Crypto investment firm Paradigm is seeking to raise $1.5 billion for a new fund that will invest in companies in AI, robotics and other frontier technologies, according to the Wall Street Journal.
Paradigm will continue to invest in crypto companies, according to sources familiar with the situation, but it will use its existing technical investment team to look at deals in frontier tech companies, they said.
San Francisco-based Paradigm has $12.7 billion in assets under management, according to the latest regulatory filings.
It launched its flagship $2.5 billion fund in November 2021, which was the largest crypto fund in history at the time. It publicly announced its third fund in 2024 — an $850 million venture fund focused on early-stage crypto projects.
According to the WSJ’s sources, the firm’s managers decided they didn’t want to be restricted in ways that could cause them to miss out on attractive deals.
There is also overlap between crypto and AI, such as agentic payments, or transactions made by autonomous AI agents, the person said.
Paradigm acknowledged it had been “tinkering” with AI and its convergence with crypto as early as three years ago.
In 2023, Paradigm was seen removing Web3 and crypto-specific language from its website, prompting some speculators to suggest it was already pivoting from crypto to AI.
Matt Huang, the co-founder and managing partner of Paradigm, denied at the time that the website changes reflected a shift away from crypto, but acknowledged that the team had been exploring AI.
In a lengthier tweet weeks later, Huang said that while “we’ve never been more excited about crypto and continue to invest across all stages,” the “developments in AI are too interesting to ignore.”
“It seems trendy to frame crypto vs AI as a zero-sum competition. But we don’t buy it. Both are interesting and will have plenty of overlap. We’re excited to continue exploring,” he said.
Earlier this month, Paradigm and OpenAI released EVMbench, a new benchmark evaluating how different AI models can detect and patch security vulnerabilities found in smart contracts.
In 2025, venture capital investments in AI firms amounted to $258.7 billion, accounting for 61% of all VC investment and doubling its share from 2022, according to OECD.
VC funding for generative AI firms made up 14% of all AI venture capital investments, with firms in the United States attracting the largest share of VC funding.
