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PitchBook recently released its Q1 2023 Crypto Report, dedicated to crypto investments, which shows that the most active companies in terms of investments are Binance and Coinbase.

The PitchBook report shows that cryptocurrency companies raised $2.6 billion in venture capital globally in the first quarter of 2023, with 353 funding rounds.

While these are still big numbers, they represent an 11% decrease in total deal value and a 12.2% decrease in the number of deals compared to the previous quarter.

In fact, from this perspective, the first quarter of 2023 was the worst since late 2020, i.e. before the start of the last big bull run. It also marks the fourth consecutive quarter of declining investment activity in the crypto sector.

However, while it was a down quarter overall, there were some upside parameters in the detail.

For example, seed rounds were up 33.3%, while late-stage rounds grew by as much as 209.2%. The biggest problem was the 16.7% drop in early-stage rounds.

Furthermore, the most notable acquisition, according to the report, was that of streaming platform Streami by Binance, through the acquisition of a majority stake in Streamis GOPAX exchange.

In fact, the real decline began in the second quarter of 2022, the quarter in which the Earth/Moon ecosystem imploded.

In fact, the all-time high was reached in the first quarter of that year, the quarter that followed the crypto markets all-time highs.

Since then, the decline has been continuous, although much less pronounced in the last quarter than in the previous three.

It should be noted that the current level of investment in the crypto sector is lower than in the first quarter of 2021, when the last major bull run was just beginning, but still significantly higher than in the last quarter of 2020.

Thus, for the time being, the current level remains higher than the pre-bull run level.

The report notes that the crypto market has grown rapidly over the past decade, attracting a large number of users, including institutional investors who have poured billions of dollars into it.

Blockchain technology itself has also evolved, moving far beyond the simple recording and transfer of value to being used for secured lending, automated market making and the tokenization of off-chain assets.

According to PitchBook analysts, future cryptocurrency innovation could even threaten established players such as Visa, Mastercard and American Express, which have enjoyed decades of total dominance due to their ability to charge fees of up to 3%.

However, the collapse of several crypto companies in 2022 highlights that there are still significant challenges in the industry, so much so that mainstream adoption is unlikely to happen before better regulations and guidelines are released, according to the report.

The lack of clear regulation would be a major concern for the crypto industry, so much so that it is seen as a limiting factor.

The report cites the EUs MiCA as one of the most comprehensive regulatory frameworks already in place.

PitchBook analysts believe that 2023 could be a turning point for the industry, as they expect financial regulators and central banks around the world to increase their focus on cryptocurrencies starting this year.

They also state that cryptocurrencies and web3 will continue to grow and evolve in the future, despite the recent challenges that have emerged over the past year.

They highlight how the crypto ecosystem has made significant progress in recent years, including decentralised finance (DeFi).

In this regard, they note that the crypto industry is still in its early stages, so there is still plenty of room for growth and innovation.

Speaking of the future, they expect established exchanges such as Binance and Coinbase to become active acquirers in 2023, particularly by targeting smaller competitors such as cryptocurrency exchanges, custodian services or peripheral activities such as financial technology (fintech) securities brokerage.

In other words, if so far many of the key players in new investment in the crypto sector have been funds or firms from the traditional investment world, it is possible that in 2023 it will be the larger crypto companies themselves that become the real protagonists in this regard.

Binance is the largest exchange in the world and Coinbase is the largest US exchange. Moreover, the demise of FTX has only strengthened these two giants, the latter of which is already listed on the Nasdaq.

Emerging opportunities in the crypto sector that investors could focus on include zero-knowledge proofing and Web3 identity.

Companies to watch include Intmax and Obol.

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Binance first for crypto investments - The Cryptonomist

The worlds largest crypto exchange is set to exit the Canadian crypto market. Binance announced earlier today that it will be winding down its operation in Canada, citing the challenging regulatory environment created by the enhanced investor protection commitments that were introduced by the Canadian Securities Administrators.

According to a recent tweet from Binance, the crypto exchange is proactively withdrawing from the Canadian marketplace. The tweet blamed Canadas new guidance related to stablecoins and investor limits published for crypto exchanges for the firms decision to exit the country. The regulations reportedly made Canada untenable for the firm to operate in.

The crypto exchange stated that Canada was a relatively small market, but held sentimental value given that it is the home country of founder and CEO Changpeng Zhao. The exchange explored reasonable avenues to protect its Canadian users, but all efforts were futile. In the tweet, the exchange thanked the Canadian regulators who collaborated with the exchange to address regulatory concerns.

While we do not agree with the new guidance, we hope to continue to engage with Canadian regulators aimed at a thoughtful, comprehensive regulatory framework.

As for the exchanges Canadian customers, the tweet clarified that they received emails containing comprehensive information regarding the impact of the latest development. Binance is confident that it will return to Canada once its regulators allow citizens to access a broader range of digital assets. With its latest decision, Binance joins fellow crypto exchanges OKX and dYdX, which announced their intention to depart Canada earlier this year due to the shakeup in regulations.

See the article here:

Binance Set To Leave Canadian Market Due To Unfavorable Regulatory Landscape - Ethereum World News

Leading market makers for the crypto market Jane Street and Jump Crypto are exiting the U.S. due to extreme regulatory crackdown, lack of regulatory clarity, and heightened scrutiny.

The US SEC-led crypto regulatory crackdown has raised a wide set of problems for leading crypto exchangesBinance, Coinbase, and other crypto-related entities, with some planning to move their operations offshore.

Two of the worlds top market-making firms Jane Street and Jump Crypto have decided to cease crypto trading in the U.S. amid an intense crypto regulatory crackdown in the US. The firms will continue market making and not leave the crypto market entirely, reported Bloomberg on May 10.

Jane Street preparing to scrap its global crypto expansion plans because regulatory uncertainty has made it difficult for the firm to meet internal standards.

Meanwhile, Jump Crypto, the digital asset division of Jump Trading, is exiting the US market but planning to expand its operations globally.

US federal departments and regulators have intensified regulatory crackdown against the crypto market following the FTX debacle and Terra-LUNA crisis. In fact, Jane Street and Jump Crypto were linked to FTX and Terra-LUNA crisis. Jump Crypto backed the TerraUSD algorithmic stablecoin by proving liquidity and funds, while Jane Street is cited by the US CFTC in its lawsuit against crypto exchange Binance. It is also linked to FTX and Sam Bankman-Fried. Many executives of FTX were earlier employees of Jane Street.

Also Read: Terraform Labs Moves Tokens Worth Millions A Year After Terra-LUNA Crisis

Market makers such as Jane Street and Jump Crypto support the crypto market by providing liquidity. Troubles due to lack of liquidity were one of the primary reasons for the crypto contagion seen last year.

The crypto market has already been becoming less liquid throughout the year and Jump and Jane Street pulling back their market-making activity will put further pressure. Coinbase and Binance are witnessing less liquidity as compared to earlier quarters.

CoinGape Media earlier reported, the U.S.-licensed crypto exchanges lost market share in 2023 Q1, with Coinbase accounting for 1.31%, Kraken 0.60%, and Binance.US 0.37%. Moreover, Coingecko reported a continuous decline in trading volume on Coinbase from 7% in January to 5% in March. Meanwhile, trading volume on crypto exchanges outside the U.S. rising due to the regulatory crackdown against crypto in the US.

Also Read: US SEC Is Reportedly Close To Taking Enforcement Action Against Binance

Varinder has 10 years of experience in the Fintech sector, with over 5 years dedicated to blockchain, crypto, and Web3 developments. Being a technology enthusiast and analytical thinker, he has shared his knowledge of disruptive technologies in over 5000+ news, articles, and papers. With CoinGape Media, Varinder believes in the huge potential of these innovative future technologies. He is currently covering all the latest updates and developments in the crypto industry.

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Binance, Coinbase Impacted As Jane Street, Jump Crypto Exit US Market - CoinGape