The Web3 and AI Funding Bulletin | June I
Hello and welcome!
This is the Web3 and AI Funding Bulletin, covering the latest investments in companies converging blockchain and artificial intelligence. Back in May, the hype surrounding Crypto x AI seemed to have quieted down, at least from the vantage point of VCs, but June kicked off with a couple of high-profile deals. I strongly suspect that the summer of 2024 will bring loads of similarly exciting news!
Thank you for being here! Let's dive in!
Confidentiality Layer Fhenix Closes a $15M Series A Round
The Ethereum Layer-2 chain focused on confidentiality, Fhenix has attracted funding of $15M by Hack VC, Dao5, Amber Group, Primitive Ventures, GSR, Collider Ventures, and Stake Capital.
My newsletter has had many entries dedicated to the Fully Homomorphic Encryption (FHE) tech, and particularly to Fhenix, the company that uses Zama's FHE libraries with the ambition of becoming Ethereum's confidentiality layer. FHE allows for complex computations to be performed on encrypted data, which practically enables the execution of blockchain and AI operations without revealing the underlying data.
Blockchains are innately transparent, which is generally a positive trait, as long as you are not dealing with highly sensitive information. FHE is all the rage right now exactly because it is the solution that finally makes it possible to build decentralized applications in industries like traditional finance and healthcare while also ensuring users' privacy protection. It is no wonder that investors are excited by this prospect and are racing to fund companies like Fhenix.
For a long time use of FHE wasn't feasible due to its high computational expense, but advancements in FHE & computer hardware have changed this reality. Fhenix lowers the barrier to entry for Solidity developers to use FHE with the first FHE EVM-compatible Layer 2 rollup.
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Right around the time of this funding round's announcement, Fhenix has also launched its testnet Helium, thus empowering developers to deploy confidential smart contracts.
NEAR Modular Spun Off into Nuffle with $13M in Funding
The blockchain network NEAR seems to be undergoing serious transformations. Two weeks after establishing AI-focused development lab, incubator, and funding entity, NEAR's co-founder Illia Polosukhin announced the spin-off of its NEAR Modular division into Nuffle Labs.
NEAR Modular, now Nuffle, consists of NEAR's Data Availability (NEAR DA) and Fast Finality (NFFL) Layers. Its mission is to provide cost-efficient and developer-friendly data availability and fast settlement as a service to other chains and rollups.
Nuffle's founding was actually made possible through a $13M funding by Electric Capital with participation by Canonical Crypto, Fabric Ventures, Robot Ventures, Caladan, and Lyrik Ventures, and a strategic grant by NEAR Foundation. Moreover, big names from the industry joined as angels, including EigenLayer's Sreeram Kannan, Polygon's Sandeep Nailwal, FraxFinance's Sam Kazemian, Dovey Wan, Jordi Alexander, and Erica Kang.
Jamie Crawley
“We are thrilled about the incredible opportunity to grow and develop NEAR’s modular product offerings at Nuffle Labs,” said Altan Tutar, CEO of Nuffle Labs. The other Nuffle co-founders are Sam Wang, Firat Sertgoz, and Donovan Dall. “We deeply appreciate the support from the NEAR Foundation and are honored by the validation from such distinguished investors. Their confidence in our vision and capabilities energizes us as we continue to innovate and expand.”
NEAR Team
Web3 + AI Game Ecosystem Pixelverse Raised $5.5M
Cyberpunk entertainment studio and game ecosystem Pixelverse has raised $5.5M in a money round led by Delphi Digital, Merit Circle, Mechanism Capital, Bitscale Labs, and prominent angel investors from the gaming world.
Pixelverse is pioneering Tap-to-Earn, blending GameFi and SocialFi. With 10M daily battles in their Telegram app, PixelTap, they're setting new standards.
Pixelverse has attracted over 15M users in less than a month. For context, Instagram took nearly a year to reach 10M users. [...] PixelTap has become one of the most viral products in tech history, with millions engaging daily.[...] Pixelverse is already past the inflection point, making mass adoption a reality. Next, they aim to transition 100M Web2 gamers to Web3.
Marketing and AI Data Platform Cookie3 Gets $5.5M
The marketing analytics portal offering on- and off-chain data and AI tools, Cookie3 has attracted a stellar line-up of investors and backers. Its $5.5M funding round was led by The Spartan Group and Animoca Brands, and supported by GSR, ChainGPT, Polkastarter, Orange DAO, Big Brain Holdings, LD Capital, Castrum Capital, and more.
Data Provenance Layer Irys Attracts $3.5M of Strategic Funding
Lemniscap led the $3.5M strategic funding round into the Crypto x AI data provenance layer Irys. The other participants included Framework Ventures, Primitive Ventures, and Hypersphere Ventures.
In the age of proliferating AI content generation tools and deep fakes, solutions like Irys are paramount for the identification of authentic and credible data.
AI x Blockchain Metadata Protocol Codatta Closes $2.5M Seed Round
Codatta, a data confidence protocol for AI, has attracted $2.5M in a seed funding round led by OKX Ventures. Mask Network, Oak Grove Ventures, GoPlus Labs, zCloak Network, and others also participated.
[Codatta] has assembled a sizable network of data contributors to enhance data confidence through AI-verified evidence, multi-party cross-referencing, and staking-as-confidence. Developers can create Web3-native applications powered by machine learning models in areas such as criminal-resistant networks, on-chain advertisement, dApp-agnostic recommendation systems, and credit-based lending products.
OKX VenturesCARV Receives Backing by double jump.tokyo
A little over a month after closing its $10M Series A round, the AI and Gaming-focused modular blockchain CARV announced it received a strategic investment by Web3 gaming leader double jump.tokyo.
The partnership with double jump.tokyo marks another significant milestone in CARV's rapid growth trajectory. By consolidating its position alongside web2 and web3 gaming heavyweights like Animoca Brands, Neowiz’ IntellaX, and Netmarble's MARBLEX across Asia, CARV is solidifying its position as the preeminent gaming and AI data layer, ready to catalyze industry-wide innovation.
GamingWire
Revox, PrivateAI, Zircuit, Optopia Collect Undisclosed Funding
The rest of the capital rounds involving blockchain x AI company over this past fortnight were of undisclosed financial dimensions. They comprise:
- AI Agent-enhanced smart contract platform Revox which was backed by SevenX Ventures, Arweave SCP Ventures, 7UpDAO, and others.
- AI-powered knowledge protocol and Data-as-a-service (DaaS) provider PrivateAI which received strategic funding by DEXTools, GAINS Associates, Samara Asset Group, and others.
- Zircuit, the ZK rollup with AI-enabled security, obtained funding by Binance Labs.
- AI-Driven L2 chain Optopia closed a seed round with the support of KuCoin Ventures, JRR Group, Klein Labs, and MrBlock.
This milestone will help us build the next-gen AI + layer2 blockchain, accelerating an AI-driven, intent-centric Layer2 network that allows permissionless intent creation.
Disclaimer: None of this should or could be considered financial advice. You should not take my words for granted, rather, do your own research (DYOR) and share your thoughts to create a fruitful discussion.
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