Dragonfly Capital has invested $10 million in cryptocurrency derivatives exchange Bitget, the San Francisco-based venture capital firm announced April 4. The funds will be used to support Bitget’s ongoing global market and service expansion and upcoming efforts aimed at cryptocurrency education and adoption.
Bitget revealed that since its inception in 2018, the exchange has grown to include more than 80,000 traders and 380,000 copy traders, or individuals who use automation to synchronize their trading positions with traders. For its 2023 roadmap, Bitget plans to expand its Spot Trading, Launchpad, and Bitget Earn products. Dragonfly has invested in well-known blockchain companies such as Matter Labs, 1inch, and Polygon. The firm reportedly manages $3 billion in assets in 2022. Crypto derivatives exchanges were negatively impacted by the FTX crash in November. At the time, the exchange was facilitating $6.6 billion in contract volume per day, with $5.1 billion in open interest.
According to data from Coinmarketcap and CoinGecko, since the FTX collapse, open interest on centralized exchanges has recovered to about $68.5 billion at the time of publication, from an estimated nadir of $60.1 billion in December 2022.
While the market has stabilized from the worst of the FTX crash, the crypto industry still faces issues, such as the recent CFTC lawsuit against Binance. Binance attracted about 2.8 million U.S. customers without registering with regulators, the CFTC said. Interestingly, since sellers are responsible for conducting due diligence before potential customers in the U.S. are onboarded, so-called users themselves are less likely to face the consequences of being on an exchange.
