Summary
Year-to-date 2025, crypto companies have raised over $16 billion through more than 100 M&A deals, putting the industry on track for a new record and surpassing 2024’s total deal value.
This cycle is fundamentally stronger, fueled by greater U.S. regulatory clarity and increasing global momentum.
The wave of strategic M&A and initial public offerings (IPOs) will carry into the next cycle.
Record-breaking merger and acquisition (M&A) and initial public offering (IPO) activity in 2025 is reshaping and elevating the crypto space. This is driving an influx of new capital, institutional investors, builders, and users, fueling blockchain innovation and adoption. This pattern is common among other major technological shifts, where decades of building precede explosive growth. While the rise of AI benefits from decades of infrastructure investment, crypto is maturing much faster. It benefits from a more advanced technological architecture, able to leverage better tools for accelerated development, which is why the underlying momentum of the current market is fundamentally different from previous cycles, driven more by strategic consolidation than speculative hype.
Momentum is Accelerating: Why This Cycle is Different
The crypto market moves in a sine wave-like pattern with ups and downs. Despite a slowdown in venture funding, underlying currents remain optimistic due to regulatory tailwinds, crypto-friendly governments, strong deal flow, companies like Robinhood doubling down on crypto, and crypto’s deep integration into adjacent verticals. Capital deployment fell significantly in 2023 after peaking in 2022, began recovering in 2024, and has accelerated markedly in 2025. Q2 2025 alone saw 31 deals over $50 million, with late-stage funding like IPOs, M&A, and debt financing driving growth. Year-to-date, $16.1 billion has flowed into crypto, yet crypto venture capital (VC), like traditional VC, is concentrated in fewer funds. When capital is concentrated, we typically see larger individual checks but fewer overall deals. This reflects the maturation of many crypto companies into growth-stage companies and indicates that the fundraising environment is more competitive than ever for both founders and investors.
A confluence of forces makes this cycle feel different. Token prices are rebounding, new products are launching, founders are gaining more confidence to build in the space, and regulatory tailwinds are providing clarity for stablecoins and digital assets, all bringing capital into the space. For years, regulatory uncertainty created friction between innovators and Web3 due to fears of potential reprisal. With the Trump administration's crypto-friendly stance, we are witnessing the foundational building blocks for on-chain adoption through legislation, namely The GENIUS Act and The Clarity Act. While we cannot say exactly how these bills will impact the distant future, it is certain that these discussions and actions will reduce the hesitancy to invest in the space, both intellectually and financially. Furthermore, the anticipated Fed rate cut in November is expected to drive more capital into risk assets, and Digital Asset Treasuries (DAT) are locking up capital in long-term assets. Investor risk aversion is fading, creating more positive flows.
Investment allocation is shifting, with one-third of capital flowing into "bottom-up" opportunities like perpetuals, token issuance platforms, prediction markets, and new forms of DeFi. The remaining two-thirds target "top-down" areas, including DAT, real-world assets (RWA), exchange-traded funds (ETFs), and companies going public. Public market assets are dominating this cycle, which in turn provides better access to crypto assets for the broader public, a very healthy sign for the industry. This balance indicates a maturing market that values both innovation and integration with traditional finance.
The blueprint for crypto legislation needs to be drawn near-term, and given the current pro-crypto administration, this window exists before the mid-2026 elections. The DeFi Education Fund, aiming to protect software developers, submitted a response to the Senate Banking Committee's Request for Information on Digital Asset Market Structure and recently released a discussion draft of the Responsible Financial Innovation Act of 2025. The Wyoming Blockchain Stampede 2025, held last week, focused on digital asset regulation, highlighting the urgency for clear crypto rules in the U.S. and the need for a balanced market structure. Members of the current administration attended, aiming to push forward-looking regulation. Heading into Q1 2026, we can expect an unprecedented, more solid regulatory foundation, especially given the time constraints.
Token Listings and the Reopening IPO Market
Fewer token listings in 2025, with fewer new tokens achieving profitability, are creating downward pressure on deal flow. Projects relying on token launches find it harder to raise capital without market traction. In contrast, the IPO window has reopened, with 95 companies going public in the U.S. by mid-June 2025, raising $15.6 billion, a 30% increase from 2024. Crypto-related IPOs, including Circle and BitGo, are leading this trend, with investors allocating capital to crypto equities over tokens. Circle went public on June 5, 2025, priced at $31 per share, and reached $233 by mid-July, a >5x return, with a market cap of $44.98 billion. More recently, Figure and Bullish had successful public listings, with Bullish raising $1.15 billion via stablecoin, a first. Crypto companies are now more focused on revenue and growth than speculative token launches. The crypto IPO and other "top-down" frenzy is attracting traditional investors through stable, revenue-oriented business models rather than volatile crypto itself. This is just the beginning of IPOs, with more in the pipeline for the coming months.
Acquisitions and Industry Maturation
2024 was a record year for M&A, with over 100 M&A deals totaling $1.73 billion, and 2025 is on pace to exceed 2024's deal count. From January to July this year, there have been 76 deals totaling $6.23 billion, which is 3.6x the total deal value for all of 2024, and the full-year count is on pace for ~130 deals at the current rate. The strong momentum in 2025 indicates more natural industry maturation than the release of pent-up demand. Strategic acquisitions, like Robinhood's acquisition of Bitstamp, show established players building integrated platforms. Robinhood's multi-billion dollar bet on the future of crypto further enhances the credibility of the entire ecosystem, with its Q2 2025 crypto revenue growing 98% YoY to $160 million, overall company revenue growing 45% to $989 million, and profit of $386 million. A pillar of retail stock trading, Robinhood's adoption of blockchain technology highlights a shift towards mainstream, regulated infrastructure. Similarly, late-stage deals, like Securitize's $400 million raise from Mantle in Q2 2025 for RWA tokenization and Kalshi's $185 million raise at a $2 billion valuation for prediction markets, underscore the focus on revenue-oriented, regulatory-compliant models.
These moves reflect the crypto industry's focus on partnering with traditional financial institutions rather than just chasing speculative opportunities.
Crypto's Macro Intersection
Crypto no longer exists in isolation; it's converging with today's frontier technologies and global finance. In AI, OpenMind's OM1 + FABRIC architecture addresses the "missing layer" in robotics, enabling different robots to work together through decentralization. Worldcoin's iris-scanning identity verification uses a blockchain-based identity layer, allowing AI Agents to authenticate and transact autonomously, solving a key challenge for secure interaction in crypto. Decentralized AI platforms like Sahara AI (a decentralized alternative to Scale AI) and Sentient (a decentralized Hugging Face) are disrupting traditional AI infrastructure. The application layer for crypto AI is still very early, but its potential could create an entirely new market structure through on-chain agents and trading systems, enabling high-frequency trading of tokenized stocks.
In payments, stablecoins, especially Circle's USDC, have become integral to the global payment system, and the introduction of The GENIUS Act has further accelerated USDC adoption. Circle reported Q1 2025 revenue growth of 58.6% to $579 million. Analysts project stablecoin daily volume could reach $250 billion within three years and potentially surpass traditional payment systems like Visa in the next decade if growth continues. Corporations like PayPal and Visa are exploring stablecoin integration, bringing stablecoins into mainstream payment rails. Robinhood's partnership with Arbitrum allows Robinhood users to trade USDC directly on Arbitrum, making stablecoin trading more accessible to everyday users. And the Robinhood partnership is just the tip of the iceberg; Arbitrum plays a key role in expanding stablecoin adoption, exemplifying how Layer2 solutions connect crypto to traditional finance.
This is where the most critical industries meet, bringing together experts from AI, fintech, and consumer tech, blurring industry lines. Crypto, as the backbone of decentralized systems, is positioning itself as a critical layer in the global technology stack.
Looking Ahead
We expect a stronger market cycle in Q4 2025 and Q1 2026. Unprecedented regulatory clarity, anticipated rate cuts, and significant capital inflows from strategic M&A and IPOs together build a solid foundation. This new momentum, driven by real-world utility, sets the stage for a period of accelerated growth. Our strategy is to leverage this moment to make concentrated, high-conviction investments in Series A companies poised to define their categories.
Year-to-date, U.S. IPOs have surged to 224. In the first half of 2024, there were 94 IPOs, compared to 165 in the first half of 2025, a 76% increase. There were 185 crypto-related transactions in the first half of 2025 alone, on track to surpass 2024's 248 acquisition deals. Prominent names like Circle and acquisitions of crypto companies by traditional finance giants signal strong momentum for the coming cycle.
The convergence of crypto with AI, payments, and infrastructure, combined with regulatory tailwinds and investor enthusiasm, will propel us into an era of accelerated growth. Against this backdrop, we continue to cement crypto's role as a pillar of global finance and technology.
