Crypto-focused venture capital firm Escape Velocity has raised nearly $62 million to invest in decentralized physical infrastructure network (DePIN) projects, signaling continued venture interest in the sector despite a broader slowdown in crypto and technology funding.
As first reported by Fortune on Thursday, the raise marks Escape Velocity’s second fund dedicated to backing founders across DePIN and other crypto-native sectors. The fund closed in December and drew support from investors including Marc Andreessen, co-founder of Andreessen Horowitz, and Micky Malka, founder of Ribbit Capital.
Cendana Capital, a venture fund-of-funds that invests in early-stage managers, allocated $15 million to the vehicle.
Escape Velocity co-founder Mahesh Ramakrishnan said the DePIN sector remains underdeveloped relative to its potential, largely due to the structure of many recent projects.
“A lot of what you’ve seen in the last three years are DePIN projects that have launched tokens before they have anything,” Ramakrishnan told Fortune. “They’re launching tokens on the basis of hype and on the basis of an idea.”
The gap between hype and real-world utility remains wide, but many industry proponents believe the sector is still in its early stages. HashKey Capital’s head of investment research, Jeffrey Hu, told Cointelegraph last year that his firm is “especially bullish” on DePIN solutions because they help bridge the physical and digital worlds.
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DePIN has become an overlooked sector, research shows
Despite broader industry headwinds, a narrow segment of DePIN projects continues to show signs of traction. According to Escape Velocity and Messari’s latest “State of DePIN” report, the sector’s combined market capitalization stands at roughly $10 billion, with networks generating an estimated $72 million in onchain revenue in 2025.
Messari characterized DePIN as a relatively small but resilient category, noting that revenue-producing networks have continued to operate even as token prices across the sector have sharply declined.
Many DePIN-related tokens remain down between 94% and 99% from their all-time highs, underscoring the gap between market valuations during the previous cycle and current adoption levels. Still, the report suggests that a subset of projects tied to active physical infrastructure has been more durable than price performance alone would indicate.
Other research suggests that DePIN projects are gaining traction in jurisdictions with clearer regulatory frameworks and more immediate infrastructure demands, including the United Arab Emirates and Singapore. Analysts note that these markets often provide faster pathways for deployment and partnerships, reinforcing the view that DePIN adoption may emerge outside traditional Silicon Valley–centric startup ecosystems.
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