Binance Wallet shines, but token sales, VC funding slow down in August

Crypto fundraising through token sales totally reversed the trend from July, with volumes diminishing for both VC funding rounds and IDO/ICO raises. Despite the price records, fundraising attracted caution, with both the number of deals and their monetary value falling in the past month.

August was a slow month for token sales and fundraising, with both the number of deals and their monetary value sliding. Based on Cryptorank data, IDO/ICO sales and VC-backed rounds took a downturn in August, reflecting a historically slow period for crypto. 

As attention shifted to DeFi and ETH, new token launches took a hit. July’s bottom line for token sales was also padded by the Pump.fun ICO. As Cryptopolitan reported, Pump.fun sold out its ICO in 12 minutes, completing the third-largest sale in the history of crypto. 

However, the success of one ICO did not revive ICO season. Projects are generally more skeptical of token launches, mostly due to competition from memes and general buyer skepticism. 

IDO, IEO and ICO token sales slow down since March

As a result, August saw only 63 token sale deals from various platforms, raising around $53M. Despite the overall recovery of blue-chip assets, the ICO and IDO market has been in decline since March, with the trend becoming even more visible.

August also marked a one-year low in terms of the number of deals, breaking down below the usual level of around 100 crypto deals per month. 

The IDO and ICO token activity has also switched venues from PancakeSwap to Binance Wallet. Tokens from Binance Wallet events have the highest returns, based on Cryptorank data. The success of token sales also depends on the presence of incentives and communities, as the crypto market remains over-saturated with new assets. 

The IDO market also slowed down as the altcoin season is still indecisive. While some of the BTC funds roll over into ETH and Solana and build their liquidity, there is still no trend of funds going back to new tokens due to the heightened risk. 

The Initial DEX Offering (IDO) takes up over 75% of token sales, with around 20% for Initial Exchange Offerings. Token sales have shifted to direct listings and liquidity, as DEX activity offered more opportunities. 

VC deals return to baseline in August

VC deals raised a total of $3.6B for the whole month of August, in a total of 113 events. Around $2.42B were raised in the USA, and around $975M in undisclosed locations. In August, Europe was almost a side note in terms of crypto deals, with only small inflows from the UK and Spain. 

Coinbase Ventures was among the most active funds, leading a total of eight rounds for the month. Pantera Capital came second, leading six deals. 

For the past year, the trend of smaller seed deals continues, while funds poured more into undisclosed rounds and late-stage financing. Deals sized at $3M- $10M still made up the most of the volumes for the past year. 

In general, VC activity remains slightly slower than normal. AI preserved its top spot as the leading narrative, though the latest rounds also shifted to payment systems and RWA projects.

The recent trends show a shift to infrastructure and real platforms, moving from the phase of vaporware token sales, NFTs, and gaming. Those sectors have disappeared from the VC radar, as Animoca Brands also slowed down its activity and shifted to new narratives.