Crypto M&A value soared 5000 per cent in 2021, says PwC report
The value of merger and acquisitions in the crypto industry skyrocketed by 4,846 per cent in 2021 according to PwC.
The total value of M&A deals in 2021 was $55bn, up from $1.1bn the previous year the PwC report revealed. The average deal size reached $179.7m from $52.7m, driven in part by the rise of high value special-purpose acquisition company (SPAC) deals.
In the largest disclosed crypto M&A of the year, Bullish went public on the New York Stock Exchange through a merger with Far Peak Acquisition through a SPAC deal worth $9bn.
The wave of deals shows no sign of slowing in 2022 according to Henri Arslanian, PwC’s crypto leader. In comments to Bloomberg he said that valuations have hit levels “that are often difficult to justify.”
Trading companies, such as exchanges and payments infrastructure firms, attracted the greatest volume of crypto M&A activity last year, while mining companies trailed behind. Analysts at PwC said the diversified number of deals across business sectors highlight the continuing maturity of the crypto ecosystem and can be taken as a sign of the broader adoption of crypto services.
The value of fundraising deals rose by 645 per cent with firms AU21, Genesis Block Ventures, Genblock Capital, Coinbase Ventures and Moonwhale among the top five investors by deal count.
The data comes amid an explosion of venture capital funding in the crypto space, with $31.6bn poured into projects in 2021, more than the ten previous years combined according to Pitchbook data. The momentum has continued into 2022 with a number of high value new funds launched since the start of the year.
Some of the largest funds have come from established players within the digital asset industry.
US based investment fund Andreessen Horowitz has plans to launch crypto funds worth $4.5bn, FTX last month unveiled a $2bn crypto VC fund and Crypto.com is growing its venture capital arm to $500m. Reddit co-founder Alexis Ohanian has raised $500m for a crypto fund at his VC firm 776.