Web3 startup funding has seen a 92,7%decline since the last quarter of 2021, according to analysis by BanklessTimes.com.
In the fourth quarter of 2021, web3 startups raised a total of $9,8-billion through various funding rounds. However, in the third quarter of this year, that number dropped to just $719,7-million.
BanklessTimes CEO Jonathan Merry says: “The web3 startup ecosystem is in the early stages of development, and valuations are still being determined. Investors are becoming more cautious and are holding back on investments until they see more progress from these startups.”
One of the main reasons for this decline may be the bearish turn that the crypto market has taken since the beginning of the year. The price of bitcoin, which is often seen as an indicator of the health of the crypto market, has dropped by more than 50% since January. This has made it difficult for web3 startups to raise money through initial coin offerings (ICOs) and other forms of cryptocurrency-based fundraising.
Web3 startups face many challenges when it comes to fundraising. However, there have been some bright spots at the end of July. One of the most notable success stories is Unstoppable Domains, a blockchain startup that provides users with censorship-resistant domain