Crypto VC Funding Soars: Marathon Digital Raises $850M, Subzero Labs Secures $20M in High-Profile Deals

Crypto VC funding reached nearly $2 billion in the past week, with Marathon Digital's $850 million convertible note offering and Mill City Ventures' $450 million move into Sui-backed tokenization leading the pack. Other notable raises include Ethereum-native treasury pivots from FG Nexus and ETH Strategy, as well as investments in AI identity platform Billions Network, infrastructure startup Subzero Labs, and stablecoin-focused Layer 1 Stable.

Crypto venture capital (VC) funding reached nearly $2 billion in the past week, driven by significant investments in various sectors. Marathon Digital's $850 million convertible note offering and Mill City Ventures' $450 million move into Sui-backed tokenization led the pack. Other notable raises include Ethereum-native treasury pivots from FG Nexus and ETH Strategy, as well as investments in AI identity platform Billions Network, infrastructure startup Subzero Labs, and stablecoin-focused Layer 1 Stable [1].

According to the latest report from Galaxy Insights, Q2 2025 saw crypto VC activity at its second smallest since Q4 2020, with $1.97 billion invested across 378 deals [1]. Despite the overall decline in venture capital activity, sectors such as AI, blockchain infrastructure, and trading continued to draw significant investment. Later-stage deals captured 52% of the capital invested, while earlier-stage deals accounted for the rest.

The U.S. dominated capital and deal count again, reclaiming the top spot after MGX’s Binance investment pushed Malta to No. 1 last quarter. The mining category led with a $300 million investment in cloud-mining firm XY Miners, followed by $200 million+ invested in the privacy/security and infrastructure categories [1].

Fundraising for crypto venture funds remains challenging, with the macro environment and turmoil in the crypto market continuing to dissuade allocators. However, the first half of 2025 has shown a positive start, on pace to exceed the amount allocated in 2024 [1].

The United States continues to dominate the crypto startup ecosystem, with 47.8% of capital invested and 41.2% of deals completed going to companies headquartered in the U.S. [1]. The new presidential administration and Congress have begun enacting the most pro-crypto policies in history, which is expected to further solidify U.S. dominance in the sector.

References:
[1] https://www.galaxy.com/insights/research/crypto-blockchain-venture-capital-q2-2025