Original source: PitchBook, Robert Le
Compilation of the original text: Classmate Xiao Pang@0xthefool
Pitchbook aggregated nearly 10,000 financing records in the encryption industry and made industry mapping for the market.
Including 5 sections of blockchain network, user interaction, infrastructure, Web3 and decentralized finance, 22 tracks and 1203 leading companies.
I have sorted out all the key information to help you study the total investment amount, growth momentum, trends and opportunities of each sector and track in the encryption industry, and establish an encryption worldview.
Section 1 - Blockchain Network
Total $80 billion invested
The blockchain network stores and calculates data through distributed nodes to form a decentralized ledger to support the operation of transactions/smart contracts/DAPPs.
Growth drivers:
1) The scalability of the two pioneers , BTC and ETH, is far below industry needs
2) Multi-chain brings the demand for composability and interoperability
Track 1: Layer 1
In addition to the two chains of BTC and ETH , Layer 1 has a total of 63 leading projects such as APTOS and NEAR, with a total financing of 49 billion US dollars.
As the main network of the blockchain, L1 has a consensus mechanism and undertakes the information distribution, verification, processing, and storage functions of the blockchain network. It can also be further subdivided according to whether it is EVM and whether it is open source and open.
Track 2: Layer 2
Led by Polygon, a total of 38 leading L2 projects have raised a total of US$25 billion. The L2 protocol mainly improves the computing power of the Layer 1 network through different technologies such as side chains and Rollup . L2 uses L1 as a basis to take advantage of its security but also often changes the way data is processed and the consensus mechanism. Part of L2 can also be used as an independent blockchain network.
Track 3: Cross-chain
The 18 cross-chain tools represented by Polkadot and Layer Zero have raised a total of 680 million US dollars, and their main role in the ecology is to promote the exchange of information between different blockchain networks. Common technologies fall into three categories - Lock & mint is locked on the original network and then re-mint on the new chain, Burn & redeem and get the new one after burning, and the original swap of the native swap system.
Section 2 - User Interaction
A total investment of US$166 billion
Most users cannot directly use the data on the blockchain, but need user interaction platforms/tools to complete crypto transactions, management and research.
Growth drivers:
1) In the bull market, a large number of individual and institutional exchanges with investment purposes poured in
2) Virtual currencies are more used in countries with high inflation and corrupt governments, and black production also brings demand
Track 1: Asset and Tax Management
Users manage assets and taxes through 35 leading tools, including Taxbit and CoinTracker, which have raised a total of US$990 million. These tools help individuals with tasks such as investment portfolios, automated scheduled investments, retirement savings, and tax preparation.
Track 2: Wallet and Exchange
A total of 63 exchanges and wallets, such as Binance and Phantom, have raised a total of US$12.9 billion to help users better manage their cryptocurrencies. Non-custodial wallets include networked hot wallets, non-networked cold wallets, and hardware wallets. Hosted wallets include custodians and centralized exchanges. Savings and loans in some virtual currencies are also included in this category.
Track 3: Deposit and withdrawal and payment
63 products in the field of deposit and withdrawal and payment provided financing of 1.8 billion US dollars, helping more encrypted users complete the conversion between virtual currency and legal currency, and also helping users transfer and use assets on different chains. Compared with cross-chain bridges, the assets managed by products in this field are not on the chain, but interact with offline finance. MoonPay is a champion product in its field.
Track 4: Data and Research Tools
27 on-chain data and research tools represented by Nansen, Dune, and TokenInsight have received a total investment of 930 million US dollars to help individuals and institutions better obtain, interpret and analyze on-chain data, and further discover good encrypted products and assets And manage your portfolio well.
Section 3: Infrastructure and Development Tools
Infrastructure and development tool products have laid the foundation for further establishing a prosperous on-chain ecosystem, allowing more Builders and Developers to advance the industry. Companies in this sector raised a total of $13.8 billion.
Growth drivers:
1. Although encryption was initially more grassroots individual participation, more and more large institutions have also joined it
2. The number of builders doing Web3 development is gradually increasing
Track 1: Encrypted enterprise team/financial management tool
36 companies and financial management tools in the crypto space, represented by Utopia, which helps DAOs manage payroll, raised a total of $330 million. As more and more traditional institutions join the encryption and more institutions native to the encryption field are born, the demand for on-chain team management and financial management of various institutions and organizations has also increased.
Track 2: Data Storage and Recall
The 49 on-chain data storage and call companies represented by Chainlink have raised a total of 850 million US dollars, providing many developers with on-chain file and database management call and distribution. Including decentralized storage, block explorers, and oracle machines.
Track 3: Development Platform
A total of 57 development platform projects represented by Censensys, Alchemy, and Thirdweb have raised a total of 3.8 billion US dollars, providing programmers with software, APIs, and tools to help develop, test, deploy, and maintain products on the chain. Including development environment, node management, Web3 original sound development library, and on-chain interactive interface.
Track 4: Institutional Fund Management Tools
63 institutional fund management tools, including Gnosis Safe, Cobo, and BitGo, have raised a total of US$6.9 billion, helping more companies and businesses by providing tools and services such as token custody, staking, trading, brokers, liquidity aggregators, and doing things Institutions enter the encryption ecosystem.
Track Five: Security and Compliance
42 leading security and compliance tools such as Chainalysis and Beosin have raised a total of US$2 billion to help more institutions and organizations reduce security risks such as theft of encrypted assets and hacking attacks, while helping companies complete compliance requirements such as anti-money laundering.
Section 4: Decentralized Finance
Compared with traditional financial services that rely on banks, securities brokers, etc., decentralized finance establishes a decentralized, agent-free, person-to-person, and smart contract-driven protocol on the public chain represented by Ethereum. Users provide financial services. Any individual can freely use various financial services on the public chain and view the principles and processes of Lego.
Track 1: Asset Tokenization
Boson Protocol and other 28 products with a financing of 260 million US dollars help users to tokenize assets, which includes both on-chain assets (encrypted token portfolio, NFT, etc.) and off-chain assets (carbon emission indicators, carbon credit points, real estate assets, etc.).
Track 2: Decentralized Insurance
A total of 18 leading decentralized insurance products that have received an investment of 800 million provide insurance services for encrypted assets. The encrypted assets that can obtain insurance services include any tokens stored in exchanges, wallets, and liquidity pools.
Track 3: Decentralized Lending and Yield Generator
A total of 63 decentralized lending and liquidity mining products, represented by the extremely popular LIDO recently, raised a total of 990 million US dollars, allowing crypto users to rent, borrow, and make profits through yield farming on the chain. While there are some protocols exploring unsecured lending, most lending today requires over-collateralization.
Track 4: Decentralized trading platform and derivatives
Decentralized trading platforms and decentralized financial derivatives such as Curve and PancakeSwap have raised a total of 1 billion US dollars, helping users to conduct transactions and market-making tools that do not require permission and custody, and also promote the development of decentralized financial derivatives such as futures. universal.
The fifth block: Web3
The development of blockchain allows us to give the ownership of the network platform to every user. Compared with the web2 platform represented by Internet giants, the web3 platform will open source code, allow users to own their own data, and build and make decisions together with the community. As the outlet of the last bull market, a total of US$11.1 billion was raised.
Growth drivers:
1. Declining trust in the Web2 platform
2. Development of Creator Economy
Track 1: Content and Social
Social platforms in different application scenarios and content platforms with themes of text, pictures, videos, music, etc. are created and shared through decentralization and community co-creation, and social tokens and NFT technologies are used to better maintain content creators and consumers or relationship. The track has raised a total of $920 million in financing.
Track Two: DAO and DAO Tools
Decentralized autonomous organizations issue ownership of the organization to members through Token and NFT, and by holding tokens, members can manage, vote in DAO, and obtain rights and interests in other DAOs
DAO and DAO tools projects like Syndicate, which helps build investment DAOs, and web3 builder social DAO Friends With Benefits, have raised a combined $220 million in funding.
Track 3: Commercial and Consumer Platforms
Brave helps people trade attention, BrainTrust helps users trade talent (recruitment). Many decentralized trading platforms in web3 maintain the relationship between the platform and users through the joint construction and governance of the decentralized community, and at the same time better bind all participants to the platform through tokens. A total of US$1 billion has been invested in the track.
Track 4: Hardware Empowerment
Helium establishes a wireless communication network by rewarding the communication terminals of community members, and HiveMapper establishes a decentralized map data system by rewarding members' vehicle recorders. The hardware empowerment track has raised a total of 620 million US dollars. Through tokens, users are encouraged to purchase and maintain off-chain hardware to build communications, maps and other networks.
Track Five: Metaverse and Games
Decentralized Metaverse and blockchain games are also capital favorites in the last bull market. Products such as Axie Infinity, known as Play to Earn, and Decentraland, an open world on the chain, have raised a total of 4.1 billion US dollars through the development of content, infrastructure and tools. Build a virtual world.
Track 6: NFT and Collectibles Platform
As an application scenario that detonated the last bull market, the NFT track has received a total of 4.2 billion US dollars in investment, which includes not only the NFT project BAYC, but also high-quality projects such as the NFT tool POAP and the NFT trading platform OpenSea.
Summarize:
Blockchain network: Layer 1, Layer 2, cross-chain
User interaction: asset tax management, wallet/exchange, deposit/withdrawal/payment, data analysis
Infrastructure: encryption organization management, data storage, development platform, fund management, security and compliance
Decentralized Finance: Asset Tokenization, Decentralized Insurance, Decentralized Lending, Trading Platform
Web3: social content, DAO tool, market platform, hardware empowerment, Metaverse, NFT
Because the content of PitchBook cannot be directly shared externally, the original link is not attached. The first author is the analyst Robert Le, and the content includes the translation and some adjustments of Xiao Pang.
In fact, there are more good cases that can be added to various industries. If there are more interested friends, I can make an in-depth analysis of various industries and top projects in the next issue.
