December crypto VC roundup: Gaming and DeFi kept trending, but NYDIG's $1 billion stole the show

This article is part of a monthly series from The Block that takes a closer look at where the most recent venture capital investments have been flowing.

Last year was a historic one for crypto funding. Venture capital investors throwing around $28 billion into the emerging industry in 2021 — twice what had been invested in crypto startups over the previous six years combined.

It was the second half of the year that saw the most blistering pace of new investment. Crypto startups raised an average of nearly $3 billion each month from July to December.

Deal sizes also significantly grew in 2021, with over 50 mega-rounds richer than $100 million. December saw four such mega funding rounds, including a $1 billion raise by NYDIG. Anchorage, 1inch and Figment’s December mega-deals were worth $350 million, $175 million and $110 million, respectively.

Overall, the NFT and blockchain gaming category remained the most popular among investors for a third consecutive month, followed by DeFi. Below is the December roundup — organized by category — of all the VC fundraises worth more than $10 million announced during the month.

NFTs, and gaming and the metaverse

There were 10 fundraises over $10 million for firms explicitly focused on NFTs or blockchain gaming.

• Metaverse infrastructure startup Render Network raised $30 million in a token round led by Multicoin Capital. Other investors in the round included Alameda Research, the Solana Foundation, Sfermion, and angel investors Vinny Lingham and Bill Lee. Render Network provides a platform to carry out rendering jobs (computation-heavy digital media tasks) in a decentralized manner.
  
  
• NFT studio Palm raised $27 million in a funding round led by Microsoft's VC arm M12 Venture Fund. Griffin Gaming Partners, Sfermion and Warner Brothers also participated in the round. Palm, which was co-founded by ConsenSys founder Joseph Lubin, lets artists drop their NFTs on an Ethereum sidechain called Palm Network for lower gas fees.
  
  
• Metaverse platform Spatial raised $25 million in a Series B funding round. Several investors backed the round, including Maven Growth Partners, Pine Venture Partners, South Korea's KB Investment, Korea Investment Partners and Mirae Asset. Spatial started as an augmented reality and virtual reality platform but has pivoted to the metaverse amid the recent NFT boom. The startup creates online galleries where people can view and buy NFT art.
  
  
• Vietnam-based blockchain gaming studio Whydah raised $25 million from several investors, including HashKey, Eternity Ventures, Bitscale, Youbi and Morningstar Ventures. Whydah lets game developers apply blockchain technology to their games.
  
  
• Blockchain gaming startup SIDUS HEROES raised $20 million in a token funding round. Participants in the round included Animoca Brands, Polygon, OKEx Blockdream Ventures, AU21 Capital and HashKey. SIDUS HEROES is a play-to-earn NFT game that provides users with multiple gaming scenarios, including interstellar exploration, battles and settlements.
  
  
• NFT lending platform Arcade raised $15 million in a Series A funding round. Pantera Capital led the round, with Castle Island Ventures, Franklin Templeton Blockchain Fund, Golden Tree Asset Management, Probably Nothing Capital and Lemniscap participating.
  
  
• Yield Guild Games Southeast Asia, a "subDAO" of Yield Guild Games, raised $15 million in two rounds to promote play-to-earn gaming in Southeast Asia.
  
  
• Ready Player Me, a startup that lets users create a single avatar for use across virtual platforms, raised $13 million in a Series A funding round. Wise and Teleport co-founders Taavet+Sten led the round, with GitHub co-founder Tom Preston-Werner and Samsung Next participating.
  
  
• Play-to-earn gaming guild AAG Ventures raised $12.5 million in a funding round backed by Shima Capital, Tribe Capital, Tess Ventures, HashKey, Republic Realm and Sancor Capital. AAG Ventures supports several popular games, including Axie Infinity and The Sandbox.
  
  
• HEIR, a Solana-based NFT and fan engagement platform, raised $10 million in seed funding. HEIR is co-founded by NBA champion Michael Jordan and his son Jeffrey Jordan.

Exchanges, brokers, custodians, and lenders

December saw six raises larger than $10 million by firms specifically focused on crypto trading, custody, and lending.

• The headliner was NYDIG, a Stone Ridge Asset Management subsidiary that provides crypto services to institutions. NYDIG raised a massive $1 billion and is now valued at over $7 billion. WestCap led the round, with participation from Bessemer Venture Partners, FinTech Collective, MassMutual, Morgan Stanley and New York Life.
  
  
• Crypto custodian and bank Anchorage raised $350 million in Series D funding led by private equity giant KKR. The firm is now valued at over $3 billion.
  
  
• Crypto lending firm Ledn raised $70 million in a Series B funding round at a post-money valuation of $540 million. Dan Tapiero's 10T Holdings led the round. Coinbase Ventures, Alan Howard, Susquehanna Private Equity Investments also participated in the round.
  
  
• Crypto robo-advisor Stacked raised $35 million in a Series A funding round. Alameda Research and Mirana Ventures co-led the round, with Fidelity International Strategic Ventures, DRW Venture Capital, Alumni Ventures and Jump Capital also participating.
  
  
• Crypto derivatives trading platform (not the VC firm) Paradigm raised $35 million in a funding round led by Jump Capital and Alameda Research. Other investors included GSR, Genesis Trading, QCP Capital and Fidelity Digital Assets.
  
  
• Canadian crypto investing platform Shakepay raised $20 million in a new funding round, according to an SEC filing.

Don't forget DeFi

There were ten raises that surpassed $10 million for DeFi projects in December. Venture investment in DeFi also grew for the fourth consecutive month after hitting a low in August.

• Decentralized exchange aggregator 1inch Network closed a $175 million Series B funding token round. Amber Group led the round, with Jane Street, VanEck, Alameda Research, Celsius, Nexo and Gemini Frontier Fund participating.
  
  
• Decentralized talent network Braintrust raised $100 million in a private token sale led by Coatue, Tiger Global and True Ventures. Previous Braintrust backers including Blockchain Ventures and HashKey also participated.
  
  
• Multichain (previously Anyswap), a cross-chain token swap protocol, raised $60 million at a $1.2 billion valuation. Binance Labs led the round, with Sequoia China, Three Arrows Capital, Circle Ventures and the Tron Foundation participating.
  
  
• DeFi wallet DeBank raised $25 million in an equity funding round. The round was led by Sequoia China and saw participation from Dragonfly Capital, Coinbase Ventures, Circle and Ledger.
  
  
• DeFi trading platform Structure raised $20 million in a seed funding token round led by Polychain Capital.
  
  
• Ethereum Layer 2 privacy startup Aztec Network raised $17 million in a Series A funding round led by Paradigm. Capital Ventures, Ethereal Ventures, Libertus Capital and Variant Fund also participated.
  
  
• DeFi trading platform Slingshot Finance raised $15 million in a Series A funding round. Ribbit Capital led the round, with K5 Global, Shrug Capital and The Chainsmokers also participating.
  
  
• DeFi platform Earnity raised $15 million in a Series A round led by bitcoin mining company BitNile. Other participants in the round included Australia-listed investment company Thorney and blockchain fund NGC Ventures.
  
  
• XY Finance, a cross-chain token swap aggregator, raised $12 million in a funding round backed by Circle, Mechanism Capital, TRON Foundation, Yield Guild Games Ventures and Animoca Brands.
  
  
• Gear Technologies, a smart-contract platform for the Polkadot network, raised $12 million in a funding round led by Blockchange, with participation from Three Arrows Capital, Lemniscap, Distributed Global and several other investors.

Tools of the trade

The remaining 11 fundraises from December above $10 million don't fit neatly into a category. That said, they tend to involve firms developing various sorts of tools — tools for traders, crypto companies, and blockchain developers.

• A new bitcoin mining company called GEM Mining announced that it raised $200 million in "institutional capital." It did not disclose its investors.
  
  
• Crypto staking infrastructure provider Figment raised $110 million in a Series C funding round and is now valued at $1.4 billion. Private equity giant Thoma Bravo led the round, with Morgan Stanley's Counterpoint Global, ParaFi Capital, Binance and Bitstamp also participating.
  
  
• Blockchain auditing firm CertiK raised $80 million in a Series B2 funding round and is now valued at nearly $1 billion. Sequoia Capital led the round, with existing investors including Tiger Global and Coatue Management also participating.
  
  
• Crypto analytics startup Nansen raised $75 million in a Series B funding round led by Accel. A16z, Tiger Global and GIC participated. The firm is now valued at $750 million.
  
  
• Blockchain analytics firm TRM raised $60 million in a Series B funding round. Tiger Global led the round, with American Express' Amex Ventures, Visa, Citi Ventures, Block (formerly Square) and PayPal Ventures also participating.
  
  
• Lambda256, a blockchain-as-a-service provider run by Dunamu, the operator of South Korean crypto exchange Upbit, raised $60 million in Series B funding. Investors in the round included Dunamu, Shinhan Venture Capital, KB Investments and SBI Investments.
  
  
• Blockchain-based B2B payments platform TassatPay raised over $40 million in a funding round, according to an SEC filing.
  
  
• Mysten Labs, a web3 infrastructure startup founded by four former Novi engineers, raised $36 million in a funding round led by a16z.
  
  
• Crypto payments infrastructure startup Ramp raised $22.7 million in a Series A extension round. Investors included Balderton Capital, Galaxy Digital, and Wise co-founder Taavet Hinrikus.
  
  
• Blockchain-based cloud storage system provider CyberHash raised $20 million in a Series A funding round led by Lemon Capital.
  
  
• Passbase, an identity verification infrastructure company, raised $10 million in a funding round led by Costanoa Ventures. Other investors included Lakestar, Eniac Ventures, and Cowboy Ventures.

New crypto VC funds

Venture capital firms have to raise funds, too. Some significant rounds in December came from Initialized Capital and ParaFi. Overall, the month saw nearly 20 new fund launches by both existing and new VC firms.

• Initialized Capital, one of the earliest investors in Coinbase, raised $700 million for two new funds. The first fund is worth $530 million, and the second fund is worth $170 million.
  
  
• Dan Tapiero's 10T Holdings is raising $500 million for its third crypto fund. The fund will invest in mature businesses that are making significant revenue already.
  
  
• ParaFi Capital, founded by KKR alum Ben Forman, raised nearly $230 million for two new funds in December — nearly $30 million for one fund called the Private Opportunities Series I fund and an additional $200 million for its Digital Opportunities Fund.
  
  
• South Korean crypto VC Hashed launched a new $200 million fund to invest in Web3 startups, including those focused on metaverse, blockchain gaming, NFTs and DeFi.
  
  
• Polygon and Seven Seven Six, Reddit co-founder Alexis Ohanian's venture capital firm, jointly launched a $200 million initiative to invest in Web3 social media and gaming projects.
  
  
• Binance Smart Chain and Animoca Brands launched a $200 million blockchain gaming fund.
  
  
• Tencent-backed French game developer Voodoo launched a $200 million fund to invest in studios that focus on blockchain game development.
  
  
• Solana Ventures, VC firm Griffin Gaming Partners, and blockchain gaming firm Forte launched a new $150 million fund to invest in blockchain gaming startups.
  
  
• Venture accelerator Brinc raised $130 million in new funding, led by Animoca Brands, to invest in web3 startups across art, collectibles, gaming, DeFiand data.
  
  
• Amsterdam-based crypto VC firm Maven 11 Capital raised $120 million for its second fund. The firm plans to continue investing in DeFi and NFT startups.
  
  
• C2 Ventures, founded by the former head of blockchain investments at Huobi Global Ciara Sun, launched a $100 million fund with blockchain-gaming platform Gala Games. The fund will invest in game developers and decentralized gaming projects.
  
  
• Kraken Ventures closed its first fund worth $65 million. The firm looks to invest in crypto and fintech startups focused on areas including infrastructure, web3, and DeFi.
  
  
• Hong Kong-based VC firm Chiron Partners launched a $50 million fund to invest in Terra-based projects. The Chiron Terra Fund I will invest in DeFi, NFT, and other projects built on the Terra blockchain.
  
  
• Crypto derivatives exchange BitWell launched a $50 million fund to invest in metaverse projects, including those focused on gaming and NFTs.
  
  
• Chapter One closed a $40 million early-stage fund to focus on web3 investments. A16z's Marc Andreessen and Chris Dixon are investors in the fund.
  
  
• A new crypto venture capital firm called Lattice Capital debuted with $20 million in funding to invest in Web3 projects that are at their earliest stages.
  
  
• Asia-based SevenX Ventures raised $30 million for its second fund. The fund will invest in DeFi, NFT, and web3 startups. It will also focus on projects in the Polkadot, NEAR and Arweave ecosystems.
  
  
• Evan Fisher left Insight Partners to launch his own crypto fund called Portal Ventures. The fund has soft commitments of $30 million.
  
  
• Katie Haun left a16z to launch her own venture capital fund focused on crypto and blockchain. A16z will be a limited partner in Haun's new fund. Marc Andreessen and Ben Horowitz, the firm's founders, and Dixon will all personally contribute to the fund.