2026 Crypto Funding Shake-Up: Gaming and DePIN Are Dead; Prediction Markets Capture 18% of Full-Year Funding in Just Two Deals

Author: Memento Research

Translated and compiled by TechFlow

TechFlow Intro: Crypto funding data for the first four months of 2026 reveals a harsh reality: funding for gaming and DePIN has nearly dried up, while prediction market firms Kalshi and Polymarket raised more capital than all DeFi projects combined over the entire year. Even more alarmingly, the number of M&A deals has matched seed rounds—indicating that capital is shifting from betting on new ideas toward acquiring established leaders.

Funding Overview: March’s Surge Was an Illusion

From January 1 to May 6, 2026, the crypto industry completed 305 funding rounds totaling $8.65 billion. However, the “surge” of $4.57 billion in March was driven almost entirely by just two mega-M&A deals: BVNK’s $1.8 billion round and Kalshi’s $1 billion round.

Excluding these two, the true monthly funding pace is approximately $1 billion—slower than at the end of 2025.

Funding Allocation: Payments and Consumer Capture 72%

By sector:

Payments: $3.74 billion (56 deals)

Consumer: $2.48 billion (35 deals)

DeFi: $1.06 billion (47 deals—the highest number of transactions)

Together, payments and consumer account for 72% of total funding this year. Financing for gaming and DePIN has virtually disappeared.

Prediction Markets Dominate the Consumer Sector

Two prediction market companies captured 18% of total funding this year:

Kalshi: $1 billion

Polymarket: $600 million

Combined, these two raised $1.6 billion—more than the total raised across all 47 DeFi deals.

M&A Has Become Mainstream

M&A deals reached 48 (23% of known-stage transactions), nearly matching seed rounds at 57 (27%). This cycle has shifted from early-stage investment in novel ideas to acquiring industry leaders.

Venture Capitalist Rankings Shake Up

Most active funds in 2026:

Coinbase Ventures: 18 deals (ranked #2 overall from 2021–2026)

Tether: 13 deals (new top lead investor)

Animoca Brands: 11 deals (ranked #1 overall from 2021–2026)

GSR: 11 deals

a16z: 7 deals (a sharp decline compared to ~200 deals from 2021–2026)