It is no longer required to mention the news that negatively affected 2022, one thing is certain though, the bearish market conditions have also overturned the amounts collected by companies in the crypto world.
CoinGecko recently published a market analysis comparing the funding of companies involved in the crypto sector. The amount in 2022 is $21.26 billion, about 42% less than in 2021.
Looking at the two years, the figure seems worrying, but if we look further afield, the figure remains up from the years 2018, 2019, and 2020. This is a sign that the sector is continuously growing if not very steady.
Crypto: declining 2022 funding is not necessarily bad news
If we were to go back and assess the funding received by companies in the crypto sector in 2019, we would see a more drastic decline than in 2018.
In fact, in 2019 companies raised only $4.48 billion, a 72% drop from $16.22 billion in 2018. 2020 remained stable compared to 2019, with $4.40 billion in total.
These figures, give us the certainty that the market from 2021 onward is growing steadily, investments have increased by far, and although they are not constant they remain high. The new projects that have sprung up ensure strong interest in the investment community, there is more support and more assurance.
The cryptocurrency world can be said to have moved to the next step, much more concrete.
The investment trend on the crypto sector in 2022
CoinGecko’s analysis shows that cryptocurrency sector funding has been getting smaller and smaller each quarter of 2022.
In the first quarter, the money raised amounted to about $8.72 billion.
In subsequent quarters, the decline has been sharper, with the second quarter seeing revenue of $5.92 billion, the third quarter $3.61 billion, and finally the fourth and final quarter with $2.99 billion.
The reasons may be very clear: in May 2022, the collapse of the Terra ecosystem happened, and towards the end of the year there was the FTX crisis that affected the whole market.
It was all also determined by external factors, such as inflation, the geopolitical situation, which affected the entire 2022 market, bringing us into a bearish market situation.
The same cannot be said of 2021, which saw a gradual increase in financing as the months progressed, with the peak reached in the summer where the DeFi of the same year exploded.
Thus, we can clearly specify that external events, news, crises and collapses, are factors that influence the market in no small part, but also individual investments. The willingness to invest is driven by the securities and guarantees of the industry.
CoinGecko shared its analysis thanks to data collected by cryptocurrency company DefiLlama, which collected data from 2018 to 2022.
These market analyses give us a better understanding of the cryptocurrency sector and its dynamics.
The year 2023 is shaping up to be one in which many issues left unresolved in the past year will find resolution.
Many countries are moving to regulate the world of cryptocurrencies and blockchain technology in the best of all worlds.
The companies involved, are working on the transparency of their liquidity to give more assurance to investors. The green subsector of cryptocurrencies is trending.
In fact, 2023 will be the year of revolutions on emissions and pollution.
New projects are emerging with new features and new growth stimuli.
Companies that turned out to be somewhat fraudulent are paying their penalties.
So, it has been a very optimistic start to the year, and it will certainly proceed in the right direction if all plans turn out.