The cryptocurrency market is gaining massive backing from venture capitalists and other investors. Last year’s market rally convinced several investors to enter the cryptocurrency space, and this year crypto service providers are seeing increased support. As a result, crypto investments in the first quarter of 2021 have already surpassed the total investment the market received last year.
2021 investment surpasses 2020 amidst a massive rally
The second quarter of 2021 has just begun, and the cryptocurrency market is already setting a record. Earlier this year, the leading cryptocurrency set an all-time high above the $61,000 mark, while Ethereum also rallied to an all-time high above $2,000.
The rally is not limited to the cryptocurrencies’ prices. The number of investments in cryptocurrency have surged over the past year. A report by Bloomberg yesterday revealed that investments obtained in the first quarter of 2021 exceeded those for all of 2020.
This data suggests that more venture capitalists have been pouring money into cryptocurrency service providers since the start of this year. According to data obtained from CB Insights, in the first quarter, 129 startups in the blockchain sector raised roughly $2.6 billion. This figure is already higher than the $2.3 billion raised through 341 deals last year.
The surge was due to the vast amounts of funding collected by startups such as BlockFi Inc., game-maker Dapper Labs Inc., and crypto wallet provider Blockchain.com.
Massive investment coincides with a huge market rally
The massive investment in cryptocurrency-related companies coincides with the market experiencing a huge rally. Tesla, MicroStrategy, and a host of other companies have invested billions of dollars into the cryptocurrency market, helping push BTC’s price to a new all-time high above $61,000.
Furthermore, Coinbase Global Inc., the largest U.S. crypto exchange, is close to getting publicly listed on the NASDAQ stock exchange. All these developments contribute to the cryptocurrency market recording a stellar year since the Coronavirus pandemic affected the global financial markets last year.