PwC: Crypto M&A and Fundraising in Asia Reports Major Growth

• Crypto activity has shifted significantly from the Americas to APAC/EMEA
• Crypto equity fundraising ticket sizes have increased by 50%
•  Crypto M&A and fundraising activity have increased by 51% in 2019

PwC previewed its latest white paper—PwC Global Crypto M&A and Fundraising Report—last Thursday at CoinDesk’s Invest: Asia event. The report was further shared by Henri Arslanian, the global crypto leader at PwC, via LinkedIn. This is the first report by PwC on the broader crypto ecosystem, but the firm will continue to publish updates twice a year moving forward.

Insights

Both cryptocurrency M&As and fundraising deals in the Americas have fallen to 41% in H1 2019 in comparison to the 60% of overall global deals reflected in the data for H1 2018. Although the Americas still count as the key driver, Asia and the Middle East now assume the bulk of the activity with five out of the top ten crypto M&A deals.   

According to the report, the average crypto equity fundraising tickets have increased from US$6 million to US9million, marking a 50% increase in H1 2019 compared to H1 2018.

Despite a notable drop in the number of deals in Q3 2018, the crypto market rebounded in Q1 2019 and PwC reports an overall increase in crypto M&A of 15% activity at Q2 2019. Fundraising deals have also increased by 51% when comparing Q2 2019 vs Q1 2019.

Trends for Q3 & Q4 2019

Historically crypto fundraising and M&A appears to be positively correlated with the price of Bitcoin. PwC expects this trend to continue and recent surges in market activity should empower the cryptocurrency exchanges and leading industry players with confidence and it is expected that they will look to acquire and expand in the second half of 2019.

The noted rise of 51% in capital allocated to fundraising activities, from Q1 2019 to Q2 2019, indicates that investors may seek further exposure in the crypto market by backing institutional-grade companies.

The surge of activity in the crypto space from Q1 to Q2 2019 has seen many global players, who had up until recently been sitting on the sidelines, rejoin the market. PwC’s report indicates the accelerated involvement of these investors has been accelerated by the anticipated launch of Facebook’s cryptocurrency Libra and other recent macro events and announcements from major institutions.  

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