Investment in cryptocurrencies to further slow down in second half of 2022: KPMG report

BENGALURU: Both the crypto space and blockchain globally experienced significant challenges during the first half of 2022, and investment in cryptocurrencies is expected to slow down further, said a new report.

KPMG's Pulse of Fintech H1'22 said the crypto-focused companies attracted only $14.2 billion during H1'22, including $1.1 billion raised by the Germany-based Trade Republic in June.

It said there could be a slowdown in crypto interest and investment, particularly in retail firms offering coins, tokens and non-fungible tokens (NFTs). In the Asia-Pacific region, crypto, NFTs and blockchain also came off the investment burner as well.

The report hinted that some cryptos might cut their valuations and work to raise money because it is their only option. Bitcoin, the largest cryptocurrency in terms of market capitalisation, fell below $19,000 on Wednesday afternoon.

Bitcoin has been plunging for a few months now, and according to experts, if selling pressure continues, it could trade lower at $17,000.

"While China has banned crypto trading outright, and India is considering following suit, the regulators in a number of other jurisdictions have continued to focus on finding ways to protect consumers while also fostering the evolution and growth of competitive and attractive crypto markets," the report pointed out.

It is said that well-managed crypto companies with healthy risk management policies, long-term vision, and strong cost and risk management will survive in the second half of this year.

The KPMG report also said that global fintech investments in the first half of 2022 fell to $107.8 billion with a total of 2,980 deals despite robust VC funding.

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Fintech investment in the Asia-Pacific region hit an annual record high of $41.8 billion with 607 deals. In the region, a number of fintech subsectors that attracted substantial interest and hype over the past 12 to 24 months cooled off considerably during the first half, including retail payments, insurtech, and B2C solutions, it added.

BENGALURU: Both the crypto space and blockchain globally experienced significant challenges during the first half of 2022, and investment in cryptocurrencies is expected to slow down further, said a new report. KPMG's Pulse of Fintech H1'22 said the crypto-focused companies attracted only $14.2 billion during H1'22, including $1.1 billion raised by the Germany-based Trade Republic in June. It said there could be a slowdown in crypto interest and investment, particularly in retail firms offering coins, tokens and non-fungible tokens (NFTs). In the Asia-Pacific region, crypto, NFTs and blockchain also came off the investment burner as well. The report hinted that some cryptos might cut their valuations and work to raise money because it is their only option. Bitcoin, the largest cryptocurrency in terms of market capitalisation, fell below $19,000 on Wednesday afternoon. Bitcoin has been plunging for a few months now, and according to experts, if selling pressure continues, it could trade lower at $17,000. ALSO READ | Regulations for cryptocurrencies necessary considering their destabilising effect: FM Sitharaman "While China has banned crypto trading outright, and India is considering following suit, the regulators in a number of other jurisdictions have continued to focus on finding ways to protect consumers while also fostering the evolution and growth of competitive and attractive crypto markets," the report pointed out. It is said that well-managed crypto companies with healthy risk management policies, long-term vision, and strong cost and risk management will survive in the second half of this year. The KPMG report also said that global fintech investments in the first half of 2022 fell to $107.8 billion with a total of 2,980 deals despite robust VC funding. ALSO READ | Cryptocurrencies clear danger, says RBI Governor Fintech investment in the Asia-Pacific region hit an annual record high of $41.8 billion with 607 deals. In the region, a number of fintech subsectors that attracted substantial interest and hype over the past 12 to 24 months cooled off considerably during the first half, including retail payments, insurtech, and B2C solutions, it added.