KPMG: Amid the global AI wave, the number of active companies in Australia’s blockchain and crypto industry fell 14% year-on-year

According to a recently released KPMG report, the number of active companies in Australia's blockchain and cryptocurrency industry has dropped from 85 to 74, a year-on-year decrease of 14%, the largest drop among all fintech sub-sectors. However, despite this, the sub-sector still includes well-known companies such as Independent Reserve, Swyftx and Coinspot. The report points out that the decline in the number of active companies in the blockchain and cryptocurrency industry is a microcosm of the broader financial industry situation in 2024. During this period, mergers and acquisitions (M&A) and investment activities in the financial industry were sluggish, and deal flow and capital expenditures were mainly capacity-oriented. In addition, M&A activity was mainly concentrated on a smaller number of large transactions. Regarding the possible reasons for the decline in the number of active companies in the blockchain and cryptocurrency industry, the report states: "Globally, the focus has shifted from blockchain technology to artificial intelligence this year, and investors have invested in the increasingly important field of AI to transform their businesses into future-oriented and AI-capable businesses. However, after some major and adverse events in the industry in previous years, the US SEC's move to approve a Bitcoin ETF this year may be the positive catalyst needed for the blockchain sector." The report added that the central bank's interest rate cuts may free up capital, which has the potential to be used in the blockchain and cryptocurrency industry.