The number of institutional investors in venture rounds of crypto companies rose 16% in October to 155 participants. Growing fund interest expands startups' opportunities to raise capital, but the market structure remains highly concentrated: almost the entire volume came from a few of the largest deals, and the overall level of investment is still far from last year's figures.
Prediction markets platform Kalshi drove a sharp jump in venture activity, closing a $1 billion round. The rest of the industry's companies, according to analysts' estimates, raised roughly the same as a month earlier — a broad inflow of capital into the sector is not yet observed.
Institutional investors have grown for a second month in a row
In October, 155 institutional investors participated in the industry's venture deals versus 134 in September. The figure has grown for a second month in a row after an August low of 125. Each investor was counted once regardless of the number of deals backed.
The recovery is coming from a low base: the current level is 56% below October 2025, when 353 investors participated in deals. The calculation includes only organizations from venture rounds — excluding business angels, decentralized autonomous organizations (DAOs) and guilds, which reflects the breadth of participation but not the volume of each investor's contributions.
The number of deals barely changed over the month: 46 venture rounds versus 44 in September. At the same time, seed and pre-seed stage rounds (Seed and Pre-Seed) increased — a modest improvement against the backdrop of late-stage deals that determined the month's results.
Without the two largest deals, investment did not grow
Venture investment in the industry reached $1.66 billion in October but remained 40% below October 2025, when companies raised $2.77 billion across 116 rounds. Kalshi received 61% of the October total, the four largest rounds — 81%, ten — 91%. The remaining 25 deals with disclosed amounts accounted for only $143 million.
Excluding the two largest deals of each month, investment volume was $451 million in October versus $455 million in September. The typical deal also became more modest: the median round size fell from $10 million to $7.2 million. The average size more than doubled — to $47 million — due to Kalshi's round.
Prediction markets led by volume, payment services by number of deals: 12 rounds worth $342 million, slightly more than half of venture capital excluding Kalshi. However, investment in the payments sector declined compared to September, with the bulk coming from the Whop platform. Real-world asset (RWA) tokenization projects raised $137 million across six rounds, AI projects — $74 million across seven.
Public companies in the industry additionally raised $853 million through share offerings and $11 million through PIPE — private investment in public equity. Together with venture, the total across all channels reached $2.52 billion, of which $838 million came from Strive. According to a late SEC filing, on October 12–13 Strive received another $369 million from warrant exercises, which would raise the overall total to $2.88 billion. This money finances the business and assets of public companies, so it does not reflect demand for startups.
Where else major investors are looking
The concentration of capital in a few large bets is noticeable beyond the crypto industry as well. IMF experts estimated that the AI investment boom is keeping global economic growth around 3% despite a spike in energy prices, so AI has naturally entered the top four largest categories of crypto venture.
Institutional investors are also seeking alternatives in classic portfolios. Fidelity's Director of Global Macro Jurrien Timmer questioned the return of the 60/40 portfolio (60% stocks, 40% bonds): at current US Treasury yields, stocks and bonds still move in the same direction, and as a replacement he proposed a 60/20/20 allocation with gold, BTC and cash.
Cryptalist analysis: October's statistics demonstrate not a recovery of crypto venture but its deep fragmentation: the expansion of the institutional investor pool with an almost unchanged number of deals points to cautious interest rather than a return of risk appetite. While the median check declines and the lion's share of capital goes to isolated stories like Kalshi, the market remains a market of selective bets — and it is this selectivity, not volume, that will determine the dynamics of the coming quarters.