Crypto VC Shifts Focus to Institutional-Friendly Infrastructure

Global venture capital funding in the cryptocurrency space is undergoing a significant shift. Funds previously focused on decentralized finance (DeFi) experiments are now rapidly pivoting towards infrastructure companies that prioritize connections to traditional finance and regulatory compliance. This trend signals a maturing market seeking broader adoption and integration with established financial systems.

The Rise of “Institution-Friendly” Infrastructure

Analysis of investment activity in February 2026 reveals a concentration of VC funding in sectors like stablecoin payment infrastructure, enterprise wallets, and real-world asset (RWA) tokenization. This indicates a strategic move towards building the necessary tools and frameworks for institutional investors to confidently enter the crypto market.

Stablecoins and Interoperability

A notable investment this month came from Arab Bank, whose fintech accelerator ‘AB Accelerate’ strategically invested in Ubyx, a stablecoin payment network. The Block reports that Ubyx is developing a network enabling financial institutions to issue, accept, and redeem digital currencies across multiple blockchains. This move suggests the financial sector is proactively preparing for the potential operation of central bank digital currencies (CBDCs) or tokenized deposits, focusing on interoperability as a key component.

RWA and Enterprise Wallets Gain Traction

Domestic capital is also reflecting this trend. Hanwha Investment & Securities invested approximately $13 million in Kresus, a U.S.-based enterprise wallet and RWA platform. This investment follows a memorandum of understanding signed in December 2025, demonstrating a commitment to on-chain conversion within the financial sector. Kresus’s “seedless” wallet and multi-party computation (MPC) security technology are designed to enhance institutional accessibility and security.

Regulatory Compliance as a Competitive Advantage

The importance of regulatory compliance is becoming a key differentiator for attracting VC funding. Novig, a sports prediction market, secured $75 million in Series B funding led by Pantera Capital, achieving a $500 million valuation. A crucial factor in Novig’s success was its proactive approach to obtaining licenses, such as from the U.S. Commodity Futures Trading Commission (CFTC). This demonstrates a shift towards legitimizing previously speculative markets through institutional licensing.

DeFi Focuses on Backend Infrastructure

Even within the DeFi space, investment is concentrating on settlement infrastructure rather than simple exchanges. ConsenSys led an investment in MYX, an on-chain derivatives protocol focused on building a shared clearing and settlement layer that utilizes account abstraction technology to consolidate liquidity across different blockchains.

Cooling Investment in Other Sectors

While infrastructure and compliance-focused projects are attracting significant funding, blockchain games and artificial intelligence (AI) sectors have seen relatively conservative investment activity, primarily at the seed stage. Centralized finance (CeFi) is currently prioritizing asset management efficiency and restructuring over new investments.

Looking Ahead: The Rise of “Institutional Connectors”

Industry analysts predict that the next upward cycle in the crypto market will be driven by “institutional connectors” – companies that bridge the gap between traditional finance and the decentralized world. This shift represents a move away from speculative investments towards long-term positioning based on anticipated changes in the regulatory environment. Cambridge Associates notes that blockchain and crypto-focused venture capital funds offer a compelling opportunity alongside traditional venture capital strategies, with potential for outperformance.