EU-Based Crypto Startups Receive a Boost in VC Funding Due to MiCA’s Impact
The European crypto market has seen an increase in venture capital (VC) funding over the past few months, following the introduction of the Markets in Crypto Assets (MiCA) regulatory framework earlier this year, which is set to become law in July. MiCA aims to regulate crypto assets and those engaged in transactions, making it the first major step towards regulating the industry. VC investment into European crypto projects has risen almost 10x in the past year, from a share of 5.9% in Q1 2022 to 47.6% in Q2 2023. London-based crypto startups have seen particular success in securing VC funding, while Zurich and Berlin are other strong hubs. VC funding for crypto startups in Europe totaled $5.7bn last year, according to a study from Romanian investment firm Rockaway. While the new clarity from regulation has helped Europe, VC funding for startups has taken an 82% tumble in the first quarter of 2023. Several executives in the crypto space have praised regulation for bringing clarity to the market, while allowing for more investment and involvement from entrepreneurs around the world.