KuCoin Research has revealed that the cryptocurrency sector attracted over $1 billion in investments during May 2024, a slight dip from April but showing notable interest in Ethereum and related technologies.
According to a report released on June 13 by KuCoin Research, May saw the disclosure of 156 investments in the crypto space, totaling $1.02 billion in capital inflows. This marks a 10.61% increase compared to May 2023 but represents a 6.4% decrease from April 2024.
Focus on Ethereum and EVM-Compatible Projects
Ethereum, Ethereum Virtual Machine (EVM) chains, and layer-2 (L2) network projects continued to be the focal point for institutional investors. These technologies offer scalable and versatile platforms for decentralized applications, which are crucial for the evolving blockchain ecosystem. Despite the dominance of Ethereum-based investments, non-EVM chains like Bitcoin, Solana, Fantom, and The Open Network (TON) also remained popular among investors. These networks are gaining traction due to their unique capabilities and growing ecosystems.
Active Investors and Deal Highlights
Animoca Brands and OKX Ventures emerged as the most active investors in May. Animoca Brands participated in 15 deals, showcasing its continued commitment to expanding the digital asset space, particularly in gaming and metaverse projects. OKX Ventures followed closely with 11 investments, focusing on innovative blockchain startups. Other notable investors included Cogitent Ventures, SNZ Holding, and DWF Labs, engaging in 10, 8, and 7 deals respectively.
| Investor | Number of Deals | Key Focus Areas |
|---|---|---|
| Animoca Brands | 15 | Gaming, Metaverse |
| OKX Ventures | 11 | Blockchain Startups, DeFi |
| Cogitent Ventures | 10 | Early-Stage Blockchain Projects |
| SNZ Holding | 8 | Diverse Crypto Investments |
| DWF Labs | 7 | Digital Assets, Technology Innovations |
KuCoin Research observed a shift in retail investor behavior in May. Due to concerns about the low float and high fully diluted valuations (FDV) trend in the cryptocurrency market, many retail investors turned their attention to meme tokens and celebrity-associated tokens. These assets, often launched with lower market caps and more accessible valuations, provided an alternative to high-valuation tokens with limited circulating supplies.
Spotlight on Notcoin (NOT)
A standout example of this trend was Notcoin (NOT), a token that gained significant popularity in May. Unlike many tokens that gradually release their supply, Notcoin launched with all tokens available from the outset, which contributed to its rapid growth. On June 3, NOT became the fifth most-traded cryptocurrency, surpassing the trading volume of the popular stablecoin USD Coin (USDC). Its price reached a new all-time high of $0.02896 on June 2, pushing its market capitalization above $2 billion.
| Metric | Value |
|---|---|
| All-Time High Price | $0.02896 |
| Market Cap | Over $2 billion |
| Trading Volume Rank | 5th most-traded crypto (June 3) |
The report from KuCoin Research underscores the dynamic nature of the cryptocurrency investment landscape. While institutional investors maintained their focus on established technologies like Ethereum and EVM-compatible projects, retail investors explored alternative narratives through meme tokens and low-market-cap assets. The activity in May reflects a broader trend of diversification within the crypto market, as both institutional and retail participants seek to capitalize on emerging opportunities and navigate the complexities of valuation and liquidity. As the market continues to evolve, these investment patterns provide valuable insights into the priorities and strategies of different investor segments.
Featured image credit: Petai Jantrapoon via Vecteezy