Paradigm Raises $1.5B Fund to Expand Beyond Crypto Into AI and Robotics

Paradigm, a leading cryptocurrency venture capital firm, is raising a $1.5 billion fund to diversify its investment strategy beyond digital assets into artificial intelligence, robotics, and other frontier technologies, according to sources cited by the Wall Street Journal.

The San Francisco-based firm, which currently manages approximately $12.7 billion in assets, will continue supporting blockchain ventures while simultaneously pursuing opportunities in adjacent technology sectors. Rather than establishing a dedicated division, Paradigm plans to leverage its existing technical investment team to identify and evaluate deals in these emerging fields.

Strategic Shift Reflects Evolving Tech Landscape

Paradigm's expansion comes after establishing itself as a dominant force in cryptocurrency venture capital. The firm launched a $2.5 billion flagship fund in November 2021, which stood as the industry's largest dedicated crypto fund at the time. It followed that success with an $850 million early-stage blockchain fund in 2024.

According to sources familiar with the firm's strategy, management determined that restricting investments exclusively to cryptocurrency could cause them to overlook compelling opportunities emerging across computing and automation technologies. This strategic pivot mirrors broader trends among technology investors as artificial intelligence fundamentally transforms software development and financial infrastructure.

Convergence of Crypto and AI Technologies

Paradigm executives have consistently emphasized the interconnected nature of blockchain and artificial intelligence. A prime example is agent-driven payments, where autonomous software systems execute financial transactions using blockchain infrastructure. This use case requires both AI-powered decision-making capabilities and decentralized settlement mechanisms.

The firm's interest in artificial intelligence predates this fundraising announcement. In 2023, industry observers noted that Paradigm quietly removed Web3-specific terminology from portions of its website, sparking speculation about a potential departure from digital assets. Co-founder and managing partner Matt Huang quickly dispelled these concerns, stating the firm had "never been more excited about crypto" while acknowledging the importance of studying AI's implications. Huang emphasized that the technologies should be viewed as complementary rather than competitive.

This convergence has already manifested in tangible projects. Earlier this month, Paradigm collaborated with OpenAI to launch EVMbench, a specialized benchmark tool designed to evaluate whether machine-learning models can detect and remediate vulnerabilities in smart contracts—a persistent security challenge in decentralized finance (DeFi).

AI Dominates Venture Capital Flows

Paradigm's fundraising initiative aligns with massive venture capital inflows into the artificial intelligence sector. According to OECD data, AI companies secured $258.7 billion in venture funding during 2025, representing 61% of total VC investment—approximately double their share since 2022. Generative AI firms alone accounted for 14% of AI-focused funding, with American startups capturing the largest allocation.

The competitive landscape intensified last month when Andreessen Horowitz raised over $15 billion in fresh capital, reinforcing its position as one of the most influential venture capital firms in the U.S. technology sector. The firm's 2025 investments alone represented more than 18% of total venture capital deployed across the United States, spanning infrastructure, applications, healthcare, growth investments, and its "American Dynamism" initiative.

Coinasity's Take

Paradigm's strategic expansion into AI and robotics signals maturation within the crypto venture capital landscape. Rather than abandoning blockchain investments, the firm is positioning itself at the intersection of transformative technologies where the greatest innovation may occur. As blockchain infrastructure becomes increasingly integrated with AI-powered applications—from autonomous agents to smart contract security—this diversification appears prescient rather than reactionary. The move validates the thesis that crypto's future lies not in isolation but in convergence with broader technological evolution.