Cryptocurrency-focused venture capital firm Escape Velocity has raised nearly $62 million to invest in decentralized physical infrastructure network (DePIN) projects, signaling continued interest in projects in the sector despite a broader slowdown in cryptocurrency and technology finance.
As Fortune first reported on Thursday, the raise marks Escape Velocity’s second fund dedicated to supporting founders across DePIN and other crypto-native sectors. The fund closed in December and was backed by investors including Marc Andreessen, co-founder of Andreessen Horowitz, and Micky Malka, founder of Ribbit Capital.
Cendana Capital, a venture fund that invests in early-stage managers, has committed $15 million to the vehicle.
Mahesh Ramakrishnan, co-founder of Escape Velocity, said the DePIN sector remains underdeveloped compared to its potential, largely due to the structure of many recent projects.
“A lot of what I’ve seen in the last three years is DePIN projects launching tokens before they had anything,” Ramakrishnan told Fortune. “They launch tokens based on hype and based on idea.”
The gap between hype and real-world benefit remains wide, but many industry proponents believe the sector is still in its infancy. Jeffrey Ho, head of investment research at HashKey Capital, told Cointelegraph last year that his company is “particularly bullish” on DePIN solutions because they help bridge the gap between the physical and digital worlds.
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Research shows that DePIN has become a neglected sector
Despite broader industry headwinds, a narrow slice of DePIN’s projects continue to show signs of traction. According to Escape Velocity and the latest “State of DePIN” report from Messari, the combined market value of the sector is approximately $10 billion, with networks generating an estimated $72 million in onchain revenue in 2025.
Masari described DePIN as a relatively small but resilient category, noting that revenue-generating networks have continued to operate even as token prices have declined sharply across the sector.
Many DePIN-linked tokens remain between 94% and 99% below their all-time highs, underscoring the gap between market valuations during the previous cycle and current adoption levels. However, the report notes that a subset of projects associated with active physical infrastructure were more sustainable than price performance alone would indicate.
Other research suggests that DePIN projects are gaining traction in jurisdictions with clearer regulatory frameworks and more demanding infrastructure requirements, including the UAE and Singapore. Analysts point out that these markets often offer faster paths to deployment and partnerships, reinforcing the view that DePIN adoption may emerge outside traditional Silicon Valley-centric startup ecosystems.
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