Crypto Funding Rises 50%, But Most Startups Are Shutting Down: Analysts
Three deals last February consumed almost half of all crypto money raised that month. There are only three of them. That single fact tells you more about where crypto funding currently stands than headline numbers.
A Shrinking Pool for Big Bets
According to data from research firm Messari, total crypto fundraising increased nearly 50% in the 12 months ending March 2026 compared to the previous year.
But the number of individual deals fell by 46% over the same period. A few cycles. Big checks. The average deal size reached $34 million – a 272% jump from last year. The number of active investors fell by almost a third, down to 3,225.
Those three February highlights were Tether’s $200 million investment in online marketplace Whop, the $75 million Series B for sports prediction platform Novig led by Pantera Capital, and the $70 million Series B for ARQ, a Latin American fintech app built around stablecoins, backed by Sequoia Capital. Together, they accounted for 44% of the nearly $800 million raised for the month.
It has been a very difficult year for crypto fundraising. Most of the capital has gone into major strategic rounds
Outside @dragonfly_xyz we haven’t seen many big VCs close new rounds (a16z and Paradigm are active but not closed)
The industry needs new capital pic.twitter.com/N8N58p6yvt
– Eric Turner (@eric_turner) March 8, 2026
Messari describes the pattern as late-stage capital focus and strategic mega-rounds. A few well-positioned companies are pulling in huge sums of money while smaller players are taking risks.
Early fundraising, reports say, is still active but scattered. Messari led Interstate’s $1.5 million round, which attracted more than 15 backers — a mix of firms like Bloccelerate VC and individual angel investors. That kind of discrete, small-dollar work happens in volume. But it exists in a different world to the title-holding mega-rounds.
Five-year trend of monthly crypto fundraising changes. Source: Messari
The VC Drought Nobody’s Talking About
Here is the part that the article buries. Messari’s CEO Eric Turner flagged a problem beyond the deal’s statistics: apart from Dragonfly Capital, no major crypto venture company has recently closed a new fund. Dragonfly has closed a $650 million fund with a focus on real-world assets, but is largely independent. Turner put it bluntly – the industry needs new money.
BTCUSD trading at $68,749 on the 24-hour chart: TradingView
Crypto Investors Stay Active As New Currencies Drop
That is important because business funds have a shelf life. Firms raise a fund, use it for several years, and then raise it again. When a new fund closes, the money flowing into the deals eventually ends as well.
A 50% year-over-year profit may look strong on paper, but given the potential of existing pools that can be replenished at the same rate.
Coinbase Ventures, QUBIC Labs, and Somnia are ranked as the three most active crypto investors in the past three months, based on Messari data.
Featured image from In Coinchart from TradingView
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