Decentralization Funded by Centralization: Understanding Crypto Joint-Investment Network
Junyu Zhang, Chenyu Zhou, Wei Cai · 2025
In the crypto industry, venture capital investors provide funding to drive the domain towards its decentralized vision, while many individual investors follow online investment news to aid their decision-making.By scraping investment event data from crypto data analytics websites, we construct and analyze the joint investment network of venture capital investors in the crypto industry.Our study reveals the centralized nature of the investor network in this supposedly decentralized domain, by identifying central nodes such as Coinbase Venture and disclosing their persistence of dominance, despite Coinbase's relatively small market share as an exchange.Based on node features, we divide the network into different communities, hinting at investor clustering.To measure the robustness of this network, we simulate various attack strategies to model bankruptcy and risk propagation, confirming its vulnerability as seen in historical events.Additionally, using graph neural network approaches, we fill in unknown structural information of investors, mitigating information asymmetry in investment disclosures and achieving classification accuracy above 70% for tier ratings and over 65% for investor types.Results are validated using data from another platform, exhibiting consistency.This study sheds light on the dynamics of joint investment networks in this emerging tech domain, offering insights for both potential and existing investors.