author: Tethkar Research
Prepared by: Deep Tide TechFlow
Deep diving: Cryptocurrency funding data for the first four months of 2026 reveals a harsh reality: the gaming and DeFi sectors have almost exhausted their funding, while prediction market companies Kalshi and Polymarket took in more money than all DeFi projects combined for the entire year. Even more worrying is the fact that the number of M&A deals has caught up with seed rounds, suggesting that capital is shifting from betting on new ideas to acquiring existing leaders.
Funding Overview: The March increase was an illusion
From January 1 to May 6, 2026, the cryptocurrency industry completed 305 financing rounds, totaling $8.65 billion. However, the $4.57 billion “raise” in March was actually just two mega-mergers: BVNK, worth $1.8 billion, and Kalshi, worth $1 billion.
Excluding these two, the actual funding pace is about $1 billion per month, which is even lower than it was at the end of 2025.
Money flow: payments and consumption make up 72%
Divided by path:
Payments: $3.74 billion (56 deals)
Spending: $2.48 billion (35 deals)
DeFi: $1.06 billion (47 transactions, the highest number of transactions)
The payment and consumer sectors together accounted for 72% of the total financing for this year. Funding for the games and DePin has all but disappeared.
Prediction markets dominate the consumer sector
The two prediction market companies accounted for 18% of their total funding for this year:
Everything: One billion dollars
Polymarket: $600 million
These two deals, totaling $1.6 billion, exceed the total of 47 DeFi funding rounds.
Mergers and acquisitions have become the trend
Mergers and acquisitions amounted to 48 (23% of known stage transactions), which equates to approximately 57 seed deals (27%). This cycle has shifted from investing in new ideas at their early stages to acquiring industry leaders.
Amending the classifications of investment institutions
The most active funds in 2026:
Coinbase Ventures: 18 deals (2nd place during 2021-2026)
Tether: 13 deals (new lead investor)
Animoca Brands: 11 entries (1st place during 2021-2026)
GSR: 11 entries
a16z: 7 deals (a significant decrease compared to about 200 deals during the period 2021-2026)
