“Who has been using it?” is the crucial question, says To
“We’re at a phase where you don’t have that luxury to just bet on these new narratives,” she said, adding that investments now require a much more critical lens.
“You really have to start thinking, there’s all this infrastructure being built in the industry, but who has been using it? Are there enough transactions? Is there enough volume coming through these chains to justify all the money being raised?”
To said that in 2025, many projects have been raising funds at inflated and often unjustified valuations, relying heavily on future cash flow projections.
“The potential revenue and the pipeline they’ve got aren’t solidified,” To said, adding that it has been “a slow year.”
Crypto startup funding declined in Q2 2025
Eva Oberholzer, the chief investment officer at VC firm Ajna Capital, recently echoed a similar sentiment to To.
“It's more about predictable revenue models, institutional dependency, and irreversible adoption,” Oberholzer told Cointelegraph on Sept. 1.
Oberholzer said that VC firms have become much more selective with the crypto projects they invest in, representing a shift from the previous cycle due to market maturation.
Galaxy Research’s latest VC report showed that crypto and blockchain startups raised a total of $1.97 billion across 378 deals in the second quarter of 2025, which represents a 59 % decline in funding and a 15 % drop in deal count compared to the previous quarter.
Overall, total venture capital investment into crypto amounted to $10.03 billion over the three months ending June.
Leading the pack, Strive Funds, an asset manager founded by American entrepreneur and politician Vivek Ramaswamy, secured $750 million in May to establish “alpha‑generating” strategies through Bitcoin‑related purchases.