The Web3 + AI Funding Bulletin | June I
The Web3 + AI summer seems to have arrived with VCs pouring money into the space.
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.
Right around the time of this funding round's announcement, Fhenix 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.
“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.”
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.
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 tools for generating AI content 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.
CARV 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.
Revox, PrivateAI, Zircuit, Optopia Collect Undisclosed Funding
The following capital rounds were of undisclosed financial dimensions:
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.
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