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It’s a Great Time to Invest in Early-Stage Web3 Deals — Here’s Why.
Crypto’s emperor has no clothes moment has a silver lining.
Crypto markets are cooling down.
Soaring inflation, rising interest rates, the end of stimulus cheques, the post-COVID re-opening of economies, and the recent Terra/Luna bank-run and mass liquidation event are all taking their toll, amongst myriad other factors.
Across the broader private markets, the impact is already being felt by way of diminishing deal sizes and volumes.
In Q1 of 2022, global venture funding fell by 19% to US$144 billion from the previous quarter.
Private market valuations and activity tend to lag behind the public markets where the NASDAQ has shed about a third of its value since Jan 22 (below).
The next quarter or two at least are expected to be characterized by wide-ranging valuation markdowns, further downturns in deal size and volume, and at its core, belt-tightening by both funders and founders.
This will be especially true for later-stage ‘mega-rounds’, which were already down 30% in Q1.
