💵 State of Crypto VC

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Hey! You made it to Friday. Nice.

A quick note about yesterday’s email: I was wrong. 

ETH is actually in its longest bull market on record, going from the trough of the previous bear market until today. It’s now been almost 1,200 days since it bottomed out in June 2022 (not November!). 

It also means that ETH has never taken this long to reach all-time high. Slow and steady, amirite? 

Although, I can't say the same for VCs — they’re going as hard as ever.

💼 The deals must flow

First, the really bullish stuff.

Pantera Capital managing partner Paul Veradittakit just put out a State of Crypto Venture Capital report with plenty to prick up your ears.

First, the industry is on pace to break 2021’s fundraising record of $29.17 billion. Crypto companies this year have raised over $16 billion — which is already more than the total deal value of 2024.

(BTW: Very cool that Veradittakit’s report is grounded in Blockworks Research data, which covers all things deal flow, including fundraising, M&A and debt financing.)

Veradittakit characterizes this year’s fundraising as a game-changer fueled by record M&A and IPO activity. 

He wrote: “2024 was a record year for acquisitions with over 100 mergers and acquisitions (M&A) totaling $1.73 billion and 2025 is set to surpass 2024 in deal count. From January to July of this year it is already at 76 deals and $6.23 billion, which is 3.6× 2024’s full-year dollar volume and is on pace for 130 deals if the current run rate holds.”

“The momentum in 2025 is less about unleashing pent‑up demand and more a sign of the industry’s natural maturation,” Veradittakit added.

Crypto IPO successes like Circle and Bullish, as well as others coming up (including Figure and BitGo) are making new entrants more comfortable with investing in the blockchain industry. 

“This is a pattern seen in other major technological shifts, where a multi-decade build-out precedes explosive growth,” per Veradittakit.

Over on the Empire podcast, Rob Hadick, general partner at Dragonfly Capital, floated the notion that raises like M0’s $40 million and Rain’s $58 million Series Bs were probably the “tail end of the fervor” that came just before the Genius Act rolled out in June.

“I can tell you right now, there's definitely some fatigue,” Hadick said. 

Interestingly, Hadick pointed out that the level of entrepreneurs that are now building in stablecoins is increasing. 

One deal that Dragonfly is looking at right now involves founders that were executives at “some of the largest payment companies in the world and they just know how money flows — we haven’t seen that level of entrepreneur before.”

“And so I think we'll see this kind of dip in the market, and then we're going to see new novel, awesome entrepreneurs, an acceleration into maybe the end of the year [and] next year,” Hadick said.

— David Canellis

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• Binance Futures markets were knocked offline for around 25 minutes earlier this morning.

• Eric Trump is in Hong Kong at the Bitcoin Asia conference, and reportedly labeled China “the other Bitcoin superpower” alongside the US (not wrong!)

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Last week, we asked: What is the most obvious recent top signal?

Half of you said: “I see no top signals, only bear traps.” Congrats, you passed the test.

This week, we want to know: