Ukraine Crisis Primes Crypto, Cybersecurity for Venture Funding Boost, Experts Say

The war in Ukraine underscores the need for decentralized solutions, according to Hunter Horsley, CEO of Bitwise

article-image

Blockworks exclusive art by axel rangel

share

key takeaways

  • The intensifying conflict between Russia and Ukraine has highlighted the use case around cybersecurity and Web3, industry experts say
  • Venture capitalists are going to want in on the growing space, analysts say

Increasing concern over the escalating conflict in Ukraine is likely to lead to a renewed push into decentralized finance and Web3 investments, experts say.

While crypto has always faced criticism for its bad actors, according to Jessica Rabe, co-founder of DataTrek Research, digital assets are still a necessary “decentralized way to store and transfer capital.”

“There are too many positive and lucrative opportunities with the blockchain and Web3 that venture capitalists will want to keep trying to capitalize on,” Rabe said.

Venture capital investments into blockchain startups have hit $3.8 billion so far in 2022, on pace to surpass 2021’s total of $17.9 billion, according to Crunchbase data. Crypto startups received $2.1 billion in 2020 and $2.9 billion in 2019.

“We expect VCs to keep putting money to work in the blockchain and Web3 amid the push to a decentralized internet and finance,” Rabe said. “Big Tech companies dominate today’s internet, so Web3 offers the opportunity to develop the next major online platforms and apps to drive engagement and therefore profits.”

The war in Ukraine underscores the need for decentralized solutions, according to Hunter Horsley, CEO of crypto asset manager Bitwise.

“As it pertains to Web3, I think [the conflict] is absolutely galvanizing entrepreneurs to work on building the decentralized, permissionless systems of the future,” Horsley said. “I think you’ll see more projects and likely investments in identity and media and nonprofit fundraising and DAOs, and a renewed conviction in the importance of the existing platforms like Bitcoin, Ethereum and layer-1s and DeFi.”

Cybersecurity in particular is expected to see major growth, Rabe said, “especially with hacks and cyber threats stemming from the Russia and Ukraine conflict shining a light on its importance.”

The three largest cybersecurity-focused ETFs have all increased in assets under management by more than 9% over the past five days. The Global X Cybersecurity ETF is up 11.4%.

“VCs putting more money to work in cybersecurity is positive for investors in public markets, who have taken notable interest in the space since Russia invaded Ukraine,” Rabe said.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates.png

Research

Pipe Network is a decentralized content delivery network (dCDN) that replaces the sparse, capital intensive data center footprint of traditional CDNs with a permissionless mesh of independent node operators. By orchestrating under-utilized resources that already exist at the edge, rather than purchasing or leasing thousands of servers, Pipe slashes capital intensity while letting supply expand autonomously in the places where bandwidth is scarcest and most expensive.

article-image

Sponsored

Fluence is a decentralized marketplace that connects businesses requiring enterprise-grade computing power with professional infrastructure providers

article-image

What if growth goes exponential while you’re hiding in gold and bitcoin?

article-image

While Compass Point analysts downgrade its Circle price target, Jefferies initiates Galaxy coverage with ‘buy’ rating

article-image

Friday News potpourri: Here’s what’s shaping up across Bitcoin, Ethereum and beyond.

article-image

A little inside baseball about crypto news

article-image

Dragonfly’s Rob Hadick and Empire’s Jason Yanowitz talked about the market and what they’re watching