Approximately half of all venture capital investments during Q4 2024 were allocated to U.S.-based cryptocurrency startups. A future pro-cryptocurrency government might boost this trend even more.
According to a report by Galaxy Digital’s research division, filed on January 15th, it was discovered that nearly half (46%) of the invested capital went to companies based in the United States. This is significantly more than any other location, with Hong Kong coming in second place, receiving only 16% of the investments.
As a researcher examining global venture capital deals, I found that American companies accounted for a significant portion, making up approximately 36% of all such transactions. Not far behind were Singaporean companies, which represented 9%, and British companies, accounting for 8% of the total deal count.
In simple terms, Ryan McMillin, a co-founder and the Chief Investment Officer at Merkle Tree Capital (an Australian crypto investment firm), stated that the United States’ financial market and innovation sector is dominating globally, even under a challenging government, primarily driving this trend.
A larger number of venture capitalists and investors, often referred to as limited partners, are based in the United States. Notably, there was a substantial increase, approximately 46%, from one quarter to the next during Q4. This suggests that a considerable amount of this capital was invested with confidence in the anticipation of a Trump administration taking office.
Trump’s inauguration is scheduled for January 20th, with expectations that he may fulfill his pro-cryptocurrency pledges, which were made during his election campaign in the U.S.
Many politicians supportive of cryptocurrency have been elected to Congress, leading some experts to speculate that the U.S. administration could emerge as one of the world’s most crypto-friendly governments.
McMillin anticipates a significant increase in cryptocurrency venture capital investments this year, driven by the possibility of a pro-cryptocurrency government.
He stated that the shift from an unfriendly administration known for implementing chokepoint 2.0, using regulators as weapons against crypto startups, and de-banking them is being taken over by a team supportive of cryptocurrency and experienced in venture capital. This change will be as dramatic as night turning into day, and the market hasn’t fully factored this development into its pricing yet.
According to the Q4 report, Alex Thorn, head of research at Galaxy, along with research analyst Gabe Parker, noted that U.S. companies managed to maintain their dominance even amidst a challenging and frequently unfriendly regulatory environment.
Experts predict that the upcoming White House and Congress will have a strong supportive stance towards cryptocurrencies, which could lead to an expansion of America’s influence in this field.
As a crypto investor, I eagerly anticipate the finalization of anticipated regulations like the establishment of stablecoin frameworks and market structure laws. Once these measures are in place, it will pave the way for established U.S. financial institutions to enter the crypto space with confidence.
Over the past year, cryptocurrency companies have found themselves on the receiving end of numerous lawsuits initiated by the Securities and Exchange Commission (SEC). The SEC’s annual report published on November 22 reveals that they secured a total of $8.2 billion in financial relief during this period ending September 30.
However, the number of cases declined 26% from the previous year to 583.
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2025-01-17 09:19