Escape Velocity, a cryptocurrency-focused venture capital firm, has raised nearly $62 million in investment for its Decentralized Physical Infrastructure Network (DePIN) project, demonstrating continued venture interest in the space despite a broader slowdown in cryptocurrency and technology funding.
As first reported by Fortune on Thursday, the funding marks Escape Velocity’s second fund dedicated to supporting founders across DePIN and other crypto-native sectors. The fund closed in December and attracted support from investors including Andreessen Horowitz co-founder Marc Andreessen and Rivit Capital founder Micky Malka.
Cendana Capital, a venture fund of funds that invests in early-stage executives, has earmarked $15 million for the vehicle.
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Mahesh Ramakrishnan, co-founder of Escape Velocity, said the DePIN sector remains untapped compared to its potential, mainly due to the structure of many recent projects.
“A lot of what we’ve seen in the last three years are DePIN projects that launched before they had any tokens,” Ramakrishnan told Fortune. “They are issuing tokens based on hype and ideas.”
Although the gap between hype and practicality remains large, many industry supporters believe the field is still in its infancy. Jeffrey Hu, head of investment research at Hashkey Capital, told Cointelegraph last year that the company is “particularly bullish” on the DePIN solution as it helps bridge the physical and digital worlds.
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Study finds that DePIN has become a neglected field
Despite industry-wide headwinds, some DePIN projects continue to show signs of traction. According to Escape Velocity and Messari’s latest “State of DePIN” report, the sector has a combined market capitalization of approximately $10 billion, and the network will generate an estimated $72 million in on-chain revenue in 2025.
Messari characterized DePIN as a relatively small but resilient category, noting that the revenue-generating network continues to operate despite sharp declines in token prices across the sector.
Many DePIN-related tokens remain down between 94% and 99% from their all-time highs, highlighting the gap between the previous cycle’s market valuation and current adoption levels. Still, the report suggests that some of the projects associated with active physical infrastructure are more durable than price performance alone would indicate.
The market capitalization of the DePIN project has fallen below $9 billion, compared to a peak of more than $43 billion in late 2024. source: depin scan
Other research suggests that DePIN projects are gaining traction in regions with clearer regulatory frameworks and more pressing infrastructure needs, such as the United Arab Emirates and Singapore. Analysts note that these markets often offer faster paths for expansion and partnerships, reinforcing the view that adoption of DePIN may emerge outside of the traditional Silicon Valley-centric startup ecosystem.
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