Cryptocurrency investment deals fell to their lowest point of 2025, as analysts cited a mix of market-specific and macroeconomic factors behind weakening venture capital (VC) activity.
Only 62 rounds were completed in May, a monthly low last seen in January 2021, according to data from crypto analytics platform RootData.
Despite the drop, the 62 investment rounds still raised more than $909 million, making it the second-best month of the year by value, trailing only Marchโs $2.89 billion across 78 rounds
The slowdown is likely a โcombination of market prices and sentiment,โ as both โpeaked at the end of January and rebounded only in April, before ranging from May 23 on deterioration of tariff rhetoric,โ said Aurelie Barthere, principal research analyst at crypto intelligence platform Nansen.
A challenging โmacro backdropโ paired with โhigher-for-longer policy rates, jittery bond markets and fresh tariff headlines have made it harder for risk assets to get new M&A deals over the finish line,โ according to Patrick Heusser, head of lending at Sentora and a former investment banker:
โMost of the transactions we are seeing are consolidation plays, a pattern that typically emerges in cooling markets or after extended periods of range-bound pricing.โ
The disappointing year-to-date performance of most crypto assets added to the lack of interest, with Bitcoin (BTC) โstanding out as a rare bright spot,โ he added.
Related: James Wynnโs second $100M Bitcoin bet: โThey are hunting meโ
M&A activity remains strong
Despite the drop in venture deals, merger and acquisition activity remained robust. Coinbase Global acquired Deribit for $2.9 billion in a traditional merger and acquisition (M&A), the exchange announced on May 8.
โI also see many large deals going through the traditional liquid channels,โ said Nansenโs Barthere, adding that more crypto regulatory clarity will benefit โdirect deals between large companies and protocols, away from the VC market.โ
The $2.9 billion marks a new all-time high for crypto M&As, according to RootData sourced by Blockworks.
Related: Metaplanet becomes 8th largest Bitcoin holder with $118M buy
The slowdown in VC deals may also be a function of โseasonal patterns,โ for May and June, according to Marcin Kazmierczak, co-founder and chief operations officer at blockchain oracle firm RedStone.
โMacro conditions certainly play a role, but Iโd expect activity to pick up again as we head into early Q4; thatโs historically when the best deals get done and investors return from summer mode,โ he told Cointelegraph.
Magazine: Bitcoin $200K โobviousโ breakout, GameStopโs first BTC buy: Hodlerโs Digest, May 25 โ 31
