Web3 startups secured a staggering $9.6 billion in venture capital during the second quarter of 2025, marking the second-highest quarter ever, according to a fresh report from Outlier Ventures. Despite a noticeable decline in deal volume, with only 306 transactions, this significant funding indicates a shift in investment strategies within the crypto sphere.
A New Era of Strategic Investment
Outlier Ventures’ latest findings reveal a maturing market landscape where investors are focusing their capital on fewer, but more promising, ventures. The drop in deal numbers, the lowest since mid-2023, contrasts sharply with the increased median deal size across all stages. This suggests a pivot from the frenetic, speculative investing of previous years to more strategic, high-conviction allocations. Investors are now hunting for projects with robust infrastructure and proven leadership, rather than spreading their resources thinly across numerous nascent startups.
Notably, Series A funding has made a striking resurgence. After a challenging bear market period, the median Series A round swelled to $17.6 million, with 27 deals contributing a substantial $420 million—the most significant since 2022. Seed funding also gained momentum, with the median round size climbing to $6.6 million, reflecting renewed investor confidence in early-stage ventures.
Token Sales: A Tale of Two Markets
The token fundraising landscape presents a polarized picture. Private token sales amassed $410 million across just 15 deals, marking their strongest performance since 2021. In stark contrast, public token sales plummeted by 83% to a mere $134 million, highlighting a dwindling appetite for retail-focused offerings. This dichotomy underscores a growing preference for private, institutional-grade investments over public market participation. This trend aligns with the broader market dynamics, as seen in our coverage of the upcoming $4.5B token unlock in September.
According to Outlier Ventures, the capital influx is gravitating towards sectors that underpin the Web3 ecosystem’s foundational layer. Cryptocurrency infrastructure, mining, validation, and compute networks emerged as the big winners, with median rounds ranging between $70 million and $112 million. Meanwhile, consumer-facing sectors like marketplaces lagged significantly behind, raising questions about their near-term viability.
Infrastructure Takes Center Stage
“Capital is consolidating around the projects that can provide the rails for the next phase of adoption,” notes Outlier Ventures. This trend towards infrastructure-first investments is seen as “indispensable” for Web3’s long-term growth. The firm’s analysis suggests that as the market matures, investors are becoming increasingly discerning, prioritizing projects that can lay the groundwork for future advancements and scaling. This strategic focus is further exemplified by recent partnerships, such as Chainlink’s collaboration with SBI Group to advance tokenized assets and stablecoins in Japan.
The report also sheds light on the evolving investor mindset, moving away from the hype-driven decision-making that characterized the early days of Web3. Instead, there is a noticeable shift towards durability-focused investments, with backers zeroing in on founders and teams that possess the technical expertise and operational know-how to execute their vision.
As Web3 continues to evolve, the current funding dynamics raise intriguing questions about the future trajectory of the space. Will this trend towards concentrated, infrastructure-focused investments persist? Or could we see a resurgence in broad-based, speculative funding as new technologies and applications emerge? As we navigate these uncharted waters, one thing remains clear: the Web3 landscape is undergoing a profound transformation, with significant implications for the future of decentralized technologies.
In the coming months, market watchers will be keenly observing how these investment patterns unfold and whether they signal a long-term shift or a temporary recalibration. As the crypto world stands on the brink of its next phase, the strategic bets placed today could very well shape the digital economy of tomorrow.
Source
This article is based on: Web3 Funding Hit $9.6B in Q2 Despite Fewer Deals
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
