Q1 2026 Crypto Startup Funding Near $5 Billion, Market Predicted to Be the Biggest Winner

CycleProphet · 2026-04-04T00:32:10+00:00

In the first quarter of 2026, crypto startups raised nearly $5 billion, a 16% decrease year-over-year. Investment focus shifted to payment and trading infrastructure, with market leaders predicted to emerge. Top institutions like Sequoia Capital are accelerating their market entry. The top ten funding projects include Kalshi, Polymarket, and Rain.

CycleProphet

2026-04-04 00:32:10

Abstract generation in progress

Deep Tide TechFlow message: on April 04, DL News, citing DefiLlama data, reported that in the first quarter of 2026, crypto startups collectively raised nearly $5 billion, down 16% year over year. However, the investment ecosystem continues to evolve, with capital flows clearly shifting away from speculative tokens toward practical tracks such as payment and trading infrastructure. Among them, the prediction market sector led with more than $1.7 billion. Payments and trading infrastructure attracted $735 million and $423 million, respectively. Top non-crypto institutions such as Sequoia Capital, the Founders Fund, Bain Capital, and Alibaba have also accelerated their entry.

The top 10 funding projects are as follows for Q1:

Kalshi: $1 billion; valuation $22 billion; Coatue Management led the round; a prediction market leader regulated by the CFTC
Polymarket: $600 million; Intercontinental Exchange (ICE) invested; a leading decentralized prediction market platform
Rain: $250 million Series C; valuation nearly $2 billion; Iconiq Capital led the round; stablecoin payment infrastructure
BitGo: $213 million; NYSE IPO; valuation over $2 billion; a crypto custody institution
Flying Tulip: $206 million; public token sale; led by DeFi architect Andre Cronje; integrating trading/lending/insurance
Whop: $200 million; Tether fully invested; valuation $1.6 billion; a stablecoin payments marketplace for digital creators
LMAX Group: $150 million; Ripple fully invested; planning to use the integrated RLUSD stablecoin as margin collateral
Alpaca: $150 million Series D; valuation over $1 billion; Drive Capital led the round; with participation from Citadel Securities and others
Bluesky: $100 million Series B; led by Bain Capital’s crypto division; a decentralized social platform with more than 43 million users
Anchorage Digital: $100 million; invested by Tether; valuation over $4 billion; the United States’ first licensed national trust crypto institution

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