According to Patrick Hansen, EU Policy Director at Circle, VC investment in European crypto projects has increased almost 10 times in a year, which can be attributed to new EU laws, particularly MiCA.
MiCA Spurs Surge in VC Funding for EU-Based Crypto Startups
The European crypto market has seen a significant increase in venture capital (VC) funding in recent months, which executives attribute to landmark crypto regulation in the European Union (EU). The Markets in Crypto Assets (MiCA) regulatory framework was approved earlier this year and is set to become law in July 2023.
The new legislation is aimed at regulating crypto assets and those involved in transacting them, including individuals and entities, making it the first major step towards regulating the industry globally.
The introduction of MiCA has garnered support from various executives in the crypto industry, with some hoping that other nations will follow the EU’s lead in enacting similar laws.
Patrick Hansen, the EU Policy Director at USD Coin (USDC) stablecoin issuer Circle, has stated that VC investment in European crypto projects has increased “almost 10x in one year” and can be attributed to the new laws in the EU, particularly MiCA.
Hansen shared a screenshot from PitchBook, which shows that in Q2 2023, Europe accounted for 48% of all VC funding that went to crypto startups.
London-based crypto startups have emerged as the most successful in securing venture capital (VC) funding in 2023, despite England no longer being part of the European Union (EU), according to a study conducted by investment firm Rockaway. The study found that London-based firms secured the most investment, followed by Zurich and Berlin.
In 2022, VC funding for crypto startups in Europe reached a total of $5.7 billion, as per the findings of Rockaway. The report highlighted the increasing importance of VC funding for startups in the crypto space, particularly in light of the potential for further legislation and regulation in the industry.
Hansen, a spokesperson for Rockaway, emphasized that the proposed legislation could provide a significant boost to investment and involvement in the crypto space, indicating a promising future for the sector. The findings of the report are likely to encourage further investment in crypto startups across Europe, as they continue to attract attention from venture capitalists.
The absence of clear regulatory guidelines has caused anxiety among executives in the crypto industry. Despite this, Europe has become a ray of hope for crypto startups during this challenging period.
The introduction of new regulations in European markets has drawn increased attention. However, venture capital (VC) funding for crypto startups took a massive hit in the first quarter of 2023, plummeting by 82%.
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