OKX Ventures: Crypto Startups Need More Than Strong Tech to Secure VC Funding

Crypto startups hoping to secure venture capital (VC) funding need to demonstrate more than just solid technology, according to Jeff Ren, founder of OKX Ventures, the investment arm of the prominent cryptocurrency exchange OKX. In a recent interview with Cointelegraph, Ren emphasized that the most successful crypto startups are those that can blend robust technical infrastructure with the ability to pivot and adapt to evolving market conditions.

“For founders looking to work with us, your tech needs to be solid, but we’re equally interested in how you adapt to what users actually need,” Ren explained. “Some of our best partnerships came from teams who pitched us early, weren’t quite ready, but came back stronger with solutions that perfectly matched where the market was heading.”

In an environment where VC funding for crypto startups has declined significantly since the peak of 2022, Ren’s comments highlight a shift in the investment landscape. According to PitchBook data, VC funding into crypto startups fell sharply in 2024, with only $10 billion invested across 1,940 deals — a significant drop from the $30.2 billion invested across 3,500 deals the previous year.

Despite the downturn, OKX Ventures has remained active, investing over $100 million in 2024 to fund 60 crypto startups. Ren and his team have focused their investments on ecosystems like Solana, Sui, Aptos, TON, and Bitcoin. To inform their decisions, OKX Ventures analyzes market trends and user needs through its OKX wallet, which serves as a key tool in shaping their investment strategy.

When considering new investment opportunities, Ren said that OKX first evaluates whether its wallet infrastructure can integrate with and create value for the startup. He cited Web3 gaming as a prime example of this approach. For a GameFi studio, OKX’s wallet could facilitate the purchase of in-game assets or provide on-chain liquidity, making it a valuable tool for game developers seeking to create a seamless user experience.

“If that’s the case, we’re happy to create a position within your project and connect you with our wallet,” Ren stated.

However, securing funding from OKX Ventures isn’t as simple as having a great product or tech. Ren acknowledged that, like many VCs, OKX has expanded its checklist for evaluating potential investments. This increased scrutiny comes as the crypto industry matures, and investors are looking for more than just promising concepts.

Shi Khai Wei, founder of cryptocurrency-focused VC firm LongHash Ventures, echoed this sentiment in a previous interview with Cointelegraph, noting that it has become harder to secure venture capital in the current cycle compared to the 2020-2021 period, when some startups raised tens of millions of dollars with little more than a white paper and a small team. Keiran Warwick, founder of the GameFi studio Illuvium, also highlighted that VCs are now demanding more comprehensive due diligence, including gameplay demos, artist portfolios, developer teams, and security audits before committing to investments.

Looking to the future, Ren expressed excitement about the potential of artificial intelligence (AI) to enhance decentralized finance (DeFi) trading. He sees AI as a key technology that can revolutionize the user experience in DeFi, particularly in optimizing trading strategies and improving liquidity. Additionally, Ren identified opportunities in technologies that bring intellectual property (IP) assets on-chain and in investing in the infrastructure for memecoins. He also remains confident that non-fungible tokens (NFTs) will eventually find their market fit, despite the current volatility in the space.

As the crypto industry continues to mature, Ren’s perspective underscores a broader trend: investors are increasingly seeking startups that combine strong technology with adaptability, market awareness, and the ability to execute on evolving user needs. For startups looking to attract VC funding in the current climate, it’s clear that merely having a good idea isn’t enough — a strategic, adaptable approach is key to long-term success.