RootData: 2024 Web3 Industry Investment Research Report

Author: RootData Research

Abstract

• According to RootData statistics, the global cryptocurrency market capitalization saw significant growth in 2024, with a total financing amount of $10.112 billion for the year, an increase of 8.3% compared to 2023. A total of 1,548 financing events occurred throughout the year, with 102 mergers and acquisitions, setting a historical record; the infrastructure sector continued to lead with a financing scale of $3.995 billion.
• Early-stage investments (under $5 million) dominated, with 627 projects completed throughout the year, a 20.6% increase from 2023, and overall project valuations gradually returning to rational ranges; the total amount of the top ten transactions reached $3.028 billion, with payment giant Stripe acquiring the stablecoin platform Bridge for $1.1 billion, making it the largest single transaction; OKX Ventures became the most active investment institution in 2024 with 72 deals; Polychain led 30 projects throughout the year, focusing on infrastructure and DeFi sectors.
• The Ethereum ecosystem completed 282 financing rounds for a total of $1.78 billion. The number of projects in the Base and Solana ecosystems grew significantly, with growth rates of 164.8% and 69.6%, respectively. The growth rate of mature Layer 2 ecosystem dApps remained around 20%, showing a trend of self-sufficiency and independence from VC constraints.
• Infrastructure, Layer 1/2, and DeFi remain the hottest sectors in blockchain, while tags like artificial intelligence and DeSci are rapidly gaining traction. Large token unlocks are typically accompanied by positive news to boost prices, while OTC trading has minimal impact on token prices.
• The first half of 2025 will see a diversified development trend in the crypto market, with DePIN, RWA, AI, and consumer-grade infrastructure being key focuses for industry development. High-performance public chains like Solana and Move may show impressive performances. Meanwhile, the ETH ecosystem is steadily developing under regulatory integration, pushing the entire industry towards standardization and deeper integration with the real economy.

Total financing of $10.112 billion in 2024, an increase of 8.3% compared to 2023; the infrastructure sector achieved a financing scale of $3.995 billion

According to RootData statistics, the financing activities in the crypto market in 2024 showed a pattern of high at the beginning and low at the end, with a total financing amount of $10.112 billion for the year, an increase of 8.3% compared to 2023. The first quarter was the most active, with March alone completing $1.139 billion in financing, setting the highest for the year. The average monthly financing amount in the first half of the year remained above $900 million, while the second half stabilized around $700 million, closing December with $742 million.

In terms of the number of financing events, there were 1,548 events throughout the year, averaging 129 events per month. March reached a monthly high of 191 events, gradually declining afterward, with the average in the second half maintaining around 100 events. Notably, the number of mergers and acquisitions reached 102, a 34.2% increase from 76 in 2023, also setting a historical record. The average financing amount for the year was $9.1352 million, with a median financing amount of $4.1 million.

According to RootData statistics, the financing performance across various sectors in 2024 showed clear differentiation. The infrastructure sector continued to lead with a financing scale of $3.995 billion, an 18.22% increase from 2023, accounting for the largest share of total financing for the year, with significant growth in developer platforms and stablecoins in Q3. The DeFi sector performed outstandingly, with total financing reaching $1.493 billion, a significant increase of 96.57% compared to 2023, ranking second in financing scale, mainly concentrated in modular, parallel EVM, DePin, and RWA directions.

The gaming sector's financing scale reached $814 million, a year-on-year increase of 21.54%. Other category projects received $1.335 billion in financing, although this was a slight decrease of 6.72% compared to 2023, it included emerging fields such as the Meme sector, AI and Web3 integration projects, and DePin, with FHE, re-staking, and privacy computing performing actively at the beginning of the year, while security solutions and creator economies received more attention in Q3/Q4. Notably, the financing scale in the CeFi sector dropped from $991 million in 2023 to $679 million, a decrease of 31.48%, but saw a brief recovery mid-year due to projects like Farcaster.

Early-stage investments dominated in 2024, growing 20.6% compared to 2023; Top 10 financing totaled $3.028 billion, accounting for 29.94% of total financing for the year

From the financing distribution data in 2024, early-stage investments (under $5 million) continued to dominate, with 627 financing events occurring throughout the year, a 20.6% increase from 520 projects in 2023, reflecting a significant acceleration in new project layouts as the market warmed. Mid-stage investments ($5 million to $10 million) showed steady growth, with 244 projects completed in 2024, a 24.5% increase from 196 projects in 2023, while late-stage and large-scale investments (over $10 million) completed 188 projects, a slight increase from 175 projects in 2023. This change mainly stems from investors' increased risk aversion after experiencing the bear market cycle of 2022-2023, coupled with most funds completing fundraising in 2021, leading to increased demand for mid to late-stage project investments as exit periods approached.

In 2024, the top ten transactions in the Web3 financing market totaled $3.028 billion, accounting for 29.94% of the total financing for the year. Among them, payment giant Stripe's acquisition of the stablecoin platform Bridge for $1.1 billion became the largest single transaction, accounting for 10.88% of the annual total financing. Following that were Bitcoin mining company Iris Energy's $413 million financing and Avalanche's $250 million OTC financing. Additionally, multiple merger transactions reflected the trend of industry consolidation. These large transactions were mainly concentrated in infrastructure, mining, and Layer 1 sectors, demonstrating institutional investors' continued optimism about industry infrastructure development.

OKX Ventures became the most active investment institution in 2024 with 72 deals; Polychain led 30 projects throughout the year, focusing on infrastructure and DeFi sectors

According to RootData data, in the top 10 most active investment institutions in 2024, OKX Ventures topped the list with 72 deals, mainly focusing on infrastructure and DeFi sectors. Notably, OKX Ventures was also active in the gaming sector, making 34 deals. Following closely were MH Ventures and Cogitent Ventures, each with 56 deals. Overall, the infrastructure sector remained the most favored, with the top 10 institutions making over 38 investments in this area, while investments in DAO and tool information services were relatively low.

From the leading investment activity rankings, Polychain ranked first with 30 lead investments, clearly focusing on the infrastructure and DeFi sectors. The second place, Hack VC, made 24 lead investments, with 17 directed towards the infrastructure sector. Animoca Brands had 17 lead investments, with 8 directed towards gaming projects, showcasing its professional layout in the gaming sector. Overall, sectors like NFT and DAO showed a lukewarm performance in terms of lead investments, with most institutions having zero lead investments in these areas.

Base and Solana ecosystem projects showed leading growth, while mature Layer 2 ecosystem dApps maintained a growth rate of around 20%, showing a trend of self-sufficiency

According to incomplete records, Ethereum's total number of applications exceeded 2,500, still ranking first among public chains, and this ecosystem remains the most recognized infrastructure by investors and developers, completing 282 financing rounds for a total of $1.78 billion throughout the year.

Base and Solana ecosystem projects led the growth in the number of projects, with growth rates of an astonishing 164.8% and 69.6%, respectively. In addition to fast and low gas fees, experiments combining blockchain and AI have been significant factors driving the prosperity of public chains, with Virtuals Protocol and Pump.Fun attracting a large influx of capital.

In terms of financing capability, mature Layer 2 (such as Optimism and Arbitrum) showed lackluster data, but the growth rate of ecosystem dApps remained around 20%, demonstrating a trend of self-sufficiency and independence from VC constraints. Hyperliquid created a myth of a tenfold increase in FDV to $30 billion within a month after TGE without any financing.

Infrastructure, Layer 1/2, and DeFi remain the hottest sectors in blockchain, while tags like artificial intelligence and DeSci are rapidly gaining traction

Based on the popular tags from RootData over the past year (with over 5,000 clicks), infrastructure, Layer 1/2, and DeFi remain the hottest sectors in blockchain, while tags like artificial intelligence and DeSci are rapidly gaining traction, with representative projects like Virtuals Protocol and Bio Protocol consistently ranking high on RootData's popularity list.

Some high-click tags typically only maintain their popularity for 1-3 months, such as DePIN, Tap to Earn, and the Bitcoin ecosystem. Aside from the selling pressure from VC tokens, the lack of a good growth flywheel for the projects themselves may be one of the factors preventing sustained capital inflow.

Large token unlocks are usually accompanied by positive news to boost prices, while OTC trading has minimal impact on token prices

In 2024, VC tokens became a daunting term, as the crypto market bore the liquidity for their exits, with projects like Optimism, Sui, Aptos, Ethena, dydx, and Cardano unlocking over 30 million tokens each month. There were 9 significant unlock events (single transactions exceeding $100 million), including INJ, MEME, PYTH, AVAX, SUI, W, JTO, APT, and TIA.

Comparing token prices before and after unlocks, it was found that project teams could significantly boost token prices before large unlocks through early announcements of positive news and marketing. Additionally, OTC trading is the method with the least impact on token prices, mitigating the risk of significant price drops.

Popular TGE projects in H1 2025 will focus on BTC, artificial intelligence, and high-performance chains

Overview of popular TGE financing in H1 2025 (indicates TGE has been conducted)

• Projects with total financing exceeding $100 million include Monad, Farcaster, *EigenLayer, *Magic Eden, Berachain;
• Projects with total financing between $50 million and $100 million include Babylon, *Scroll, Morpho, Eclipse;
• Projects with total financing between $10 million and $50 million include Sahara, Nillion, *Movement, *Puffer, Initia, Walletconnect, *Usual, Lombard, Solayer, *Bio, Sophon;
• Projects with total financing less than $10 million include Roam, Symbiotic, *deBridge, *Grass.

Representative institutional investors include CEX institutions like Coinbase, Okex, Binance, and leading institutions like Polychain, Hack VC, IOSG, Robot Ventures, Paradigm, Variant, a16z, and Delphi Digital.

Token unlocks and altcoin performance in H1 2025 are influenced by tax season and macro liquidity

Macro and TGE price performance

Monad received the highest financing and support from 8 leading institutions, and is expected to launch on Coinbase, Binance, and Okex. After its launch, Eigen's TGE actual multiple reached 43 times, maintaining an excellent token price. The performance of $GRASS, $ME, and $MOVE, which launched on Binance in Q4, has been outstanding, with their launch multiples currently reaching 100-50, while $USUAL's base multiple and the last round have also reached 30 times. Layer 1 projects supported by 4 to 5 leading institutions showed varied performances, with high-performance narratives like Movement performing excellently, while the zero-knowledge proof narrative's $SCR base multiple performed poorly. Currently, high-traction narratives include high-performance public chains Eclipse/Monad/MegaETH, Ponzi liquidity narrative Berachain, chain abstraction Initia, artificial intelligence and privacy narratives Sahara and Nillion, and BTC narrative Babylon and Lombard.

Looking at the popular TGE situation in Q4, the market performed well in terms of liquidity unlocking on leading CEXs during the price rise of blue-chip tokens. On a macro level, Trump's inauguration in January and the return of institutional liquidity after Christmas suggest that TGE tokens released before the liquidity withdrawal during the tax season in March to April are likely to continue the prosperous scene of Q4 2024. Trump's and his WLF's support for the Ethereum + on-chain DeFi narrative and cash has also led to good token unlock performance for DeFi and dollar-pegged RWA-related concepts (such as $USUAL), and the narrative capabilities of unissued projects in these tags and sectors remain promising for 2025.

The OTC market in H1 2025 is led by Solana, focusing on high-performance narratives of the Move ecosystem

Overall, the OTC market quotation amounts have risen and exhibited the following characteristics: total transaction volume of 262 deals, a 3% decrease month-on-month; total order quotation amount reached $1.2 billion, a 29% increase month-on-month; average transaction amount of $5.2 million, a 34% increase month-on-month; buyers accounted for 41.98%, while sellers accounted for 58.02%.

Market activity has risen overall due to the increasing heat in the crypto market, with recent TGE projects like $NAM and the well-performing $OM, as well as the strong performance of $SOL over the past year, leading institutions to prefer short-term profits. Solana has been influenced by multiple factors, including but not limited to FTX unlocks and Galaxy Digital's proxy liquidation of staked token unlocks. The redemption of FTX accounts below $50,000 is expected to inject liquidity back into the altcoin market after being received in Q1, with the total unlock amount reportedly reaching as high as $10 billion, referred to by the market as a "quantitative easing" liquidity injection plan for cryptocurrencies ahead of the Federal Reserve.

Since Solana has been referred to as one of the next competitors likely to achieve ETF status after ETH joined the ETF in 2024, the Solana Foundation is actively supporting liquidity staking solutions like Solayer and RateX to reduce selling pressure. The Phantom wallet previously raised over $100 million, with the last round's valuation reaching $1.2 billion, making it highly favored by institutional buyers in the OTC market, potentially increasing the probability of token issuance in 2025. $JTO, as Solana's largest infrastructure and AI + meme coin trading wheel, is also favored by institutions in the OTC market.

$SUI and the SUI ecosystem, as the Move language modified from Facebook's Diem chain (a simplified version of Rust), saw its price break $4.4 by the end of 2024, a 125% increase compared to before Trump's election. $SUI's performance in OTC activities reflects institutional optimism about its development prospects, as its faster and cheaper transaction characteristics make it likely to become a third-generation public chain killer (previously, Solana was referred to as a second-generation public chain killer, and ETH as the first-generation public chain BTC killer).

AI leads traditional sectors, the three giants of physical assets rise, and innovative sectors compete for over 100% annual growth

Investment frequency growth rate in the primary market tags - change in trend

In 2024, looking at the investment frequency of cryptocurrency financing projects, the changes in investment preferences of investors and institutions mainly occurred in:

100 investments: The growth rate of artificial intelligence reached 128%, leading infrastructure/DeFi/gaming.

50 investments: DePin/RWA/LSD all achieved over 100% growth rates, while DEX/lending/payment/Layer 1/derivatives growth rates are also noteworthy.

<50 investments: AI agents/re-staking/MEME/cloud computing/launch platforms/IoT/stablecoin issuance/DA/gambling prediction games/DEX aggregation/privacy/Bitcoin ecosystem (BRC20/runic/Ordinals) all saw growth rates exceeding 100%.

Infrastructure AI dominated the first half, DePIN and RWA rose as highlights, stablecoins and privacy broke through in the second half, and traditional sectors showed significant differentiation

Monthly changes in investment frequency in the primary market tags - change in trend

In 2024, looking at the time distribution of investment frequency in cryptocurrency financing projects, the changes in investment preferences of investors and institutions mainly occurred in:

100 investments: DeFi/infrastructure/artificial intelligence steadily grew, while gaming showed a gradually declining trend.

50 investments: DePin/RWA/Layer 1 showed increasingly fierce growth trends, while NFT/DeFi-related financing numbers tended to decline after May due to market conditions.

<50 investments: Stablecoins/AI agents/privacy/MEME showed growth trends in H2 2024, while BTC-related/data/tool-related performances declined after H1 2024.

AI leads large investments, RWA and DePIN rise as new favorites, while NFT and Bitcoin ecosystems retreat

Share of investment frequency in the primary market tags - change in trend

In 2024, looking at the share of investment frequency in cryptocurrency financing projects over time, the changes in investment preferences of investors and institutions mainly occurred in:

100 investments: The growth proportion of the artificial intelligence sector is significant.

50 investments: RWA/LSD/Layer 1/DePin/payment/derivatives showed clear growth, while NFT/tools/DEX/design/CeFi saw a significant decline in share.

<50 investments: AI agents/stablecoin protocols/privacy/perpetual contracts/wallets/modular/re-staking/gaming solutions/ZK/CEX/gambling/Layer 3/yield aggregation/cross-chain bridges/API/DA/intention showed clear growth, while marketing solutions/Ordinals/Bitcoin ecosystem/creator economy/mining/asset management/NFT/BRC20/DID-related showed significant declines.

Stablecoins lead with 433% growth, AI and infrastructure sectors attract significant capital, while FHE, parallelization, RWA, LSD, and oracles flourish

Growth rate of financing amounts in the primary market tags - institutional capital trends

In 2024, looking at the financing amounts in cryptocurrency, the trends of investor and institutional capital mainly occurred in:

$1B tags: The issuance of stablecoins/developer platforms/Layer 1/DeFi/infrastructure all achieved over 100% year-on-year growth, with stablecoins and developer platforms growing at rates of 433% and 180%.

$0.25-1B tags: Modular/parallel EVM/DePin/RWA/LSD/mining all achieved over 130% increases, with artificial intelligence/mining/gaming each attracting over $800 million in funding, while DA/Bitcoin ecosystem/derivatives/L2/ZK growth rates maintaining at 100% should not be overlooked.

<$250M tags: FHE/AI agents/oracle machines achieved over 300% growth, while social/environmental/card/gambling/Layer 3/IoT/stablecoin protocols/perpetual contracts/launch platforms achieved over 150% growth.

Infrastructure sector shows steady growth, developer platforms break through in Q3, social gambling rises in Q2, security creation gains momentum in Q4

Monthly changes in financing amounts in the primary market tags - institutional capital trends

In 2024, looking at the time distribution of financing amounts in cryptocurrency, the trends of investor and institutional capital mainly occurred in:

$1B tags: Developer platforms and stablecoins saw significant growth in Q3, while infrastructure maintained steady growth throughout the year.

$0.25-1B tags: Modular/parallel EVM/DePin/RWA/payment/artificial intelligence showed stable growth throughout the year, with digital national cities experiencing significant growth in Q2.

<$250M tags: FHE/re-staking/privacy/card games/studios/MEV/cross-chain all saw significant growth at the beginning of the year, while Layer 3/social graphs/CeFi/gambling games experienced significant growth mid-year due to the elections and Farcaster, with security solutions/creator economy/custody/interoperability receiving more attention from institutions in Q3/Q4.

Developer platforms and stablecoins led strongly in Q3, while cloud computing and FHE rose, NFTs and the metaverse significantly retreated

Share of financing amounts in the primary market tags - institutional capital trends

In 2024, looking at the share of financing amounts in cryptocurrency over time, the changes in investment preferences of investors and institutions mainly occurred in:

$1B tags: Developer platforms/stablecoin issuers/Layer 1/DeFi saw a significant increase in share after Q3.

$0.25-1B tags: DA/data nations saw a significant increase in share after Q3, while modular/parallel EVM/DePin/RWA/LSD/mining/lending saw an increase in share throughout the year, while wallets/payment/CEX/gaming/social/ZK saw a decline in share.

<$250M tags: Cloud computing/FHE/AI agents/social graphs/Layer 3/oracles/prediction markets/environmental solutions/card games/gambling games/launch platforms/chain abstraction/NFT lending/CeFi/DID saw a significant increase in share starting from Q1, while re-staking/gaming solutions/privacy/DEX/staking services maintained a steady increase in share throughout the year, while NFT/metaverse/tools/custody/cross-chain/interoperability/music/CeFi asset management saw a significant decline in share.

Bitcoin ecosystem grew by 162%, reaching a new high, with Cosmos/Solana growing by 144/93% closely behind, while TON, SUI, and DOT saw 100% growth, with Ethereum maintaining a strong lead at $1.1 billion

Growth rate of financing amounts in the primary market ecosystems - ecosystem potential

In 2024, looking at the financing amounts in the primary market ecosystems, the ecosystems attracting investor and institutional capital mainly included:

$200M total financing: BTC/Cosmos/Solana saw growth rates close to 100%, with BTC growing by 162%, Cosmos by 144%, and Base by 67%, with total amounts surpassing BNB/OP/Polygon/AVAX, while Ethereum maintained steady growth with a total financing of $1.13 billion and a growth rate of 61%.

$30-200M total financing: Ton achieved the largest increase with a growth rate of 316% and $66 million, while SUI and DOT followed closely with growth rates of 175% ($37 million) and 158% ($50 million), respectively. Scroll secured the first place with a total financing amount of $112 million, while others receiving over $50 million in financing include Mantra/Linear/Zksync/Blast/Sonic.

After leading in Q1, the ETH ecosystem declined, while Solana and Base steadily attracted capital, with TON and SUI leading the new forces

Monthly changes in financing amounts in the primary market ecosystems - ecosystem potential

In 2024, looking at the financing amounts in the primary market ecosystems, the ecosystems attracting investor and institutional capital mainly included:

$200M total financing: BTC/ETH/Avalanche/Polygon/Optimism saw strong growth in Q1 but experienced significant declines throughout the year, while Solana/Base/Arbitrum/BNB/Cosmos maintained stable financing amounts throughout the year.

$30-200M total financing: TON/SUI/Babylon/Scroll/Berachain/Sonic.

BTC and Cosmos steadily expand, Solana and Base emerge, while TON and SUI lead the new forces, and the AVAX ecosystem gives way

Share of financing amounts in the primary market ecosystems - ecosystem potential

In 2024, looking at the financing amounts in the primary market ecosystems, the ecosystems attracting investor and institutional capital mainly included:

$200M total financing: BTC/Cosmos/Solana/Base showed significant growth throughout the year, while Avax/Polygon saw significant declines.

$30-200M total financing: TON/SUI/DOT/Starknet/Babylon/Aurora showed significant growth throughout the year, while the remaining share showed little change.

From speculation to value: ETH leads the standardization of DeFi, regulatory integration promotes industry upgrades, performance innovation leads the future, and deep integration with the real economy

In 2024, the investment landscape in the crypto market underwent a significant shift. Although the total financing in the fields of artificial intelligence, infrastructure, and DeFi reached $9.346 billion for the year (basically on par with $9.615 billion in 2023), the focus of investment shifted significantly. Financing for Bitcoin-related projects grew by 162% year-on-year, mainly benefiting from the renaissance of Bitcoin's BRC20/BTC scripts and the push from ETFs; the artificial intelligence sector performed outstandingly in Q4, with a surge in financing frequency, highlighting the trend of accelerated integration between AI and crypto technology; at the same time, RWA, Layer 1, and DePin emerged as new investment hotspots, while traditional NFT and GameFi sectors gradually cooled down. From the perspective of ecosystem development, Ethereum maintained its dominant position with a financing amount of $1.13 billion and a growth rate of 61%, while the Cosmos and Solana ecosystems achieved significant growth rates of 144% and nearly 100%, respectively. Emerging ecosystems performed even more brightly, with TON growing by 316% and SUI by 175%.

It is noteworthy that in 2024, traditional sectors (infrastructure, DeFi) remained robust, but the market focus is accelerating its shift. The Bitcoin ecosystem is undergoing structural changes; although Layer 2 scalability solutions have made technical progress, they still face challenges such as user adoption and liquidity decentralization, and the development of the BRC20 ecosystem has also encountered issues like network congestion and infrastructure support. However, traditional investors are gradually participating in BTC investments through ETF products. Meanwhile, the success of AI meme coins in 2024 has also attracted the attention of institutional investors, driving a significant capital shift towards supporting the development of AI infrastructure.

Looking ahead to 2025, with a large influx of capital, the AI sector is expected to transition from concept to implementation, focusing on developing decentralized training, reasoning, data governance, privacy protection, and AI autonomous trading infrastructure. Under the clarification of the regulatory framework in the U.S., particularly with policies promoting the simplification of token registration processes by the SEC and the repeal of SAB 121, the RWA market is expected to flourish, with explosive growth anticipated in the tokenization of U.S. Treasury bonds, institutional-grade bonds, and real estate. High-performance public chain sectors (such as Solana, SUI, and emerging Monad and Eclipse) will be validated in terms of trading performance, scalability, and complex application scenarios. DePin and IoT infrastructure will begin to scale, combining with the real economy and cash flow income, integrating decentralized computing, distributed storage, and other technologies to form product forms aimed at traditional consumers. At the same time, DeFi 2.0 will develop under a clear regulatory backdrop, with institutional-level DeFi liquidity provision becoming a new standard.

The market in 2025 will shift from chasing short-term hotspots to building long-term value, with project valuations increasingly based on actual adoption and cash flow performance rather than speculative expectations. This transition process will change the business and development logic of the entire industry, marking an important turning point towards the maturity of the crypto industry.

“RootData: 2024 Web3 Industry Investment Research Report” PDF version

“RootData: 2024 Web3 Industry Investment Research Report” PDF version

“RootData: 2024 Web3 Industry Investment Research Report” PDF version