Virtual Asset VC Investments Lean Toward Treasuries, Startups Left Behind

This year, as Digital Asset Treasury (DAT, a strategy for stockpiling virtual assets) gains considerable attention, it has attracted institutional investors, whereas existing virtual asset (cryptocurrency) startups have found it difficult to attract investments.

On the 11th (KST), The Block, a media outlet specializing in virtual assets, analyzed VC investments in virtual asset companies from January to August this year and reported that the number of VC investments excluding DAT amounted to only 856 cases. This figure marks a sharp 56% decline compared to the same period last year (1,933 cases).

During the same period, the amount of investment funds raised by virtual asset startups reached $8.05 billion, showing a slight decrease year-over-year. However, $2 billion of that came from a token sale investment raised by Binance, so if this is excluded, pure investment fundraising dropped by about 25% compared to the previous year.

Experts analyze that DAT is appealing because it offers instant evaluation and liquidity, and if a market premium forms, it enables further fundraising and asset acquisition. Ed Roman, co-founder of Hack VC, said, "For now, liquidity funds are the most active category," adding, "Some VCs are investing in DAT to preserve idle capital until suitable venture deals arise."

Some VCs are temporarily allocating their funds to DAT until they find promising investment opportunities, which is leading to a decrease in the share of traditional early-stage startup investments.