US-based crypto startups attracted 45% of all venture capital funding invested in the crypto industry, followed by the United Kingdom claiming 7.7% and Singapore with 5.7%.
Despite facing regulatory scrutiny in the United States, crypto firms continue to innovate, with nearly half of all capital investments flowing towards U.S. crypto businesses, according to a recent report.
Published by crypto investment firm Galaxy Digital on July 14, the report stated that US-based crypto start-ups had a significant share of interest from venture capital firms.
“US-based crypto startups accounted for more than 43% of all deals completed and raised more than 45% of the capital invested by VC firms.”
This was followed by the United Kingdom claiming 7.7% of capital investment, Singapore with 5.7% and South Korea with 5.4%.
However, it was noted that the total amount of capital invested in crypto and blockchain startups continued to decline quarter on quarter.
“Only $720m was raised by 10 new crypto VC funds in Q2 2023” it noted, pointing out that this is the lowest since the beginning of the COVID-19 pandemic, in Q3 2020.
“Crypto and blockchain startups raised less money across the last three quarters combined than they did in just Q2 last year.”
It was further noted that while companies in the “broad Web3 category” had more deals, companies in the “trading category” raised more capital.
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This comes amid the United States Securities and Exchange Commission taking action against a number of U.S. crypto firms in recent times.
Most recently, its case against Ripple, alleging that its native token XRP (XRP) is a security, was ruled partially in favor of Ripple on July 13, stating that it is not a security for retail sales.
Cointelegraph previously reported on June 18 that Ripple CEO Brad Garlinghouse believes the SEC is “looking to kill” innovation and the cryptocurrency industry in the U.S.
Garlinghouse argued that its handling of the Hinman speech documents during the Ripple case isn’t about “any one token or any one blockchain,” but more so the overall stance that the SEC has towards the crypto industry.
This comes after the SEC took action against major crypto exchanges Binance and Coinbase only a day apart on June 5 and June 6, alleging a violation of securities laws and offering unregistered securities.
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