THE STATE OF CRYPTO VC

Summary from the TLDR Crypto newsletter

Crypto VC faces a challenging environment with lower returns to LPs resulting in tougher fundraising conditions, though 2025 capital deployment remains on pace with 2024 despite slower deal counts, and improving M&A activity (NinjaTrader, Privy, and Bridge acquisitions) signals better exit opportunities. Three major shifts are emerging: tokens replacing dual token/equity structures as the primary investment mechanism, fintech VCs converging with crypto VCs as payment rails move onchain, and the rise of "liquid venture" where funds invest in public tokens with VC-like return profiles. Despite challenges, crypto remains at the frontier of venture innovation with its blend of public/private markets and hyper-power law outcomes, positioning it to continue attracting capital seeking asymmetric returns as more assets move onchain.