Venture capital mainstay spotlights cryptos lack of innovation

The crypto market has experienced dips and falls for a long while which can be attributed to the release of certain projects and assets. Venture capital funding played a huge role in a huge chunk of the crypto market’s growth but some people do not feel the market is growing beyond its boundaries. 

Tony Cheng is a general partner at Foresight Ventures with an ear to the crypto market and other Web3 investments. He is a known supporter of the blockchain and how it can help with innovation. With his experience in this field, he has given a verdict about the crypto space and how it lacks innovation, which in turn discourages funding for crypto projects.

Venture capital funding for crypto has decreased in 2023

Funding is important for anyone because it drives people to move forward. It can be true for your Gamdom gameplay and it can also be integral to how companies move forward with their plans. This is especially true with crypto-based companies as it’s challenging to establish one without the proper funding.

That is why most of those companies look towards venture capitalists to help them secure a proper path to working properly. This was evident in 2022 when crypto companies were popping off with investments from venture capitalists.

The first two quarters of 2022 dwarf 2023’s funding as the former had a combined $20.3 billion flow into crypto during Q1 and Q2. The latter only had a combined $4.7 billion worth of venture capital funding. 

Most people can tell that venture capital companies are not pleased with what they see in crypto. As a partner in a crypto investment firm like Foresight Ventures, Cheng’s opinion matters  as he has experience dealing with both sides of crypto and venture capital. 

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What does Cheng see as the primary problem?

According to Cheng, the old reliable narratives that the crypto market works with have gotten stale and old nowadays. People have grown to learn about layer-2 solutions and non-fungible tokens (NFTs) which were big hits before but now, they’re not as innovative as Ethereum earlier in crypto’s lifetime.

The Foresight Ventures executive talked about what he feels is the problem. He said, ‘I think right now the biggest problem and obstacle for a lot of these people is the lack of confidence, mainly because we haven’t really seen any new innovation in this space’.

Cheng also said that crypto companies should not rest on their laurels when they secure funding. They need to show that the money is going to the right place because the money might run out if they don’t do something with the cryptocurrency and projects that go along with it.

Crypto companies have always worked with the ‘growth at all cost’ approach which Cheng does not agree with. He hopes that more companies will focus on being more profitable and stable first then they can focus on growth. 

That is why plenty of online platforms are launching sites with Bitcoin casino games, Web3 projects, and more. Getting that off the ground and succeeding can lead to the space showing bull market indicators and more investors. As long as these platforms show there is potential for their projects, funding will come from the networks they build.

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