Reading · Deal Flow Digest

Gm!

Please enjoy the February Deal Flow Digest, a monthly newsletter recapping recent Crypto / web3 funding rounds.

Be sure to check out the Airtable below with ALL the deals, and the recent hackathon/demo day results (in the links).

Every February, the crypto world converges on Denver for ETHDenver.

This year saw an impressive 17,000 attendees—all deep in conversation about the state of crypto.

In 2024, the ETHDenver atmosphere felt euphoric, with “supercycle” echoing through venues. Fast-forward to this year, and the mood was noticeably more subdued.

Still, there were a few clear takeaways, especially for teams looking to raise funds:

Fewer eye-catching projects
There aren’t many new 0 to 1 concepts (although there are SOME, yes).
Token launches
Expect numerous token launches in the coming months. Note: retail participation is VERY thin, leaving low-float/high-FDV tokens (especially) struggling to find bids.
Attention and loyalty are harder than ever to attract / retain
Blockchain teams need to work harder to secure (and retain) top builders. It’s harder than ever to attract attention and even harder to build loyalty.
Regulatory optimism in the U.S.
Despite market fatigue, there’s tangible excitement around a more favorable U.S. regulatory climate. Everyone seems unanimously pissed about the TRUMP / MELANIA tokens though.
Burnout amongst the OGs
Many long-time players in the space show signs of exhaustion or capitulation.This was exacerbated since it was ETH Denver. SOL / BTC has had a good run but in general the feeling is that institutions have made more than crypto OGs this cycle which doesn’t feel great in general.
Side Events are out of control.
The explosion of side events is splitting attention and resources among the same insular crypto crowd. How on earth are all these older / dead projects with minimal on-chain activity affording these marketing spends??
VCs are active, but cautious.
Proven / repeat founders still are getting plenty of attention with their new projects. Some are now looking at secondary markets rather than new projects. Note: If you’re building something innovative and here for the long-term, my DMs are always open :)

Overall, sentiment feels more bearish than it probably should.

There’s little reason to think we’ve “topped” this cycle in general. I think Chris Burnike really put it well with his tweet:

“It looks to me like alts led BTC, BTC led equities. Equities might have some more shaking out to do, but remember this: BTC and cryptoassets are the fastest horses in finance, to the downside and upside. If equities go soft enough, measures will be taken to avoid any major or systemic weakness, because Trump's favorite scoreboard is the stock market -- and cryptoassets will feel those measures most acutely.
If you get out of crypto due to fear, or trying to be too cute, you will get whiplash on the other side of this. Don't listen to the traders that are always perfect - they're liars. People making significant money rarely brag about how much money they make. I make mistakes all the time, but a key for me has always been staying significantly allocated to multi-decadal growth stories. In a sense, I always go partially down with the ship, while storing some reserves in lifeboats when times are good (read: take profit the next time you feel an urge to gloat).”

Yes, mini retail narratives like AI and meme coins might have peaked for now, but major institutions continue to show strong interest in the broader crypto asset class. We may see “insider crypto” events shrink while more institution-focused conferences (like Blockworks DAS) draw bigger crowds. If that happens, fundamentals could finally take center stage, valuations might normalize, and teams will be pushed to develop actual product-market fit rather than relying on speculative hype.

Either way, for the teams we need to build real products, push the industry forward, and strive to evolve PMF beyond the current “gambling game.” That’s how this space will truly expand and endure. Looking forward to seeing what happens from the First “Crypto Summit” at the US White House this week.

Figure | Undisclosed | CeFi | $200.00M | 2025-02-26
Figure is a technology platform powering an efficient, liquid, blockchain-based marketplace for financial products, and Sixth Street, a leading global investment firm, announced the formation of a new joint venture vehicle. Sixth Street's Asset-Based Finance platform has committed to invest $200 million in equity, with the commitment being recyclable for future Figure private credit loan production.

Ethena | Strategic | DeFi | $100.00M | 2025-02-23
Ethena has secured $100 million through a private sale of its ENA tokens. Its stablecoin, USDe, has grown significantly since its launch a year ago, ranking among the largest globally. The funding will support the development of a new token tailored for traditional financial institutions.

Bitwise | Undisclosed | CeFi | $70.00M | 2025-02-24
Bitwise has completed a $70 million funding round from top financial institutions and technology investors as it continues building the leading crypto asset management firm.

Raise | Strategic | Others | $63.00M | 2025-02-25
Raise raised $63 million in a strategic financing round, backed by Haun Ventures, GSR, Paper Ventures, and others. In total, five investors participated in the round.

Blockaid | Series B | Web3 | $50.00M | 2025-02-17
Israeli onchain security platform Blockaid announced the completion of a $50 million Series B round led by Ribbit Capital, with participation from Google Ventures and existing investors, including Variant and Cyberstarts.

HashKey Group | Strategic | CeFi | $30.00M | 2025-02-13
Gaorong Ventures invested $30 million in HashKey Group, the operator of Hong Kong's biggest licensed crypto exchange. This marks a rare example of a Chinese venture powerhouse entering the $3 trillion digital asset space.

Taproot Wizards | Series A | Others | $30.00M | 2025-02-03
Taproot Wizards raised $30 million in a Series A round backed by Standard Crypto, cyber Fund, Geometry Research, and others.

Prime Intellect | Undisclosed | Infrastructure | $15.00M | 2025-02-27
Prime Intellect is building a peer-to-peer protocol for compute and intelligence, enabling collective creation, ownership, and access to sovereign open-source AI. The $15 million funding will fuel its vision of decentralizing AI compute power.

Olas | Undisclosed | Others | $13.80M | 2025-02-03
Olas has raised $13.8 million to support the launch of its agent app store, allowing users to own and control their AI agents on-chain.

Mango Network | Undisclosed | Infrastructure | $13.50M | 2025-02-13
Mango Network raised $13.5 million in an undisclosed financing round backed by CatcherVC, KuCoin Ventures, and others.

Beamable | Series A | Infrastructure | $13.50M | 2025-02-03
Beamable secured $13.5 million in a Series A round led by Bitkraft Ventures to expand the Beamable Network, a Decentralized Physical Infrastructure Network (DePIN) reducing reliance on centralized hyperscalers in gaming.

VCs are continuing to announce their new raises. We did this month too :)

As a reminder, if you are interested in learning more about Bankless Ventures Fund II, please fill out this form and we will be in touch!

2025-02-18: Bankless Ventures Launches Fund II to continue in investing in early-stage crypto startups.
2025-02-03: TVM Launches $100M Fund, a $100 million initiative dedicated to expanding the ecosystem of TON blockchain as a global financial network.
2025-02-04: StarkWare launches $4 million venture fund to foster the growth of blockchain startups in Africa. The fund is a testament to StarkWare’s belief in the potential of blockchain in Africa, a continent historically underserved by traditional institutions, to drive global crypto adoption.
2025-02-19: The Somnia ecosystem will benefit from a major financial boost with up to $270M in combined capital from Improbable, M², and the Virtual Society Foundation, backed by leading investors such as a16z, SoftBank, Mirana, SIG, Digital Currency Group and CMT Digital.

Upcoming

ETHGlobal Taipei | April 4 - 6
Taipei/Virtual. $100k in prizes.

Start in Block | April 8 - 10 (Paris Blockchain Week)
Paris/Virtual. $10M in prizes.

Ongoing

evm/accathon | February 24 - March 12
Denver/Virtual. $50k in prizes.

Finshed (results in links)

World Build Hackathon | February 6-8, 2025

Sui Agent Typhoon | January 31- February 10, 2025

Agentic Ethereum | January 31- February 14, 2025

One Trillion Agents (Winners TBA) | January 31- March 2, 2025

Upcoming

Techstars Web3 Demo Day | 5th June 2025