AI boom leaves crypto VC fundraising in the dust, founders warn

AI startups are drawing capital away from crypto, raising investor performance expectations and squeezing fundraising for crypto founders, according to industry veterans. Paul Brody says benchmarks that once looked strong (~$2M first‑year revenue) now need to be closer to $4M, making it harder for crypto teams to compete. Still, VCs may moderate AI commitments, offering some relief. DefiLlama data shows nearly $37M flowed into crypto startups this week, led by three raises: BetHog ($10M), Hata ($8M) and KAIO ($8M). The piece signals short‑term fundraising pressure for crypto but notes ongoing deal activity and selective interest from major backers like Tether and Bybit.