- London is the crypto hub of Europe boasting the most VC investment amid an all-time European high.
- Oslo has seen the most growth in VC investment in the past year.
- CeFi companies receive the highest amount of VC investment.
Investment in European crypto startups has reached its highest level so far, growing at a time when investment in other regions shows signs of slowing down..
CEO of BanklessTimes.comThe European crypto startup landscape may not be the largest in the world. However, it’s leading in growth, regulation, and resilience.
This BanklessTimes.com report lays out the top European cities and sectors that buzz with crypto VC activity.
The Map of Crypto VC Funding in Europe
There is significant growth showing already. In moments of global uncertainty, Europe upgraded from $5 billion in VC funding in 2021 to $5.7 billion in 2022, according to research.
Furthermore, Europe’s rebellious growth becomes even more interesting in the global context, in which a total of $31.4 billion was raised in 2022. At $5.7 billion, Europe received the second largest VC investment after the US ($17.1 billion, down from $17.7 billion in 2021).
For comparison, Chinese startups received $156 million, the rest of Asia attracted $5.5 billion, $2.2 billion went to the rest of the world, while another $2.2 billion is marked as unknown.
At the same time, Europe is close second to the US when it comes to the number of VC-backed startups: 1974 compared to the US’s 2193.
One of Europe’s prime advantages is its system of regulations. It allows crypto startups to improve their operations and adjust to world-leading regulations, all combined with the world’s top financial institutions.
Top 10 Crypto Hubs in Europe
When it comes to Europe’s top crypto hubs, according to VC investment in 2022, London remained at the top with $1.6 billion.
The Swiss crypto valley with Zurich and Zug to its south is still a strong player with $1.0 billion in 2022, while Oslo recorded outstanding growth in VC funding of +872%.
| Rank | City | Crypto VC investment in 2022 | YoY increase/decrease |
| 1 | London | $1.6 billion | ↑ +7% |
| 2 | Zug+Zurich | $1.0 billion | ↑+123% |
| 3 | Berlin | $541 million | ↑+388% |
| 4 | Paris | $403 million | ↓-67% |
| 5 | Tallinn | $210 million | ↑+281% |
| 6 | Oslo | $177 million | ↑+872% |
| 7 | Stockholm | $130 million | ↑+265% |
| 8 | Barcelona | $85 million | ↑+503% |
| 9 | Munich | $69 million | ↑+176% |
| 10 | Amsterdam | $46 million | ↓-60% |
Finance, Infrastructure, and Web3 Receive the Most VC
While financial services make up more than half of the total European investment in crypto, this sector declined by 19% compared to 2021.
CeFi Leads the Way in Financial Services
| Rank | Type of Service | VC investment in 2022 | YoY increase/decrease |
| 1 | CeFi | $1.7 billion | ↓-25% |
| 2 | DeFi | $1.2 billion | ↑+120% |
| 3 | Crypto Custody | $588 million | ↓-42% |
| 4 | Centralized Exchanges | $450 million | ↓-70% |
| 5 | Decentralized Exchanges | $413 million | ↑+199% |
| 6 | Crypto Payments | $103 million | ↓-45% |
| 7 | Fiat-crypto Ramp | $99 million | ↑+19% |
| 8 | Crypto Lending and Borrowing | $56 million | ↓-23% |
Crypto infrastructure receiving the most VC
On the other hand, investment in the second-largest sector, infrastructure, increased by 24%. Its largest segment, blockchain infrastructure, received $1.8 billion in funding in 2022. The fastest-growing segment was Developer Tools, having grown six times in funding.
| Rank | Type of Infrastructure | VC investment in 2022 | YoY increase/decrease |
| 1 | Blockchain Infrastructure | $1.8 billion | ↑ +24% |
| 2 | Layer1 | $440 million | ↑+155% |
| 3 | Developer Tools | $364 million | ↑+611% |
| 4 | dApps | $208 million | ↓-66% |
| 5 | Compliance | $196 million | ↑+46% |
| 6 | Layer2 | $180 million | ↑+127% |
| 7 | Web3 Wallet | $158 million | ↓-65% |
| 8 | Rollups | $155 million | ↑+454% |
| 9 | Data Providers | $98 million | ↑+145% |
Web3 startup funding in Europe is picking up pace
Web3 is the third most interesting segment to investors, having received three times as many deals in 2022 compared to 2020. In 2020, the number of deals sealed for Web3 startup funding in Europe was 36, growing to 91 in 2021 and 112 in 2022. What’s more, in 2022, the Web3 segment started seeing significantly more deals exceeding $100 million in value.
In the overview of top sectors and hubs based on Rockaway’s State of European Crypto Startups 2023 Report, we can see that London remains on top of the funding game, while the finance sector receives more than half of all investment. Finally, European VCs are making sure infrastructure and Web3 continue to pave the way for the development of crypto.
