Bitcoin, venture capital and security tokens flash green: Report
The blockchain industry does not exist in a bubble. The impact of the rest of the world’s economic turmoil seems to be trampling all over the progress of the “blockchain revolution.” Traditional markets such as the S&P 500 crashed more than 11.5% in September, while the tech-heavy Nasdaq 100 fell 12.5%. However, Bitcoin (BTC) may have seen a disconnect, having only fallen 3% over the same period.
For some, this is the sign of a bottom for Bitcoin, but it does not necessarily mean that an immediate reversal is in the market. Are there other positive flashing signals we can see in the charts?
Each month, Cointelegraph Research releases an Investor Insights report that analyzes key indicators from various sectors of the blockchain industry. Metrics from 10 segments of the blockchain space – including regulation, cryptomining, security tokens, Bitcoin and Ether (ETH) derivatives, and venture capital (VC) activities – are analyzed by those working closely on the subject.
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Bitcoin and more
Venture capital is often a lagging indicator of market sentiment in traditional markets. In 2021, the blockchain space saw continuous increases in capital inflows per quarter. In 2022, Q1 continued this trend, while Q2 began to show a decline in VC capital entering the space. September saw a 20.6% increase in capital investments by VCs across 93 deals throughout the month.
Web3 had the largest number of individual deals at 31 and brought in $378.8 million, while Infrastructure had 29 deals and saw the bulk of the investment at $913.6 million. This could be another indicator that the bottom of this bear market cycle is in.
The volume of the security token is growing
In September, the market capitalization of security tokens grew by 6.27% — $18.7 billion compared to $17.6 billion in August. Volume also exploded by 19.76% over the previous month. The action in the security token markets is not the only positive one, as news that the Hong Kong government is encouraging security token proposals to be submitted to the Securities and Futures Commission (SFC) bodes well for the sector.
While this may be an often neglected area of interest by the average blockchain investor, security tokens help demonstrate mainstream adoption in various applications for the blockchain industry and can be a good indication of how all crypto markets will play out in the near future.
The Cointelegraph Research team
Cointelegraph’s research department consists of some of the best talent in the blockchain industry. Bringing together academic rigor and filtered through practical and hard-won experience, the researchers on the team are committed to bringing the most accurate and insightful content available on the market.
Demelza Hays, Ph.D., is the Director of Research at Cointelegraph. Hays has assembled a team of subject matter experts from all areas of finance, economics and technology to bring to market the premier source of industry reports and insightful analysis. The team uses APIs from a variety of sources to provide accurate, useful information and analysis.
With decades of combined experience in traditional finance, business, engineering, technology and research, the Cointelegraph Research team is perfectly positioned to put their combined talents to good use with the Investor Insights report.
Disclaimer: The opinions expressed in the article are for general information purposes only and are not intended to provide specific advice or recommendations for any individual or about any specific security or investment product.