Monthly venture deal count in crypto fell to roughly 50 deals in May, a level last seen in the pre-2021 era when the industry was a fraction of its current size.
The compression is visible across nearly every category in the chart, with Infrastructure and Crypto Financial Services, historically the two most active buckets, both tracking near multi-year lows.
The decline reflects a combination of factors. Investor attention has broadly shifted toward AI, pulling capital and mindshare away from crypto ventures at a structural level. Simultaneously, the crypto space has struggled to produce the volume of compelling early-stage opportunities that characterized the 2021 and 2024 cycles.
Deal count tells one part of the story while dollar volume tells another. Despite the slowdown in deal activity, funding totals have remained somewhat elevated. Prediction market platform Kalshi's $1 billion raise is a recent example of how capital concentration is playing out: fewer deals, but larger checks when a category-defining company emerges.
This dynamic points to a market that is consolidating rather than contracting uniformly. Generalist crypto VCs are becoming more selective, while the projects that do attract conviction are commanding outsized rounds.
For builders, the current environment carries an underappreciated upside. With deal counts at pre-cycle lows, the competitive noise that characterized prior boom periods is largely absent. Projects that can demonstrate clear utility and traction are operating with less crowding than at any point in recent years.
Whether deal activity rebounds in the second half of 2026 will depend in part on whether new verticals, beyond prediction markets and financial infrastructure, can generate the kind of investor conviction that drives a broader funding recovery.
This is an excerpt from The Block's Data & Insights newsletter. Dig into the numbers making up the industry's most thought-provoking trends.
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