In 2022, the implosion of some of the crypto's biggest players sent shockwaves across the industry, leading to a downward spiral in the cryptocurrency markets which saw Bitcoin, the preeminent cryptocurrency, declining by more than 65%. The overall crypto market capitalisation also shrunk by US$1.4 billion, with investors flocking towards less-risky assets amid the worsening macroeconomic conditions.
Despite the unfortunate developments, 2022 was still a record year for crypto Venture Capital, with the industry witnessing the highest yearly venture funding at US$30.9 billion, according to data from The Block. However, VC funding declined significantly by the end of the year, with volumes decreasing to the 2020 levels.
Investors are understandably more cautious about investing in Web3, and investments from crypto VCs, which have always been an indication of the level of bullishness within the crypto markets, could well move into the slow lane in 2023.