Early-stage investment in Bitcoin-native startups saw a significant surge in 2024, underscoring the rapid expansion of a once-niche sector, according to a recent report by Trammell Venture Partners (TVP).
Despite a 22.1% drop in total capital raised across the broader market, the number of Bitcoin startup deals grew by nearly 32%, with pre-seed investments alone increasing by 50%.
TVP defines “Bitcoin-native” companies as those built around Bitcoin’s monetary principles and protocol stack, developing products that leverage its growth and utility. Unlike broader crypto ventures that span multiple blockchain networks, these startups focus entirely on Bitcoin, embedding themselves deeply within its ecosystem to drive its adoption and development.
The report highlights that in 2024, the volume of Bitcoin-native pre-seed deals was more than seven times higher than in 2021, signalling a sharp rise in new startups and innovation within the sector. This momentum was reflected in seed and Series A funding rounds, which saw deal volumes rise by 30% and 60%, respectively, year-over-year.
Although the overall capital raised declined, the continued increase in deal count and new company formation indicates growing confidence in Bitcoin-native startups. TVP emphasizes that four consecutive years of growth signal that these companies could soon capture a more significant portion of crypto venture funding.
Further bolstering this momentum is the growing institutional support for Bitcoin-native startups. The report noted that in 2024, firms like Founders Fund, Ribbit Capital, Y Combinator, and Valor Equity Partners participated in funding rounds, signalling rising confidence in business models built around Bitcoin’s protocol layers.
Despite Bitcoin representing over half of the crypto market’s total value, it accounted for just 2.3% of venture funding last year. TVP views this imbalance as an opportunity for Bitcoin’s ecosystem to expand beyond its traditional mining and asset-holding roles, opening doors for further growth and investment.
A related report by Lattice Fund found that more than 80% of crypto startups funded in 2022 remain operational despite market downturns. Of the 1,200 startups that raised $5 billion, 76% launched a mainnet product, while 18.5% have ceased operations. Among the success stories, Ethereum re-staking protocol Eigenlayer stood out, though only 1.5% of startups reached Product Market Fit, and 12% secured additional funding.
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