Q1 2026 crypto startup funding reaches $5B, with prediction markets leading at $1.7B

Huo Xing Cai Jing reports, according to DL News citing DefiLlama data, that crypto startups raised nearly $5 billion in the first quarter of 2026, a 16% year-over-year decline, but the investment ecosystem continues to evolve, with capital shifting clearly from speculative tokens toward practical sectors such as payments and transaction infrastructure. The prediction markets sector led with over $1.7 billion, followed by payments infrastructure at $735 million and transaction infrastructure at $423 million. Top non-crypto institutions including Sequoia Capital, Founders Fund, Bain Capital, and Alibaba have also accelerated their entry. The top ten funding projects in Q1 are as follows: • Kalshi: $1 billion, $22 billion valuation, led by Coatue Management, regulated leader in prediction markets by the CFTC • Polymarket: $600 million, backed by Intercontinental Exchange (ICE), leading decentralized prediction market platform • Rain: $250 million Series C, nearly $2 billion valuation, led by Iconiq Capital, stablecoin payment infrastructure • BitGo: $213 million, NYSE IPO, valuation over $2 billion, crypto custody provider • Flying Tulip: $206 million, public token sale, led by DeFi architect Andre Cronje, integrating trading, lending, and insurance • Whop: $200 million, backed by Tether