Web3 and crypto sectors suffered a massive downfall in 2022 with blockchain projects crumbling and investments almost freezing. Raging crypto winter deterred investors and a number of VC deals paused for a moment. Although the crypto winter had its fair share of downturns, it cleared the industry from getting rich quickly kind of investors. The declining figures pushed short-term fast money grabbers out of the market. Moreover, it also opened up the path for sustainable development. As for the investments, surprisingly, the data was the complete opposite in 2022. It shows that VC investors still believe in Web3.
Additionally, Robert Le, a senior analyst at PitchBook, reports that venture capital investors continue to have faith in Web3. In Q3 2022, VCs invested approximately $1.5B into Web3 companies. Although funding has decreased compared to 2021, Web3 remains an attractive area for investors. Moreover, investors and experts view Web3 as having significant potential.
Top 5 Web3 VC Deals in the Spotlight
Mysten Labs ($300M)
Mysten Labs received promising VC funding led by FTX and raised a whopping $300M. Established in 2021, the startup aims to speed up the adoption of Web3. Its plan is to offer infrastructure support through its Sui blockchain. Moreover, the Series B funding round was supported by prominent investors including a16z crypto, Apollo, Binance Labs, Coinbase Ventures, among others. Mysten Labs is working on two projects; Sui blockchain, and Move. Sui is a horizontally scalable, proof-of-stake blockchain with decentralized throughput and storage capabilities. Move is an open-source language with the aim of creating smart contracts.
M2 or Msquared ($150M)
M2’s funding round, led by Andreessen Horowitz and SoftBank Vision Fund 2, raised $150M and was supported by other Web3 and crypto investors. This startup, launched by Improbable, a metaverse technology company, was created with the goal of establishing a network of interoperable metaverses. So, its mission is to enhance metaverse experiences and bring interconnected virtual worlds to reality.
Layer Zero Labs ($135)
A funding round co-led by Sequoia Capital, FTX Ventures, and Andreessen Horowitz raised $135M and was supported by other leading venture capital firms. This Web3 startup aims to bring together decentralized applications across multiple blockchains. Furthermore, it plans to achieve this by unlocking a borderless future in the process, according to Ryan Zarick, the CTO and co-founder. With its omnichain dApps, users can interact with applications existing on multiple blockchains, without even realizing that communication is happening seamlessly through LayerZero.
Magic Eden ($130M)
A Series B funding round co-led by Electric Capital and Greylock Partners raised $130M. Magic Eden's NFT marketplace, launched only 1.5 years ago, saw its valuation reach $1.6 billion in June 2022. COO Zhuoxun Yin commented, "These numbers only further validate the market and industry we're in, showing that there's strong investor interest in investing in this market."
The company received $100M in Series A funding from SRAM & MRAM Group, valued at $1.5 billion. Moreover, 5ire is a Web3 startup, a 5th-generation Layer-1 blockchain network, and the fastest-growing unicorn in India. According to CEO and Founder Pratik Gauri, the company is on a mission to integrate sustainability into blockchain and change the focus from "for-profit" to "for-benefit.
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