A16z Leads Crypto Funding
Venture giants deployed record weekly capital while retail traders remained sidelined, marking institutional-led recovery
Six cryptocurrency startups raised a combined $214 million this week, with Andreessen Horowitz leading investments in two deals as venture capital flows back into digital assets amid Bitcoin's recent rally.
The week's largest deal saw Worldcoin secure $135 million through token sales, while AI-focused banking startup Catena Labs raised $18 million in a seed round backed by the NFL's Tom Brady, among others.
Worldcoin, which creates digital identities by scanning users' irises, sold WLD tokens to raise $135 million led by a16z crypto and Bain Capital Crypto.
The project has registered 26 million users, with 12.5 million holding verified digital IDs. Worldcoin's technology has drawn scrutiny from privacy advocates and regulators who question the collection of biometric data.
"This funding will allow us to expand our network and meet the growing demand for World IDs," said Chief Executive Alex Blania.
Catena Labs, founded by former Circle executive Sean Neville, raised $18 million from a16z crypto, Breyer Capital, Circle Ventures and Coinbase Ventures. New England Patriots quarterback Tom Brady also participated in the round.
The startup is developing what it calls an "AI-native bank" that uses artificial intelligence to automate trading and investment decisions. Catena Labs has no immediate plans to issue its own cryptocurrency, according to the company.
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Investors received equity stakes and token warrants for a future digital asset that has yet to be created.
The funding activity reflects renewed investor appetite for cryptocurrency startups after a period of subdued deal-making.
Andreessen Horowitz's crypto arm has deployed capital from a $4.5 billion fund raised in 2022, one of the largest dedicated to digital assets. The firm has invested more than $7.6 billion across crypto and Web3 companies since entering the sector.
Other deals this week included a $41 million Series B round for Slash, which provides banking services to crypto companies, led by Goodwater Capital. Three additional startups raised a combined $20 million, though details weren't disclosed.
Cryptocurrency startups are on track to raise $18 billion in 2025, according to data tracker DefiLlama, as institutional investors warm to digital assets following regulatory clarity in key markets.
The convergence of artificial intelligence and blockchain technology, exemplified by Catena Labs, represents a key investment theme as startups seek to differentiate themselves in an increasingly crowded market.
For investors, the week's activity suggests venture capital firms view current market conditions as favorable for deploying capital into cryptocurrency startups, particularly those addressing infrastructure needs or novel applications of blockchain technology.