Big investors boost valuations of crypto companies

Venture companies and large investors are setting prices for crypto startups. Boutique investment firms and family offices are being destroyed by large venture capital firms, private equity funds and even some pension funds.

Venture firms raise prices for crypto startups
According to Henri Arslanian, crypto leader at PwC, a professional accounting and financial services company also known as Pricewaterhousecooper, cryptocurrency companies are showing high valuations as big investors come into space.

In an interview with Bloomberg on Thursday, the executive explained that boutique investment firms and family offices have been displaced by large venture capitalists, private equity funds and even some pension funds. He noted that small venture companies were not happy with the trend. Describe Арсланян:

Let’s say they’re looking for a deal and believe it’s worth $ 10 million, and you see big venture investors come in and offer a higher ranking. This usually happens to early-stage companies such as $ 5 to $ 20 million-prices are inflated.

According to the crypto m & a status report for 2021, the total value of the deal doubled to $ 1.7 billion, although transaction activity in 2020 increased by only 10% compared to the previous year. This was largely due to several large transactions in the crypto exchange, including the acquisition of Binance CoinMarketCap for $ 400 million and a FTX-Blockfolio transaction for up to $ 125 million. That trend continued this year when Galaxy Digital bought BitGo for $ 1.2 billion.

In July, the FTX derivatives exchange’s valuation rose to $ 18 billion after raising $ 900 million from investors. In addition, digital asset platform Fireblocks has raised $ 310 million to reach a value of $ 2 billion.

Arslanian explained that there are some problems with the pricing of cryptocurrency initiatives. These include, in particular, ways to reduce regulatory risks in such a new industry and ways to reduce cost.

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