Cryptocurrency industry trends in the first half of 2024 from crypto startups

Author: qw & Chloexyg, AllianceDAO; Translation: Jinse Finance xiaozou

At AllianceDAO, we receive about 3,000 applications for crypto startup accelerators every year. We collect a lot of data to understand what the underlying chains of these projects are, what types of products they have, where their base camps are, and so on. Because of the large sample size and the fact that we are relatively unaffected by these factors, we are able to form unique insights about the direction of industry development.

1, Public Chain

(1) L1

Ethereum remains the dominant ecosystem. Solana is making a comeback after bottoming out in the second half of 2022. It may not be a coincidence that FTX also collapsed in the second half of 2022. Bitcoin is experiencing a renaissance, with strong interest in ordinals, runes, and Bitcoin L2.

(2) Ethereum L2

Look at Ethereum L2 (and sidechains). Over the past three years, optimistic rollup has received a lot of attention. It is worth noting that in the first half of 2024, more than a quarter of startups built on Ethereum L2 chose Base.

2. Products

More and more startups are building infrastructure, DeFi, payments, and AI x Crypto. Among them, the infrastructure and AI fields are aligned with public discourse. But the rise of DeFi and payment fields may surprise most people because the public is hardly interested in them. Coincidentally, in our opinion, they are also the only two verticals with real PMF (product market fit) found in the crypto world.

Note that this is an imperfect classification of products, and it is clear that these categories overlap to a certain extent. For example, a startup may operate both games and NFT categories. In this case, we will assign a weight of 0.5 to games and NFTs respectively.

3, Geographical distribution

In the first half of 2024, we saw the lowest proportion of startups in the United States and Canada, while the proportion of startups in Asia and Africa was the highest ever. This may be due to the uncertainty of US regulation and the increasing practical application of cryptocurrencies in emerging markets.

Overall, North America, Europe, and Asia remain the top three crypto startup bases, with the number of startups in each region accounting for 1/4 to 1/3 of the total.

4, founder background

(1) Large technology companies

The proportion of founders from "large technology companies" backgrounds peaked in 2021 and is currently 30%. The large technology companies mentioned here refer to technology companies in the S&P 500 index. The specific definition is not important, what is important is the trend over time.

(2) Top Universities

Similarly, the percentage of founders graduating from “top universities” peaked in 2021. We define top universities as universities in the top 100 of the QS global rankings.

（3) Multiple entrepreneurs

About one in ten entrepreneurs have founded a startup before.

5、Team Composition

（1）Team Size

More than half of startups have only 2 to 5 people. We also happen to believe that this is the optimal size for startups in the pre-PMF stage.

（2）Co-founders

Less than 40% of startups are founded by a single founder. Various studies show that 20-30% of unicorn companies were founded by a single founder.

（3） Equity Split

Among startups with 2 or more co-founders, about half of them choose to divide equity equally.

（4） Remote Work

Nearly 3/4 of startups have adopted a fully remote work model.