, VCs will prioritize real revenue, regulatory advantages, and institutional clients.

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“Notice what’s absent? No L1s. No DEXs. No ‘community-driven’ anything. Every dollar went to infrastructure and compliance,” Ryan Kim stated.

The largest deals listed above involve infrastructure builders rather than token-driven projects designed to generate price speculation. As a result, the market lacks the elements that previously fueled hype cycles and FOMO.

“Not on speculation. Not on hype cycles. They’re looking at the pipes, rails, and compliance layers,” analyst Milk Road said.

However, analyst Lukas (Miya) presents a more pessimistic view. He argues that crypto venture capital is in a state of collapse, citing a sharp, sustained decline in limited partner commitments.

He points to several warning signs. High-profile firms such as Mechanism and Tangent have shifted away from crypto. Many firms are quietly unwinding their positions.

It may still be too early to declare the collapse of crypto VC, given that more than $2 billion has flowed into the sector since the start of the year. At a minimum, these changes suggest that crypto is integrating more deeply with the traditional financial system, a potential sign of long-term maturation.

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Crypto World

Crypto Scam Leader Extradited to China to Face Charges

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Crypto Scam Leader Extradited to China to Face Charges

Li Xiong, a key member of a group that allegedly helped crypto scam rings in Asia to move money, has been extradited from Cambodia to China, where he will face fraud and money laundering charges, according to Hong Kong-based news outlet Ta Kung Wen Wei.

On April 1, with strong support from the relevant authorities in Cambodia, a task force sent by China’s Ministry of Public Security successfully escorted Li Xiong, a core key member of the Chen Zhi criminal syndicate, back to China from Phnom Penh, Cambodia,” it said on Wednesday, citing a statement from China’s Ministry of Public Security on WeChat.

Xiong previously served as chairman of Huione Group, an alleged criminal organization that served scam centers in Cambodia that carried out “pig butchering” scams and other investment schemes to steal crypto from victims around the world. 

Huione Group was responsible for one of the largest illicit online marketplaces in the world, handling over $89 billion in cryptoassets.

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Source: Jacob in Cambodia

His extradition comes three months after the arrest of Chen Zhi, the head of Prince Group, which operates Huione Group. In October, it was reported that the US Department of Justice seized 127,271 Bitcoin (BTC) worth more than $15 billion from Zhi.

Related: Hong Kong retiree loses $840K in triple ‘crypto expert’ scam

The US Treasury Department’s Financial Crimes Enforcement Network directed US banks to cut payments and accounts tied to the Huione Group in October.

Authorities ask other Huione members to surrender

Ta Kung Wen Wei noted that several other members of Zhi’s criminal syndicate have been brought to justice “one after another,” citing comments from Chinese public officials.

“Public security authorities will continue to intensify efforts to capture fugitives,” it said, adding:

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“At the same time, they once again warn criminals to recognize the situation, stop before it is too late, surrender as soon as possible, and strive for lenient treatment.”

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