What the AI funding race means for digital assets
The convergence between blockchain technology and artificial intelligence is intensifying, with key industry figures like Ben Goertzel convinced that AI should be decentralized.
This convergence was even highlighted by the World Economic Forum, which argued in 2024 that “Synergies between spatial computing, blockchain and AI will augment our experiences and increasingly guide our interactions with the digital world.”
Prominent crypto venture capitalist Marc Andreessen believes control over AI is a top strategic priority for China and the United States, as the two nations enter a “Cold War-style” race for technological dominance.
AI venture capital took center stage at Web Summit Vancouver, one of the world’s leading tech conferences. I had the opportunity to moderate a panel exploring the core dynamics shaping AI investment at the base layer.
In this week’s Crypto Biz newsletter, we dive into the future of AI and crypto, unpacking major themes that have emerged over the past several months.
Who’s winning the AI funding race?
At Web Summit Vancouver, I moderated a panel on AI venture capital funding featuring George Mathew of Insight Partners, Cathy Gao of Sapphire Ventures and JP Sanday of Menlo Ventures.
We explored why the so-called “sudden” surge in AI funding has deeper roots, the rapid rise of generative AI and the high-potential use cases VCs are watching closely. While crypto was left off the agenda, the emerging trends highlighted by these VCs paint a clearer picture of innovation expected in the blockchain industry.
George and JP also discussed the US-China tech rivalry and its implications for AI infrastructure and data center development. At the same time, Cathy shared insights on how intensifying competition is impacting AI startup valuations.
AI venture capital is eating crypto’s lunch — for now
For all the talk about AI and crypto convergence, venture capital has strongly favored artificial intelligence startups recently.
In April, PitchBook data showed that AI startups attracted nearly 60% of global venture capital in Q1, totaling $73 billion over the three-month period.
A significant portion of that — $40 billion — came from a single funding round for OpenAI, whose ChatGPT models now boast over 180 million monthly active users.
Separate data from CryptoRank revealed that crypto and blockchain startups amassed $4.8 billion in first-quarter funding.
Circle co-founder: “AI agents will soon conduct most economic transactions”
Sean Neville, co-founder of stablecoin issuer Circle, has raised $18 million for a new venture aiming to build an “AI-native financial institution.”
The newly launched Catena Labs is backed by Andreessen Horowitz’s crypto-focused venture arm and aspires to become a fully regulated bank for the AI-driven economy.
While firms like McKinsey and EY have highlighted the transformative potential of AI agents in finance, the concept of “AI-native” financial institutions remains largely underreported.
Catena Labs argues that “traditional financial systems are unprepared and resistant to AI, hindering the growth of the agent economy.”
“AI agents will soon conduct most economic transactions,” Neville added.
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Decentralized AI on Solana
Another notable development in the blockchain-artificial intelligence nexus came from Nous Research, which recently secured $50 million to build decentralized AI on Solana.
The funding round, which was led by Paradigm, valued Nous Research at $1 billion, according to Fortune. The startup’s previous backers include Delphi Digital, North Island Ventures and Distributed Global.
Nous leverages Solana to incentivize user participation in developing its open-source AI models, aiming to rival major large language models like OpenAI and DeepSeek.
Unlike traditional centralized approaches, Nous is training its LLMs in a decentralized, community-driven manner — a strategy that sets it apart, according to Paradigm partner Arjun Balaji.
Founder @ Ethereal AI | Investor @ Ethereal Capital | Architect @ TAP
3moSome big risks to overcome that is for sure.
CEO | CTO | CISO | AI, Blockchain, Security | Built 3 startups backed by In5, Dubai Future Foundation, SINGTEL, Govt. of India | Keynote Speaker | Mentor@Stanford | Polygon,Solana,Filecoin,Chainlink,NEAR Grant winner
3moCointelegraph Interesting perspective on AI funding and its impact on digital assets. How do you foresee the intersection of AI and Web3 influencing investment strategies in 2025?
Editor/writer/bureau chief/regional editorial manager, covering all things Asia since 1999, and now the U.S., having moved recently from Hong Kong.
3moNice newsletter, Sam!