The crypto winter hit hardly the markets and now the prices in the sector are recovering after metabolising the FTX scandal. But the climatic arrival of spring seems to be matched by price growth with Bitcoin rising by 20% in March, suggesting that the worst is behind us. But the previous year’s negative results have resulted in a slowdown in venture capital investment in the sector, although analysing data from a report by RockawayX, a venture capital firm focused on blockchain, and DealRoom, a startup data provider, shows that record levels of investment were reached in Europe in the year that Bitcoin lost 62%. European startups raised a record $5.7 billion in Venture Capital funding, surpassing the $5 billion in 2021. Among the reasons for this strong European performance was probably an increasingly hostile US regulatory environment, which could move the focus elsewhere.

Investments have mainly focused on infrastructure, including developer tooling, blockchain scalability products and layer 1 blockchains.

The start of 2023, however, shows a major contraction with cryptocurrency investments in January down 91% year-on-year. But it was only November when FTX closed its doors.