Artificial intelligence (AI)'s lead over cryptocurrencies in attracting venture capital has widened in Q1 2025, but does it matter in this race?
Despite the crypto “Trump Rise” in late 2024, deal flow is still favorable for AI. But is AI really now favored over crypto?
Sam Reynolds | Edited by Oliver Knight Updated 14 Mar 2025 15:14 UTC Published 14 Mar 2025 06:11 UTC
What is important to know:
- In the first quarter of 2025, US venture funding for cryptocurrencies amounted to about $861 million, but it is significantly smaller than funding in the artificial intelligence (AI) field, which reached almost $20 billion.
- Notable AI deals include Databricks' $15.3 billion funding round and Anthropic's $2 billion raise, while the largest crypto deal is Abu Dhabi-based MGX's $2 billion investment in Binance.
- Historical data shows a consistent preference for AI over cryptocurrencies in venture funding, with AI funding growing from $670 million in 2011 to $36 billion in 2020.
According to Pitchbook, U.S. venture funding for cryptocurrencies in the first three months of 2025 was about $861 million, but that's dwarfed by AI investments, which totaled nearly $20 billion. That points to investors' continued preference for AI.
Data shows that investors made 795 AI deals in the U.S. from January to March, with headlines focused on notable deals such as Databricks' $15.3 billion round and Anthropic's $2 billion raise.
By comparison, the largest deal in crypto was Abu Dhabi-based MGX’s $2 billion investment in Binance, the first institutional listing on the crypto exchange. Other notable deals include an $82 million raise from payments infrastructure company Mesh, a $70 million round from ETF issuer Bitwise, and a $58 million offering from digital asset bank Sygnum.
Pitchbook previously reported that AI startups will attract a third of global venture capital investment in 2024, totaling $131.5 billion, with AI companies accounting for nearly a quarter of new startups in 4,318 venture deals, while cryptocurrencies raised $4.9 billion in just 706 deals.
Analysis: Has AI Taken Venture Dollars Away from Cryptocurrency?
High-profile VC rounds in AI, and high-profile initiatives like OpenAI's Sam Altman's trillion-dollar push, as well as AI's transformation from a tech novelty to a generic name thanks to transformative models, have raised speculation that investors are suddenly choosing one over the other.
Historical data confirms that venture capitalists generally favor AI over cryptocurrencies, with AI and machine learning receiving steady funding that has grown exponentially, according to Statista: from $670 million in 2011 to $36 billion in 2020 and has continued to increase since then.
In one year, cryptocurrencies have overtaken AI in terms of funding: in 2021,
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