While the largely unregulated ICO boom of 2018 raised $7.8 billion, initial coin offering funding fell more than 95% to raise $371 million in 2019. By contrast, equity funding raised $2.8 billion last year.
The report also notes the rise of decentralized finance (DeFi), noting that there are currently more than $1 billion in assets on DeFi platforms — up from $300 million as of January 2019.
Crypto firms are a major source of DLT funding
2019 saw 807 venture deals signed, only a slight drop from 2018’s 822. However, the total sum raised fell roughly 30% from $4.26 billion in 2018 to $2.79 billion last year.
VC activity is up significantly when compared with 2017 — which saw $1.25 billion raised from 297. However, the average sum raised by blockchain companies was higher in 2017 with $4.22 million — compared to $3.45 million in 2019.
The data also demonstrates “crypto companies’ commitment to funding their own ecosystem,” with NEO Global Capital and Coinbase Ventures comprising the two-most active VCs in the space during 2019.
U.S. share of blockchain funding share declines year-over-year
In 2015, U.S. blockchain funding represented 51% of the global total, compared to China’s 2%. In 2019, the U.S. accounted for 31% while China had grown to 22%.
However, 2019 also saw a rise in funding from emerging blockchain hubs, with both the U.S. and China seeing a slight decline in market share compared to 2018’s 34% and 27%, respectively. 2019 was the first year in which China’s share of global DLT funding decreased.