Where Blockchain Is Heading
What Trends Are Telling Us
“The best venture investors can see things before they are consensus. They can imagine how the world will be different in 5-10 years.”
That quote from Fred Wilson, Co-Founder of Union Square Ventures, indicates the role of venture capital in seeing and enabling the future. With every investment, venture capitalists are predicting where new markets, technologies, and business models can gain a foothold, address a growing opportunity, and potentially disrupt existing market leaders.
In this blog, I’ll show how one Alumni Ventures fund is a microcosm of the future of blockchain and fintech. I’ll also unpack recent history in these sectors and insights that can be derived from spotlight investments made by Alumni Ventures’ Blockchain and Fintech Fund.
WHAT IS THE AV BLOCKCHAIN & FINTECH APEX 20
AV’s Blockchain & Fintech Fund has been investing since 2021 and is now in its fifth vintage. The Blockchain & Fintech Apex 20 is a selection of the top 20 companies from AV’s portfolio of 75+ blockchain and fintech ventures.
Of note:
- HomeThese startups exemplify innovation, strong performance, and transformative potential in the digital economy.
- HomeMany of these high-demand opportunities required leveraging years of relationship-building to secure access.
HOW WERE THE COMPANIES SELECTED?
Our selection process included four key criteria:
- Home
Innovative Impact
Companies driving groundbreaking technological advancements. - Home
Performance
Demonstrated growth in revenue, user adoption, and market penetration. - Home
Upside Potential
Scalability, market opportunity, and long-term growth prospects. - Home
Strategic Fit
Alignment with AV’s vision of shaping the future of blockchain and fintech.
We also considered co-investment partnerships with leading firms, which underscore the credibility and potential of these ventures.
BREAKING DOWN THE APEX 20 BY SUBSECTOR
To provide clarity on industry trends and AV’s diversified portfolio construction, we’ve categorized the Apex 20 companies into key subsectors and provided color on each.
Apex 20 Portfolio Companies by Subsector
Portfolio companies are shown for illustrative purposes only; not necessarily indicative of any AV fund or investor. Investments shown are not available to future investors, except potentially in the case of follow-on investments. Past performance does not guarantee future results.
1. Decentralized AI & Data Infrastructure
This subsector focuses on ventures at the intersection of AI and blockchain technology. Companies here create decentralized systems that enhance data privacy, improve scalability, and provide robust infrastructure for AI-driven applications.
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0g AI
Optimizes AI models on blockchain networks, enhancing efficiency and reducing costs. 0g focuses on data availability and AI computational efficiency, akin to decentralized AWS services in Web2. Co-Investors: Hack VC, Gumi Crypto, LongHash, Dispersion Capital. - Home
PIN AI
Built the first open-source Personal Intelligence Network for decentralized, privacy-preserving AI applications. Similar to Apple's on-device intelligence, it ensures user data ownership without intermediaries, offering personalized, privacy-first AI models. Co-Investors: Hack VC, Andreessen Horowitz. - Home
Sahara AI
Provides token-based infrastructure to incentivize decentralized data labeling and contributions for AI training, akin to a decentralized ScaleAI, with plans to expand into computing infrastructure. Co-Investors: Pantera Capital, Binance Labs, Polychain Capital. - Home
Space and Time
Revolutionizes data infrastructure with verifiable queries and privacy-focused analytics. Bridging Web3 scalability with Web2 adoption. Co-Investors: Lightspeed, Hivemind, M12 (Microsoft), Framework, DCG.
2. Blockchain Protocols & Scaling Solutions
Projects in this category enhance the fundamental capabilities of blockchain networks, focusing on scalability, efficiency, and interoperability.
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Algorand
A high-performance blockchain platform optimizing speed, security, and scalability through its pure proof-of-stake protocol. Co-Investors: Coinbase Ventures, OKX Ventures, ParaFi Capital, Multicoin Capital. - Home
Aurora
Enhances Ethereum compatibility with scalable infrastructure, operating as an Ethereum Virtual Machine (EVM) on the NEAR Protocol. Co-Investors: Pantera Capital, Electric Capital, Dragonfly, Fabric Ventures. - Home
Quai Network
Develops next-generation blockchain protocols for high-speed, low-cost transactions using a unique consensus mechanism. Co-Investors: Polychain Capital. - Home
Mysten Labs
Drives blockchain scalability through its Layer 1 infrastructure, Sui, designed for speed and efficiency using the Move programming language. Co-Investors: Andreessen Horowitz, Jump Crypto, Apollo, Binance Labs.
3. Next-Gen Financial Platforms
These companies redefine financial services delivery through fintech innovations, often leveraging technologies like blockchain for transparency and efficiency.
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Alto IRA
Democratizes access to alternative investments with a user-friendly IRA platform for crypto, private equity, and real estate. Co-Investors: Sequoia Capital, Foundation Capital, Acrew Capital, Tribe Capital. (Sponsored by AV First Check Fund 1) - Home
Carta
Streamlines equity management and ownership tracking for private companies, enhancing transparency in the fintech ecosystem. Co-Investors: Andreessen Horowitz, Meritech Capital Partners, Tribe Capital. (Sponsored by Purple Arch Ventures 2) - Home
Method
Simplifies debt repayment and financial management through APIs that integrate debt management into fintech apps. Co-Investors: Andreessen Horowitz, Abstract Ventures, Hack VC. (Sponsored by Congress Avenue Ventures 3) - Home
Upstart
Leverages AI for smarter, more inclusive lending decisions with advanced credit risk modeling. Co-Investors: First Round Capital, GV, Khosla Ventures, Kleiner Perkins. (Sponsored by Blue Ivy Venture 1)
4. Digital Asset Ecosystem
This subsector includes companies building infrastructure for managing, exchanging, and utilizing digital assets, such as stablecoins and crypto exchanges.
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Circle
Facilitates secure digital currency transactions through stablecoins like USDC, with robust payment and treasury infrastructure. Co-Investors: Accel, Sequoia, BlackRock. - Home
Kraken
A leading cryptocurrency exchange known for robust security and broad asset support. Co-Investors: Borderless Capital, SkyBridge Capital, Andra Capital. - Home
SoSo Value
Innovates in asset management with blockchain-based on-chain ETFs, providing AI-powered financial research for digital assets. Co-Investors: Sequoia China.
5. Bitcoin & Crypto Security
This subsector includes companies enhancing security, compliance, and resilience within crypto ecosystems.
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Babylon
Pioneers Bitcoin-staking protocols, integrating Bitcoin into proof-of-stake ecosystems to enhance network security. Co-Investors: Paradigm, Polychain, Hack VC, IDG Capital, DHVC. - Home
TRM Labs
Provides blockchain intelligence and risk management tools to detect and prevent crypto-related fraud. Co-Investors: Bessemer Venture Partners, Thoma Bravo, PayPal, Blockchain Capital. (Sponsored by Green D 5)
6. Decentralized Social, Identity Networks, & the Future of Governance
Companies in this space shift control of data and digital identities from centralized platforms to individuals, enabling trustless, user-owned networks. Blockchain technologies also power new governance models like DAOs, redefining decision-making, digital democracies, and systemic transformation.
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Bluesky
A decentralized social media platform built on the AT Protocol, promoting data sovereignty and open algorithms. Co-Investors: Bain Capital, Blockchain Capital. - Home
Autonomys
Provides decentralized storage and identity solutions focused on data privacy and security. Co-Investors: Polychain Capital, Outliers Fund, Coinbase Ventures. - Home
Playtron
Develops an open operating system for PC gaming, unifying access across platforms with a focus on community and performance. Co-Investors: Bitkraft Ventures, Samsung, Galaxy Interactive.
These classifications highlight AV’s diversified investments across emerging technologies, underscoring the growth potential in decentralized systems, fintech innovations, and blockchain infrastructure. Now let’s review the historical trends we’ve observed since the inception of our funds.
INDUSTRY EVOLUTION: KEY TRENDS OVER TIME
The blockchain and fintech landscape has undergone significant shifts.
2021 – 2022: Blockchain Foundations and Scaling
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Infrastructure Development
Focused on building the core protocols and scaling solutions necessary for blockchain to handle increased demand and complex applications. - Home
Consensus and Security Innovations
Enhanced mechanisms for transaction validation and network security, laying the groundwork for more efficient and secure decentralized systems. - Home
Integration with Traditional Finance
Expansion of blockchain technology into mainstream financial services, highlighting its potential to transform existing financial infrastructures.
2023 – 2024: Web2.5 Integration and Applications
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Convergence of Web2 and Web3
Bridging the gap between traditional internet experiences and decentralized technologies to improve usability and drive mainstream adoption. - Home
Decentralization Beyond Finance
Applying blockchain principles to new areas such as data ownership, social networks, and digital identity, expanding its relevance beyond financial services. - Home
Empowerment of User Control
A shift towards user-centric models where individuals have greater ownership of their data, digital assets, and online interactions.
HOW OUR BLOCKCHAIN PORTFOLIO ALIGNS WITH THESE TRENDS
2021 – 2022: Blockchain Foundations and Scaling
Blockchain Protocols & Scaling
- HomeAlgorand refined its high-performance proof-of-stake (PoS) model.
- HomeAurora and Mysten Labs launched Layer 1 and EVM-compatible solutions to address Ethereum's congestion and high fees.
- HomeQuai Network introduced novel consensus mechanisms for high throughput while maintaining a proof-of-work (PoW) model.
- HomeAutonomys built a Layer 0 network to scale blockchain storage and decentralized digital identity infrastructure.
Digital Asset Ecosystem & Fintech
- HomeEstablished platforms like Kraken, Circle, Carta, and Upstart gained momentum as blockchain's potential in finance became more widely embraced.
Compliance and Security
- HomeTRM advanced blockchain security and financial integration.
- HomeBabylon extended Bitcoin’s PoW security to PoS chains, offering staking rewards for Bitcoin holders.
2023 – 2024: Web2.5 Integration and Applications
Decentralized AI & Data Infrastructure
- HomeA new wave of startups (0g AI, PIN AI, Sahara AI, Space and Time) emerged, integrating AI with blockchain to enhance privacy, scalability, and data ownership.
Rise of Web2.5 Applications
Web2.5 bridges Web2 usability with Web3 decentralization, enabling mainstream adoption without sacrificing user experience.
- HomeBluesky empowers users with a decentralized social network, promoting transparency and data sovereignty.
- HomeSoSoValue democratizes blockchain finance through on-chain ETFs and inclusive investment strategies.
- HomePlaytron merges an open cross-platform gaming OS with Web3 ownership, offering asset interoperability without the complexities of full decentralization.
INSIGHTS FROM OUR PORTFOLIO: THE INDUSTRY’S FUTURE
The AV Blockchain & Fintech Apex 20 reveals key industry trends.
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AI and Blockchain Integration
Companies are increasingly merging AI with blockchain tech to enhance scalability, privacy, and operational efficiency. This integration enables real-time data processing, decentralized AI models, and improved decision-making capabilities — setting the stage for more autonomous and secure systems. - Home
Decentralization Beyond Finance
While blockchain's origins are rooted in finance, its principles are now being applied to diverse sectors like social media, scientific research, and supply chain management. Decentralized platforms promote transparency, reduce reliance on intermediaries, and foster greater user sovereignty across industries. - Home
Regulatory Adaptation
As the crypto ecosystem matures, there's a growing emphasis on compliance, risk management, and regulatory frameworks. This shift reflects increased institutional adoption and a need for standardized practices that ensure security, build investor confidence, and facilitate global integration. - Home
User-Centric Innovation
A major trend is the rise of platforms designed to empower individuals with control over their personal data and digital assets. These solutions prioritize privacy, security, and user autonomy, reflecting a broader societal demand for ethical data management and self-sovereignty. - Home
Web2.5 as a Bridge
Hybrid models, often referred to as Web2.5, are emerging to bridge the gap between traditional Web2 experiences and the decentralized potential of Web3. By blending familiar user interfaces with the benefits of decentralization, these models reduce adoption barriers and accelerate mainstream acceptance of blockchain technologies.
20 Blockchain ventures from the Alumni Ventures portfolio that we’re excited about for 2025
These trends underscore the industry’s dynamic nature and the Blockchain & Fintech Fund’s agility in staying ahead of the curve.
INVESTING OVER TIME: THE POWER OF LONG-TERM EXPOSURE
At AV, we believe it’s not about timing the market but spending time in the market. As I’ve shown, the blockchain and fintech sectors evolve rapidly. While predicting the next viral breakthrough is nearly impossible, consistent investment across annual vintages ensures exposure to a diverse companies at the forefront of these shifts. This strategy increases the likelihood of participating in the next transformative wave in blockchain and fintech technology.
The AV Blockchain & Fintech Apex 20 highlights not just our proudest investments but also a roadmap for where the industry is heading. As we continue to support transformative ventures, our portfolio reflects AV’s commitment to driving the next wave of innovation in blockchain and fintech.
Jack Statza
Partner, AI and Blockchain FundsJack Statza brings deep-tech venture investing expertise across sectors and stages to his work at Alumni Ventures. He was previously an early-stage investor at Allstate Strategic Ventures, the venture capital arm of Allstate Insurance Company, primarily focusing on AI/ML, Blockchain, and Enterprise SaaS.
This communication is from Alumni Ventures, a for-profit venture capital company that is not affiliated with or endorsed by any school. It is not personalized advice, and AV only provides advice to its client funds. This communication is neither an offer to sell, nor a solicitation of an offer to purchase, any security. Such offers are made only pursuant to the formal offering documents for the fund(s) concerned, and describe significant risks and other material information that should be carefully considered before investing. For additional information, please see here. Example portfolio companies are provided for illustrative purposes only and are not necessarily indicative of any AV fund or the outcomes experienced by any investor. Example portfolio companies shown are not available to future investors, except potentially in the case of follow-on investments. Venture capital investing involves substantial risk, including risk of loss of all capital invested. This communication includes forward-looking statements, generally consisting of any statement pertaining to any issue other than historical fact, including without limitation predictions, financial projections, the anticipated results of the execution of any plan or strategy, the expectation or belief of the speaker, or other events or circumstances to exist in the future. Forward-looking statements are not representations of actual fact, depend on certain assumptions that may not be realized, and are not guaranteed to occur. Any forward-looking statements included in this communication speak only as of the date of the communication. AV and its affiliates disclaim any obligation to update, amend, or alter such forward-looking statements, whether due to subsequent events, new information, or otherwise.