Yet this trend isn’t new — it’s been building for years with the 345 investments these institutions have made in the space between 2020 and 2024. In the visual below, we’ve highlighted the G-SIBs’ blockchain investments from 2023-present:

Using CB Insights Business Graph data, and in partnership with Ripple and the UK Centre for Blockchain Technologies, we used CB Insights Business Graph data to power Banking on Digital Assets, a report that explores how banks have made global investments in the digital asset ecosystem over a five-year period.

Download the report for an inside look at how, where, and why banks are investing in blockchain technology and digital asset applications.

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AI continues to dominate, capturing 50% of venture investment. At the same time, investors are doubling down on hard tech — hardware-focused and capital-intensive technology — driven by surging energy demands from AI, advancements in robotics, and growing defense interest.

Below, we break down the top stories from this quarter’s report, including:

• Funding tops $90B for the third straight quarter, while deal count declines
• Hard tech claims 6 of the top 10 largest deals
• AI companies command funding premiums across sectors
• Regulatory shifts push big tech from M&A to minority investments
• CVC deals hit a 7-year low as the tariff threat looms

We also outline the categories shaping venture dealmaking for the rest of 2025 — including stablecoins, defense tech, quantum, and nuclear energy.

Let’s dive in.

Download the full report to access comprehensive data and charts on the evolving state of venture across sectors, geographies, and more.

Top stories in Q2’25

1. Funding tops $90B for the third straight quarter, while deal count declines

Venture funding reached $94.6B in Q2’25, marking the second-highest quarterly figure since Q2’22 and the third straight quarter to surpass $90B.

While funding dipped slightly from Q1’25, the decline reflects normalization after OpenAI’s $40B raise inflated numbers in Q1. In fact, Q2 remained elevated even as foundation model developers accounted for just 3% of total capital, down from 36% in Q1’25 and 29% in Q4’24. This shift signals a broadening of venture activity beyond foundation models into the broader AI ecosystem and adjacent hard tech sectors.

With this continued momentum, annual funding is projected to reach nearly $440B, a 53% increase from 2024, pointing to a sustained recovery in venture investment.

At the same time, deal volume continues to decline, reflecting greater investor selectivity. Q2 saw just 6,028 deals — the lowest quarterly total since Q4’16. This puts 2025 on pace for around 25,000 deals, or nearly half the volume seen in 2022, even as total funding approaches similar levels.

While investors are pulling back on the number of deals, they’re deploying more capital per investment: the median deal size hit a new high of $3.5M in 2025 YTD. Rising check sizes and falling deal count underscore a shift toward fewer, higher-conviction bets.

2. Hard tech claims 6 of the top 10 largest deals

Six of the 10 largest deals in Q2’25 went to hard tech companies, which are firms building capital-intensive physical products.

CBI customers: Track the highest funding startups in Q2’25

This surge is driven by macro forces such as onshoring initiatives, clean energy investment, and the rise of physical AI, which is enabling new capabilities across robotics, autonomy, and industrial systems.

Mega-rounds ($100M+ deals) spanned multiple sectors:

• Montera Infrastructure: $1.5B for hyperscale data center solutions
• Commonwealth Fusion Systems: $800M for commercial nuclear fusion
• Neuralink: $650M for brain-computer interfaces

Geopolitical tensions are also pushing capital toward defense, where startups are securing large rounds:

• World View: $2.6B for high-altitude aerospace platforms
• Anduril: $2.5B for autonomous defense systems and defense connectivity platforms
• Helsing: $693M for AI-powered defense applications

Across the board, defense tech startups are now commanding a median revenue multiple of 17.4x, edging out AI companies at 17.1x and all other major sectors. This signals high investor confidence and competition, driving premium valuations across the defense tech sector.

With investor appetite moving toward physical infrastructure and embodied AI, the rise of hard tech represents a shift likely to define the next chapter of venture investing.

3. AI companies command funding premiums across sectors

The venture market is experiencing a pronounced “AI premium,” with median deal size for AI companies reaching $4.6M in 2025 — over $1M more than the broader market. 

But the premium isn’t just financial. AI companies also score higher on CB Insights’ Mosaic Score (success probability) and Commercial Maturity (ability to compete and partner) across most sectors, signaling stronger fundamentals and market readiness in the eyes of investors.

AI companies in auto tech — with most focused on autonomous driving — are commanding the highest premium. Their median deal size is $20.6M higher than non-AI auto tech peers, and their average Mosaic score is 99 points greater. This quarter, the largest AI auto tech deal went to Applied Intuition, which raised a $600M Series F round at a $15B valuation.

Robotics and cybersecurity follow closely, with AI firms in those sectors securing median deal sizes $10.7M and $6.4M larger than their non-AI peers.

Team pedigree is further amplifying the premium. Thinking Machines Lab — founded by former OpenAI CTO Mira Murati alongside veterans from OpenAI, Google, Meta, and Mistral AI — raised a record-breaking $2B seed round at a $10B valuation, making it the most valuable seed-stage startup ever. 

The deal reflects an increasingly common “go big or go home” investing mentality, as investors make outsized bets on high-credibility AI teams.

4. Regulatory shifts push big tech from M&A to minority investments

Big tech M&A — which includes M&A from Alphabet, Amazon, Apple, Microsoft, Meta, and Nvidia — is entering a sustained downturn. Annual deal activity is projected to hit just 12 transactions in 2025, a steady decline from 66 deals in 2014. 

US regulatory tightening caused M&A activity to collapse from 30+ deals in 2022 to just 8 deals in 2023 — the steepest single-year decline on record.

CBI customers: Track big tech M&A activity

Big tech companies are adapting by taking large minority stakes, allowing them to circumvent federal antitrust review while still gaining strategic influence and access to key technologies. For example, Meta invested $14.8B in Scale — the largest funding round of Q2’25 — for a 49% stake, as did Microsoft with its recent investments in OpenAI. 

In 2025 YTD, big tech is on pace for 14 corporate minority deals, an increase from levels before the regulatory shift.

Big tech’s shift reflects broader M&A weakness across the market. Global activity has fallen 34% from 3,103 deals in Q1’22 to 2,053 deals in Q2’25, driven by high interest rates that have made financing more expensive and economic uncertainty that has made companies more cautious about acquisitions.

However, acquisitions of AI companies is one area where M&A is increasing. Activity reached record levels in Q2’25 at 177 deals — over double the 5-year quarterly average of 84 deals. This surge reflects companies’ need to acquire AI capabilities quickly rather than build them internally, as AI becomes essential for staying competitive.

While falling interest rates will help smaller deals rebound and provide a modest tailwind to overall M&A activity, we do not expect deal volumes to approach peak years. Big tech and other large corporations will remain constrained by regulatory scrutiny.

We are likely entering a new era where strategic partnerships and minority investments replace traditional M&A as a growth mechanism for major corporations.

5. CVC deals hit a 7-year low as the tariff threat looms

Corporate venture capital dealmaking has reached its lowest point in over 7 years, as CVC-backed investment totaled just $17B across 742 deals, down 8% quarter-over-quarter and representing the weakest performance since Q1’18.

CVC activity has fallen dramatically from its Q1’22 peak due to broader market pressures, including high interest rates and economic uncertainty. Tariff concerns are likely adding further burden to an already weakened market.

Despite fewer deals, median CVC-backed deal sizes have reached their highest levels since 2021. This suggests that CVCs are concentrating capital on fewer, higher-conviction investments.

CVCs are also collaborating more frequently. Deals involving 3+ CVCs reached a record high of 32% in Q2’25, reflecting both strategic necessity and market conditions: larger funding rounds in capital-intensive sectors like AI and hard tech may require multiple corporate partners to provide sufficient capital. At the same time, competition for access to the hottest technologies drives CVCs to team up rather than risk being shut out.

Breakout sectors of 2025

Below, we analyze venture funding across tech sectors to identify where investor conviction and market momentum are strongest.

Stablecoin funding is on pace to shatter its previous record

Stablecoin startups are experiencing an explosive year-over-year funding surge as stablecoins achieve mainstream adoption. Funding is projected to reach $10.2B in 2025, representing more than 10x growth from 2024.

Growing regulatory frameworks worldwide — such as the pending passage of stablecoin legislation in the US with bipartisan support — provide needed certainty for institutional investment, setting the foundation for exponential growth.

Multiple startups are taking advantage of the momentum. While the largest funding rounds occurred during the first quarter — with $2B deals for Avalon Labs and Binance — notable rounds also occurred during Q2’25, including:

• Flowdesk: $100M for digital asset trading and liquidity services
• Conduit: $36M for its cross-border business transactions platform
• Niural: $31M for an AI-enabled stablecoin and fiat payroll platform

Major financial services companies are also increasingly involved. Mastercard, Visa, and established banks are now enabling stablecoin transactions and issuing their own digital currencies, bringing institutional credibility to the space. Meanwhile, stablecoin issuers Circle and Ripple applied for banking licenses on June 30 and July 2, respectively, demonstrating their intent to operate like mainstream financial institutions.

Stablecoins are evolving beyond simple stores of value into yield-bearing tools and liquidity products. Solutions like liquidity mining, lending services, and yield-bearing stablecoins are receiving substantial investor attention. Cross-border payments companies powered by stablecoins are also gaining traction as affordable and accessible USD alternatives in emerging markets.

As regulatory frameworks solidify and institutional adoption accelerates, stablecoin companies are positioned to capture significant market share in global payments and financial infrastructure markets.

Defense tech momentum continues

Within the first two quarters of 2025, defense tech funding has already reached a new annual record of $11.1B.

The funding breakout is driven by multiple forces, including geopolitical instability and technology advancements, notably in drones and other unmanned vehicles.

Concurrently, the US Department of Defense is pushing to diversify the defense ecosystem through public-private partnerships and startup support.

The defense investor landscape is also rapidly evolving, with the number of unique investors in the space expected to increase 34% in 2025 to 950 from 710 the year prior. Traditional defense funds like Shield Capital and In-Q-Tel are now joined by generalist VCs, bringing more capital to fund a new generation of startups.

We expect continued investor interest in defense tech, as NATO recently agreed to increase defense spending from 2% to 5% of GDP by 2035, adding over $400B annually in market expansion. The 1.5% earmarked for security infrastructure aligns with venture trends in AI, cybersecurity, robotics, and technologies developed for both military and civilian use cases.

Quantum tech reaches an all-time high, halfway through the year

Quantum tech is attracting significant investor interest, reaching record annual funding levels at $2.2B within the first two quarters of 2025 — an increase of 69% from 2024.

The surge follows major hardware breakthroughs from Google, IBM, and Microsoft, which may drive confidence in leading startups even though the technology still lacks practical applications that outperform classical systems. Industry leaders like Fujitsu and Quantinuum — a subsidiary of Honeywell — expect fault-tolerant quantum computers by 2030 at the earliest.

Massive investments are flowing towards various quantum applications in 2025 so far:

• PsiQuantum: $750M to build million-qubit photonic quantum computers by 2029
• QuEra Computing: $230M to accelerate fault-tolerant neutral-atom quantum systems
• Multiverse Computing: $215M to scale its quantum-inspired AI compression technology

Government support has also increased, with $1.8B in public funding announced globally in 2024. For example, Australia committed $620M to PsiQuantum, while DARPA committed up to $200M in joint funding to assess the feasibility of industrially useful quantum computers.

As quantum technologies move toward commercial viability, the combination of record private investment, substantial government backing, and technical progress positions the industry for significant growth once practical quantum advantage is achieved in commercial applications.

Corporate interest drives a surge in nuclear energy funding

Funding to nuclear energy companies is projected to reach an annual record by the end of 2025 at $5B. Massive energy requirements for AI data centers — with US data center power consumption projected to triple by 2030 — are driving corporate interest in clean baseload power.

Big tech companies are leading the charge, with investments since 2024 across both small modular reactors (SMRs) and fusion technologies:

• Amazon invested in X-energy with plans to develop over 5 GW of SMR projects by 2039; Amazon also backed Realta Fusion
• Google reached agreements with Kairos Power for up to 500 MW of nuclear power by 2030 and has also invested in Commonwealth Fusion Systems and TAE Technologies.
• Microsoft reached a deal with Constellation Energy to reopen the Three Mile Island nuclear plant, while committing to purchasing fusion electricity from Helion Energy by 2028

Corporate interest has also skyrocketed, with earnings call mentions hitting record levels as executives grapple with the major power requirements for AI infrastructure.

Current and previous presidential administrations have reduced regulatory red tape for nuclear development, streamlining approval processes. The bipartisan approach creates stable regulatory support for long-term investments and should accelerate sector growth in the coming years.

As AI adoption continues, nuclear provides the only scalable solution for clean baseload power that intermittent renewables cannot match for always-on AI computing infrastructure. The combination of massive corporate demand and supportive regulatory frameworks positions nuclear for explosive growth in the years ahead.

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RELATED RESOURCES FROM CB INSIGHTS:

• State of Venture Q1’25 Report
• The AI agent market map
• 7 tech M&A predictions for 2025
• State of AI Report: 6 trends shaping the landscape in 2025
• 15 tech trends to watch closely in 2025

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In partnership with Stablecon, CB Insights has created a market map to help enterprises and investors identify high-growth markets and companies within the stablecoin ecosystem. 

After analyzing 600+ companies, we selected 172 recently funded players that demonstrate strong momentum — as measured by CB Insights’ Mosaic score, which assesses private-company health and growth potential based on funding data, personnel, market strength, and online sentiment. We then mapped these companies across 8 categories based on their primary focus.

Please click to enlarge.

CBI customers: Get data on 400+ stablecoin companies in the Expert Collection

Key takeaways

1. Stablecoins are laying the foundation for a new era of crypto-native banking

Stablecoins are solving a key obstacle to cryptocurrency adoption: volatility. Unlike traditional cryptocurrencies, stablecoins maintain consistent value through ties to underlying assets.

This stability has attracted major players in traditional finance: Mastercard and Visa now enable stablecoin transactions, while established banks Societe Generale and Vantage Bank have begun issuing their own stablecoins. Established blockchain infrastructure providers like Zero Hash and Fireblocks (founded in 2017 and 2018, respectively) are facilitating this mainstream adoption by providing technology geared toward enabling traditional financial institutions to integrate stablecoin capabilities.

Wallets & custodial solutions have experienced the highest average headcount growth (83%) of any market map segment over the past year. Examples include Littio and Open Settlements, which offer custodial services that store and manage stablecoins on behalf of consumers while providing traditional banking features like payments and transfers. Another notable player is KAST, a stablecoin account provider that has increased its headcount by 10x YoY (to more than 40 employees) and secured $10M in funding in December 2024. KAST offers cards compatible with Apple Pay, Google Pay, and ATMs, and recently announced plans to evolve into a full-fledged on-chain bank.

Stablecoin issuers are also developing innovative approaches to address the limitations of USD-pegged stablecoins, such as Ampleforth’s cost-of-living-indexed stablecoins that adjust for inflation and Ethena’s synthetic stablecoins that don’t require traditional banking reserves. Stablecoin issuers represent the largest category on the market map by number of companies and have the highest average M&A probability (24%) among segments. This signals high consolidation potential as the market matures and highlights the strategic value of stablecoin issuance to established financial players.

2. Liquidity & yield use cases are transforming stablecoins from passive stores of value into high-growth financial instruments

Stablecoins are evolving into yield-bearing tools and liquidity products, expanding beyond their traditional role as safer alternatives to high-risk cryptocurrencies. For example, established stablecoin issuer Paxos recently introduced a yield-bearing stablecoin, Lift Dollar (USDL). And following its $1.1B acquisition of Bridge last fall, Stripe added payment capabilities for Bridge’s USDB stablecoin, which generates yield through backing by BlackRock money market funds.

The liquidity & yield category, which includes liquidity mining, lending services, and yield-bearing stablecoins, has attracted $2.3B in funding across 40 deals over the last 12 months — the most funding of any category. Although $2B of this was a flexible, scalable credit line for institutional crypto lender and stablecoin issuer Avalon Labs, the funding intensity signals strong investor interest in this nascent category — the liquidity & yield category has the lowest Commercial Maturity score of all markets, with companies averaging Level 2: Validating (i.e., introducing their products to the market through validation and testing).

The category’s growth potential is best exemplified by StakeStone, a cross-chain liquidity protocol that has secured 7 funding rounds since early 2024, while more than doubling its Mosaic score in just over 6 months (from 444 in November 2024 to over 900 in May 2025).

3. Cross-border payments are becoming the breakout use case for stablecoins, especially outside the US

International payments have emerged as a crucial application for stablecoins, with every company in the payments processing category supporting cross-border payments infrastructure. The role of stablecoins varies by region: in countries with robust traditional banking, they serve as specialized alternatives to fiat currency for specific use cases, while they provide more affordable and accessible USD alternatives in emerging markets.

This global appeal is reflected in investment patterns — among companies included in this market map, those based outside the US attracted more than half of all deals in the past 12 months. Major payment companies such as Mastercard, Visa, and Stripe have also entered this space through stablecoin card payments, transaction settlement, and analytics projects. This entry by established payment giants signals mainstream validation of stablecoin infrastructure and suggests that digital currency payments are moving from experimental to essential for competitive positioning in global payments.

The payments processing segment is relatively early in its commercial development, with half of the companies in this category still in the first 2 levels of Commercial Maturity (developing or piloting their products). However, these companies demonstrate significant growth potential — based on CB Insights’ estimates, we expect them to receive $454M in funding in 2025. That’s more than 10x the $45M they received in 2024, when excluding Stripe’s $694M round (the payments processor had not yet launched stablecoin payments at that point).

Market descriptions

Mosaic scores are dynamic and subject to change. Mosaic scores as of May 2025.

Analytics & monitoring

Platforms, tools, and services that track, analyze, and provide insights into stablecoin operations, transactions, and market behaviors. These solutions help users, regulators, and stakeholders understand stablecoin performance, ensure compliance, manage risk, and make data-driven decisions.

• Total funding within last 12 months: $18M
• Total deals within last 12 months: 4
• Top companies by Mosaic:
  • Chainalysis (861 Mosaic): Transaction monitoring and risk intelligence for blockchain companies
  • Elliptic (773 Mosaic): Transaction monitoring and analytics for stablecoin issuers
  • Coin Metrics (713 Mosaic): Blockchain data and analytics, including dedicated stablecoin coverage

Blockchain infrastructure

Fundamental technological layers, networks, and services that enable stablecoins to operate effectively across multiple blockchain environments. These infrastructure providers deliver the essential technical foundation upon which stablecoin systems are built, operated, and scaled.

The companies in this category offer critical components of the technical stack required for stablecoins to function effectively, including layer-1 blockchains, oracle networks, cross-chain messaging protocols, scaling solutions, and developer tools.

• Total funding within last 12 months: $51M
• Total deals within last 12 months: 10
• Top companies by Mosaic:
  • Securitize (917 Mosaic): Digital securities issuance platform for tokenization of assets, including the frxUSD stablecoin in partnership with Frax
  • Aptos Labs (866 Mosaic): Layer-1 blockchain which supports Circle’s Cross-Chain Transfer Protocol and USDC on-ramp services via Stripe
  • TON (851 Mosaic): Layer-1 blockchain which supports stablecoin payments

Enterprise & B2B

These platforms, services, and solutions are specifically designed for businesses to integrate, manage, and use stablecoins within their financial operations. They frequently support use cases such as B2B payments, payroll, treasury operations, and customer-facing payment options, while managing the associated regulatory, accounting, and operational requirements.

• Total funding within last 12 months: $125M
• Total deals within last 12 months: 15
• Top companies by Mosaic:
  • BVNK (844 Mosaic): B2B and B2C stablecoin payments infrastructure including an embedded wallet for cross-border fiat and stablecoin transactions
  • OwlTing (832 Mosaic): Its OwlPay solution includes wallet and fiat conversion services geared towards B2B stablecoin transactions
  • Rise (803 Mosaic): A cross-border fiat and stablecoin payroll solution

Exchanges/On & off ramps

Platforms and services that facilitate the conversion between stablecoins and other assets, including fiat currencies (e.g., USD, EUR) and other cryptocurrencies. These services provide the essential bridge between traditional financial systems and the stablecoin ecosystem.

The companies in this category include both centralized exchanges with stablecoin support and specialized on/off-ramp services designed to make it easier for users to enter and exit the stablecoin ecosystem across different regions and payment methods.

• Total funding within last 12 months: $2.3B
• Total deals within last 12 months: 9
• Top companies by Mosaic:
  • Binance (931 Mosaic): Crypto exchange which recently entered a strategic partnership with Circle, expanding USDC availability to consumers and adopting USDC for its corporate treasury; received a historic $2B investment in the form of stablecoin from MGX earlier this year
  • MoonPay (895 Mosaic): On- and off-ramp and crypto payments solution that recently partnered with Mastercard to enable stablecoin payments via its recent acquisition of Iron (APIs for stablecoin infrastructure)
  • Klickl (849 Mosaic): Crypto and stablecoin infrastructure including exchange, custody, payments, and off-ramp services

Issuers

Organizations and protocols that create, distribute, and manage stablecoins. These issuers are responsible for the provision and ongoing operations of stablecoins in the market.

The companies in this category represent diverse approaches to stablecoin issuance, including fiat-backed stablecoins, crypto-collateralized stablecoins, algorithmic stablecoins, and regional currency stablecoins, each with their own mechanisms for maintaining stability and addressing specific market needs.

• Total funding within last 12 months: $279M
• Total deals within last 12 months: 36
• Top companies by Mosaic:
  • Ripple (905 Mosaic): Established blockchain infrastructure provider that launched the RLUSD stablecoin in December 2024 and introduced it into cross-border payments in 2025 
  • Circle (903 Mosaic): Issuer of the USDC and EURC stablecoins, recently introducing a stablecoin orchestration layer for global payments
  • World Liberty Financial (871 Mosaic): Issuer of the USD1 stablecoin introduced in March 2025, which is the currency of choice for MGX’s $2B investment in Binance

Liquidity & yield

Platforms, protocols, and services that enable users to deploy stablecoins productively to earn returns, provide market liquidity, or access lending/borrowing capabilities. These solutions transform stablecoins from purely transactional instruments into yield-generating assets.

Providers range from those focused on capital preservation to more aggressive yield-seeking methods, catering to different risk appetites within the stablecoin ecosystem.

• Total funding within last 12 months: $2.3B
• Total deals within last 12 months: 40
• Top companies by Mosaic:
  • StakeStone (918 Mosaic): Cross-chain liquidity protocol which recently partnered with World Liberty Financial to support USD1
  • Flowdesk (834 Mosaic): Market maker providing trading infrastructure, recently appointed to provide liquidity for Societe Generale’s EURCV stablecoin
  • Ethena (830 Mosaic): Its synthetic stablecoin USDe, backed by other cryptocurrencies, offers greater opportunities for staking/yield generation than a fiat-backed stablecoin

Payments processing

Platforms and infrastructure that facilitate the use of stablecoins for everyday commercial and personal transactions. These solutions enable businesses and individuals to send, receive, and process stablecoin payments efficiently and securely.

• Total funding within last 12 months: $187M
• Total deals within last 12 months: 23
• Top companies by Mosaic:
  • Stripe (929 Mosaic): Payments processor that recently rolled out stablecoin business accounts across 100 countries and partnered with Ramp on stablecoin-based corporate cards
  • Rain (857 Mosaic): Card issuance and payments platform for stablecoin transactions
  • Mesh (854 Mosaic): Crypto payments network that recently introduced crypto-to-stablecoin retail payments via Apple Pay

Wallets & custodians

Applications, platforms, and services that enable users to securely store, manage, and transact with stablecoins. These solutions range from self-custody wallets where users control their private keys to custodial services where providers manage crypto assets on behalf of users.

Approaches to stablecoin management range from hardware wallets and mobile applications for individual users to sophisticated custodial infrastructure for enterprise clients.

• Total funding within last 12 months: $237M
• Total deals within last 12 months: 19
• Top companies by Mosaic:
  • Fireblocks (912 Mosaic): Its blockchain solutions include custodial white-labeled wallets, and it recently partnered with Chainlink Labs to create a stablecoin solution for banks
  • Phantom (901 Mosaic): Multichain wallet supporting cryptocurrencies including stablecoins
  • BitGo (899 Mosaic): Offers custodial solutions, including stablecoin reserve assets management for USD1, and has stated intent to launch a stablecoin of its own

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We’ve used generative AI, combined with our proprietary data on these companies and their markets, to create the following scouting reports — in just one click on CB Insights.

Download the book to see all 40+ scouting reports. And stay tuned for our upcoming Stablecoin market map, which we’ll unveil live at Stablecon on May 29.

CB Insights customers can download the book using the left-hand sidebar.

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But AI and blockchain solutions are driving innovation to create new revenue streams and stoke the existing ones. Early-stage deals in those spaces helped drive a rally in funding and dealmaking in gaming in 2024. Annual funding nearly tripled to $3.2B across 317 deals, with early-stage companies securing 77% of investments — up from 70% in 2023. 

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Our 2025 Tech Trends report provides a concrete roadmap for corporate leaders to navigate some of the most important technology shifts in the year ahead.

We include specific recommendations for action so that business leaders can get ahead of the next wave of value creation.

Here is a selection of key findings from the report:

• AI agents are given money to spend: AI agents’ utility is limited until they can make transactions seamlessly. A small group of tech players is building new infrastructure to make that happen.
• The future data center arrives: With data center power usage expected to more than double by 2026, big tech companies are morphing into energy innovators to support AI workloads. There’s a huge opportunity in improving data centers’ energy efficiency.
• Investment floodgates open for RNA therapeutics: RNA therapeutics developers are pioneering new ways to treat traditionally “undruggable” diseases, with a growing focus on neurodegenerative disorders like Alzheimer’s and Huntington’s diseases.
• AI M&A fuels the next wave of corporate strategy: AI’s share of corporate tech M&A has doubled since 2020. Tech incumbents like Nvidia, Salesforce, and Snowflake, as well as consultancies like Accenture, are rapidly acquiring AI startups to tap into enterprise demand. 
• Disease management enters a new phase with AI: AI is improving care delivery across 3 key areas of disease management: precise symptom evaluation; testing/screening for earlier disease detection (including before symptoms even appear); and finding at-risk individuals in datasets of entire patient populations. 
• Retail’s personalization imperative: Generative AI is unlocking 1:1 experiences across commerce touchpoints, with leaders like Target seeing a corresponding 3x boost in conversation rates. Personalization will become omnipresent in retailers’ offerings.
• And much more

Methodology

Our analysis relies on a wide range of CB Insights datasets, including financing and acquisition data, valuations, founding team and key people data, earnings transcripts, and more. We also leverage CB Insights’ proprietary scoring algorithms to measure business health (Mosaic) and maturity (Commercial Maturity), as well as the likelihood of acquisition (M&A Probability score). Throughout the report, we provide CB Insights customers with jumping-off points to dig deeper into the data behind the report.

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What you need to know:

• The 9 new fintech unicorns of H1’24 showcase: global diversification away from the US, a focus on B2B offerings, continued interest in blockchain/crypto despite commercial immaturity, and growing traction in CFO-oriented technologies.
• Overall, new fintech unicorn creation has dramatically slowed, with only 2 emerging in Q2’24 compared to 49 in Q2’21, reflecting a shift from venture’s previous “growth-at-all-costs” mentality.

New fintech unicorns (startups valued at $1B+) have become rare.

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Crypto prices are on the rise. Reported fraud in the market is declining. Some notable players in digital currencies are even going public.

Investors’ and finance leaders’ interest in crypto has also started to return. Executives across industries are talking about crypto again — mentions of terms related to digital currencies are back at levels prior to the crypto winter that began in 2022.

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Humans will still play a crucial role — but instead of assembling parts or operating machinery, they will maintain robots and keep them running.

In these future factories, robots coordinate in unison, completing work automatically — without breaks, every hour of the day — to get products out the door. 

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The impact on the pharma industry has been substantial, with Ozempic’s producer, Novo Nordisk, seeing a 36% rise in sales in 2023 driven by the accelerated adoption of its GLP-1 products. D2C pharmacies like Hims are also entering the space, offering their own GLP-1 drugs at a fraction of the cost to patients. 

The rapid growth in prescriptions for these appetite-curbing drugs has drawn wide-spread attention from corporates across industries.  

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But when it comes to leaders’ investments and partnerships, cross-border payments expansion and digital wallet integration continue to dominate. 

A newer focus has also emerged: crypto. Though not discussed in their earnings calls, payments leaders are reengaging with digital currencies after pulling back in recent years.

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While this has created a new level of accessibility for consumers, it has also led to spikes in drug shortages and counterfeit medicines. 

To combat these public health risks, regulations have been put in place to promote pharma supply chain traceability and safety. For example, the FDA announced that players along the supply chain must meet new Drug Supply Chain Security Act (DSCSA) standards by the end of 2024. This will require companies throughout the value chain to maintain and share electronic documentation regarding the chain of ownership for their products.

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While the sportswear leader’s focus on direct sales channels helped it amass a sizable digital loyalty program, it wasn’t enough to compensate for the loss of third-party retail customers and the cost of running its own D2C business.

Now, the brand is developing cost-cutting plans, returning to e-commerce marketplaces, and working to grow its NikePlus loyalty program — where members spend significantly more than the average customer.

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Startup valuations jumped for AI companies in 2023. Big tech is reaching new heights — as well as facing intensifying competition. Corporates are feeling the pressure to build their AI strategies and stay ahead of their peers.

At the same time, enterprises and investors have become more cautious spenders. Venture funding fell to a 6-year low in 2023. Many tech spaces will contend with consolidation in the year ahead, from digital therapeutics to cybersecurity.

Nevertheless, even with limited access to capital, startups continue to make commercial breakthroughs in areas like quantum computing, neurotech, and robotics.

We used the CB Insights technology intelligence platform to cut through the noise and identify 20 under-the-radar trends that will define tech in 2024. We analyzed signals like tech company financings, executive chatter in earnings transcripts, business relationships, customer perspectives, patents, and more.

Our 129-page report digs into trends across major industries including:

• AI
  • GPU shortage forces companies to be smarter
  • Multimodal AI will rise on corporates’ wish lists
  • Synthetic data bonanza
• Enterprise
  • DIY software development upends engineering orgs
  • Global employment & payroll market shakes out
  • Quantum computing advances hint at faster commercialization
• Cybersecurity
  • Cyber chaos drives security consolidation
  • AI vs. AI dogfights redefine data security
• Healthcare & life sciences
  • The great AI drug race heats up
  • Digital therapeutics (DTx) & wellness consolidates
  • The brain becomes a fierce tech battleground
• Financial services & insurance
  • Banks get AI FOMO
  • Blockchain’s uphill finserv battle
  • Extreme weather is an opportunity for insurtech
• Retail & consumer
  • AI sales agents flood the e-commerce landscape
  • Retailers tackle shrink with AI loss prevention
  • AI sends a shockwave through gaming
• Industrials
  • Humanoid robots come for manufacturing
• Venture
  • Corporate venture refocuses on strategic fit
  • Unicorns need a new playbook to survive

Download the full report to see all 20 trends and identify disruptive tech markets, how incumbents are preparing, and the startups vying to change industries.

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Caitlin Barnett, Director of Regulation and Compliance at Chainalysis is joined by executives from Fireblocks, LexisNexis, Hummingbird, and Notabene to discuss how compliance departments can implement risk-based procedures and navigate the fast-paced regulatory landscape.

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LVMH’s strategic focus on targeting millennials and Gen Z — which are expected to account for 70% of luxury spending by 2025 — may be a key factor to its continued growth.

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In what’s been more than a decade of disruptive projects and front page news headlines, regulators and institutions have sought a deeper understanding of these decentralized and often anonymous blockchain networks.

As a result, the cryptocurrency ecosystem has been subject to many unfounded or antiquated perceptions from financial institutions, regulators, and broader enterprises. The absence of centralized verification opened the door for third-parties to make sense of unstructured data and identify its counterparties.

Chainalysis, a blockchain data solutions provider, offers a bridge between crypto companies, regulators, financial institutions, and law enforcement.

Their solutions have become a cornerstone to the compliance programs of businesses involved in cryptocurrency markets to various extents, ranging from direct market involvement such as America’s oldest bank, BNY Mellon, offering custody of digital assets; to less involved financial institutions with private wealth contingents that source crypto derived capital, or capital markets teams seeking to take cryptocurrency businesses public.

As a critical piece of the evolving blockchain ecosystem, Chainalysis’ team has dedicated significant time addressing prevailing myths and demonstrating the value of blockchain technology.

“When I first visited BNY Mellon in 2017, I truly think they thought I was up to no good,” says

Jeffrey Billingham, the Director of Strategic Initiatives at Chainalysis. “Five years later they’re a customer of ours and going into crypto custody.”

Continuing this effort, Chainalysis recently published its Crypto Myth Busting Report, tackling 40+ crypto myths held by compliance officers and investors alike when considering further integration of blockchain technology and its regulatory outlook.

“In reality, most concerns that prevent institutional involvement are either superfluous, or there are ways to build programs that address these challenges. There is a way for institutions to get involved,” says Jeffery. “Many would also argue that the current market trough is the best opportunity to do so. Oftentimes, crypto winters are when building programs and educating teams and compliance colleagues can set the stage for legitimate applications within the ecosystem.”

We sat down with Jeffery to discuss how Chainalysis’ data, and the ecosystem’s progress as a whole, is shedding light on crypto’s security and legitimacy and further clarifying its real world applications.

Crypto blockchain’s vs. tradition finance: visibility, security, and compliance

The report includes myths around the legal and security implications of decentralized networks and the risks they pose to, for example, KYC compliance.

These myths include:

• Crypto is anonymous and untraceable.
• There’s no way to prevent criminals from using Crypto.
• Crypto enables tax evaders.
• Miners could alter Bitcoin’s properties for their own gain.
• There’s no way to guard against hacks.

“Satoshi Nakamoto’s Bitcoin whitepaper contrasted the potential privacy of Bitcoin with that of bank transactions, while outlining a vision for cryptocurrency’s traceability. Bitcoin was never meant to be and has never been untraceable,” Chainalysis says in the report. Since 2013, further KYC regulations have been applied to cryptocurrency that ensure crypto-to-fiat transactions aren’t anonymous.

Blockchain architecture offers complete visibility so that every transaction is verified and viewable in an immutable public ledger. This transparency enhances the security of cryptocurrency for businesses, whether industry natives or traditional financial institutions looking to provide crypto offerings. Compliance teams can trace the origins of cryptocurrency to ensure they’re coming from a clean source, thereby enhancing their anti-money laundering efforts.

“There’s a huge degree of trust and transparency available for every blockchain with data service providers like Chainalysis,” says Jeffery. “We help regulators, institutions, and law enforcement understand all of the counterparts in the marketplace and the actual operating counterparties on otherwise anonymous transactions.”

This full cycle visibility has enabled Chainalysis to work with many parties to maintain compliance and mitigate risk. The process has helped prove that 1.) criminal uses on blockchains are rare and declining, and 2.) that coordination between law enforcement and blockchain analysis tools can effectively track criminal activity to recover stolen funds and identify illicit activity.

Above: Chainalysis’ 2023 Crypto Crime Report shows that crypto crime represented less than 1% of overall transition volume in 2022.

For ensuring AML compliance, data solutions on top of immutable blockchain networks are able to track transactions from source to deposit.

Blockchain analytics have speculated around how many hops – or intermediary wallet transfers between source to destination – are needed between dangerous intermediary wallets to determine that a wallet is safe.

“This question comes up frequently with banks because they want some sort of standardization, but setting standards at any number of hops is conceptually irrelevant when the purpose is understanding the ultimate source of the money,” says Jeffery.

“You can’t have a compliance officer left in a scenario where crypto currency was moved through hundreds of wallets over an hour with no ability to view further, or where money was moved twice in the last four years and an alarm is set off. It depends on the scenario, whether it’s a money laundering case, a fraud incident, an account compromise, or a larger financial terror network. We’re not limited by the number of hops, and showing the path from source to deposit that’s a huge insight when you’re looking to uncover and prevent money laundering or illicit activity.”

Chainalysis calculates every blockchain entity’s indirect exposure to illicit activity, or funds received from or sent to illicit addresses regardless of the number of non-service addresses in between.

The data solutions visibility and trust allowance extends well beyond AML compliance.

“When our data can show transactions are coming from this exchange, miner or payment processor, that’s a different conversation than just flagging if transactions came from a sanctioned entity or a scam site,” says Jeffery.

Regarding concerns for tax evasion, blockchain transparency prevents hiding transactions, and users are required to report crypto transactions on tax returns. The primary way that crypto differs from fiat is that the IRS treats digital assets like property when assessing taxable gains or losses.

The blockchain’s immutable ledger is safer than some would believe, and security across the larger ecosystem is continually improving.

Attacks that compromise blockchains are another common fear. A 51% attack involves a single party controlling a majority of the blockchain, after which they could change the order of transaction processes, reverse unprocessed transactions to ‘double-spend’, and prevent the completion of new verification blocks.

Yet, a 51% attack has never occurred on a major blockchain, and such occurrences are increasingly difficult as network communities grow. The hashing power to maintain a blockchain is directly correlated with its size, making the power needed to do so inhibitively large. The alignment of economic incentives across all parties, especially on a major blockchain, is further risk mitigation.

The broader crypto ecosystem has been steadfast on improving security.

In the early days of the internet, prevailing wisdom said to never enter your credit card data on a website. Once SSL encryption technology came around and reputable payment gateways were established, e-commerce began to proliferate.

Cryptocurrency adoption is following a similar dynamic, where security safeguards are being solved over time, in pursuit of cutting edge applications for the technology.

In just the last few years, improvements have reduced hacking frequency on major exchanges, and the majority of security threats are occurring on newer, unrefined technologies such as cross-chain bridges, or DeFi apps that port cryptocurrency across blockchains.

Above: Chainalysis’ 2023 Crime report shows volumes of cryptocurrency theft by platform

This new technology is more vulnerable than centralized services or wallets, but innovators are racing to improve its security. Chainalysis recently partnered with blockchain security firm Halborn to provide DeFi code audits for identifying and fixing vulnerabilities. Cryptocurrency security is increasing as the industry’s cumulative experience and adoption grows. Chainalysis sees this to be a persistent trend.

Regulation and Compliance: crypto companies and services

The Myth Busting report addresses myths surrounding risks associated with interactions with cryptocurrencies, and their regulatory oversight (or lack thereof).

These myths include:

• Crypto is completely unregulated.
• All cryptocurrency businesses are risky, and therefore banks can’t interact with them.
• It’s impossible for banks to know what crypto companies do with their crypto holdings.

The 1970 Bank Secrecy Act required all money services businesses (MSB) to implement Know Your Customer (KYC) and anti-money laundering (AML) programs.

All cryptocurrency businesses — such as exchanges, ATMs, brokers, custody providers, and more — needed to register as MSBs comply with BSA requirements since 2013, when the Financial Crimes Enforcement Network (FinCEN) considered “persons creating, obtaining, distributing, exchanging, accepting, or transmitting virtual currencies” as MSBs.

“There’s a lot of guidance that exists from the Department of Financial Services (DFS), the Treasury, the OCC , the SEC, and CFTC in terms of the KYC guidance, rules and requirements to comply with based on what you’re buying and selling,” says Jeffery.

“In most cases, the historical data points to the fact that problematic cryptocurrencies companies weren’t able to meet requirements that are already on the books today. FTX is a shining example of this.”

When supported by improving regulatory clarity and third party transparency, the inherent transparency of blockchains makes many of the risks associated with financial services more visible than with fiat. Crypto is the only asset class whereevery business transaction is viewable in real time.

As an example, crypto companies are beginning to publish proof-of-reserves, or third party verification audits that the equivalent value of client accounts are held in covered client assets.

Integrating Crypto into traditional financial services while meeting risk management standards is increasingly feasible. Chainalysis provides a Crypto Maturity Model for banks that are considering cryptocurrency adoption that steps in the process ranging from risk mitigation for KYC, AML/TL, sanctions, fraud, and compliance; to assessing customer interaction with in-depth on-chain metrics tools like Kryptos. They’ve used this model to support banks when taking on cryptocurrency businesses as clients, advising cryptocurrency businesses on IPOs and mergers and acquisitions, providing foreign exchange services, and offering synthetic cryptocurrency products or enabling deposits.

U.S. Regulatory Apathy: Crypto’s co-existence with the Financial System

“When you look at jurisdictions like Brazil, Singapore, and the European Union, there is no question that the US is lagging behind,” says Jeffery.

“Regulators around the globe are realizing the opportunity they have to utilize the blockchain’s inherent transparency to revolutionize the way they supervise markets and enforcement regulations. At Chainalysis, our policy team works with regulators around the world to demonstrate the art of the possible that comes with this technology. That approach is no different in the US.”

Jeffrey believes two myths in particular are contributing to current regulation trends and weighing on U.S. regulators’ minds:

• Crypto companies don’t want to comply
• Achieving consumer protection is best done through banning cryptocurrency and digital assets.

“The overwhelming majority of digital asset players want to be compliant and safe for consumers,” he says. “However, to do just that, they need clear regulatory guidelines that take into account the specifics of the underlying technology, and offer the certainty needed for further investment. We see digital asset firms’ deep investment in tools like Chainalysis as proof of this, and we’re constantly working with businesses to tamp down on illicit activity and take criminals to task.”

Blockchain data solutions and cryptocurrency companies have a role in facilitating progress.

“Agencies are in need of data sources that help them understand the difference between Bitcoin and Etheruem, or Bitocion and Stable Coins. And they’re relying on business to do well and explain their case and provide the data that helps them learn, educate and understand internally. There’s a huge education curve for regulators around this,” says Jeffery.

In tandem, frivolous and overly restrictive proposals in lieu of organized guidelines are harming U.S. competitiveness and progress towards many promising use cases.

“Our data at Chainalysis on the banning of cryptocurrency — things that countries such as Egypt and China have done — don’t work. In places with bans and without bans, consumers continue to enter the market,” says Jeffrey.

“U.S.-based firms are increasingly debating whether they should relocate to other jurisdictions where clear regulatory guidance exists. This harms U.S. consumers by limiting the market options available to them, and also by potentially pushing a revolutionary technology outside the bounds of U.S. law. Therefore, a comprehensive regulatory framework is the only sustainable path forward – if the goal is to actually achieve consumer protection.”

Recent actions by the U.S. government may improve clarity as focus turns toward digital currencies.

“Since 2022, the U.S. House of Representatives has been working on legislation that would improve regulatory clarity. The Chairmen of the House Financial Services Committee and House Agriculture Committee have recently released a joint discussion draft of legislation providing a statutory framework for digital asset regulation,” says Chainalysis in the report.

Maturing regulation outside the U.S. is moving faster. The inter-governmental Financial Action Task Force (FATF) is leading the establishment of global standards for rulemaking amongst participating countries. The EU parliament passed the first comprehensive legislation in its region for regulating digital assets, in April 2023. The Atlantic Council’s interactive map offers details for global progress.

As global regulators expedite their efforts to address cryptocurrencies and blockchain, misconceptions about the feasibility of a co-existential relationship between traditional financial systems and blockchain technology persist.

These myths include:

• Crypto can’t integrate with traditional finance.
• There’s only downside for governments integrating crypto into the financial system.
• CBDCs will make existing crypto obsolete.

In October 2022, America’s oldest financial institution, BNY Mellon, became the first large bank to custody cryptocurrency. In a global survey BNY Mellon commissioned of institutional asset managers, asset owners, and hedge funds, it found that 88% of institutional investors were still moving ahead with plans to adopt digital assets despite crypto winter, and 72% were seeking providers to support these needs.

Governments developing crypto literacy can reap benefits within their financial systems. Its traceability improves abilities for tracking criminal activity, recovering illegal gains, and using sanctions to prevent crime.

This potential has spurred a rush of research around the implementation of central bank digital currencies (CBDCs) to improve transaction processing, remittances, cross-border payments, and protect national security. CBDCs combine the benefits of fiat and crypto currency by putting national securities on a blockchain.

In March of 2022, President Biden signed an Executive Order on Ensuring Responsible Development of Digital Assets with the objective of expanding U.S. leadership on CBDC research and development.

These developments sparked speculation that the implementation of CBDCs could render current cryptocurrencies obsolete.

However, these speculations overlook some of the foundation goals of cryptocurrencies that differentiate them from national currencies, whether or not they are stored on the blockchain. Bitcoin for example, was invented and purposed as an asset class and store of value that shields users from monetary policy risks and inflation.

CBDCs would be a huge innovation in terms of the method by which a central bank delivers its asset, but it’s the same asset going from paper to digital. This is a very different proposition than an asset that was built by a white paper and community with a protocol that exists based on an agreement with all participants in that network. In that sense, CBDCs and crypto coexist, they don’t replace one another,” says Jeffery.

“There are many distinct considerations and risks for CBDCs,” he adds. “Our commercial banking infrastructure is in large part due to the central bank not wanting, or its inability to, keep records on the paper trail for hundreds of millions of citizens. We depend on commercial banks to do that work, and whether we should rely on CDBS to do that work is a question still being explored.

Real World Use Cases and Applications: a multifaceted ecosystem

Finally, the MYTH BUSTING REPORT addresses fallacies surrounding the numerous opportunities for blockchain, well beyond acting as a store of value and ledger.

These myths include:

• Crypto has no real-world use case.
• Blockchain doesn’t scale.
• All cryptocurrencies are alike.
• Blockchains have no business application.

“The myth that crypto has no real world use case tends to be founded on the assumption that it’s ‘crypto or nothing’. Cryptocurrency exists alongside central bank currency, gold and precious metals, commodities, equities, and rates products. These are all options for managing a diverse and conservative portfolio,” says Jeffery.

“It’s a diversifying asset that has been at work for over a decade, that operates on a network of rules separate from central banks, with supply growth that’s determined by a protocol and a community. It’s no better or worse, only different than the money in our pockets.”

Numerous examples of real world applications for crypto already include remittance, inflation mitigation, and retail purchasing.

Faster and less expensive than wire transfers, cryptocurrency is being leveraged to transfer money across borders and overseas. Over $56 million in crypto donations have been sent to Ukraine within the last year, and $5.9 million was sent to the victims in need within a month of the Turkey and Syria earthquake on February 6th.

In the 2022 Geography of Cryptocurrency Report, Chainalysis found that emerging markets are leading the world in grassroots adoption, and peer-to-peer (P2P) trade volume makes up a significant percentage of all cryptocurrency use in these regions.

Many investors are using crypto to diversify their portfolios against inflation. For example, Venezuelans have increasingly embraced crypto after Venezuela’s Bolivar depreciated more than 100,000% from December 2014 to September 2022. Venezuelans received $37.4 billion worth in 2022 alone.

According to a survey PYMNTS conducted of merchants with annual online sales totaling at least $250 million, 46% of merchants accept crypto as payment. PYMTS also found that “85% of businesses with more than $1 billion in annual online sales say they accept some form of crypto-enabled payment method. Deloitte’s 2021 Merchants getting ready for crypto study, which polled 2,000 senior executives at U.S. retail organizations, found that over 75% of merchants reported plans to accept stablecoin and cryptocurrency payments in the next two years.

While blockchains are most commonly used to facilitate value exchange, that’s not where their usefulness ends. The technology’s diversity goes far beyond value exchange, it can support use cases across banking, logistics, digital ownership and governance.

There are four different kinds of blockchains: public, private, hybrid and consortium. Under this umbrella are hundreds of blockchains and thousands of crypto currencies that serve varying functions and network operations.

A common criticism against blockchain’s real-world application, especially by large institutions, are the throughput issues of blockchain networks like Bitcoin – or how many transactions can be processed per second.

Referred to as the Blockchain Trilemma, the challenge of “balancing and maximizing scalability, decentralization, and security in one network”, highlights how the crypto ecosystem continues to overcome technical hurdles with purpose-built applications.

Indeed, Bitcoin’s transaction speed doesn’t allow developers to build apps on the network. This limitation was the impetus for Layer 2 networks, like Etheruem of Polygon, designed to improve scalability, environmental impacts, and other challenges.

“Bitcoin, Ethereum, and BNB have all managed to grow and attract millions of users precisely because they’re not interchangeable. Each one offers different benefits to both developers and end users, which stem from the choices made in how they were built, particularly in their tradeoffs between decentralization, scalability, and security,” Chainalysis Myth Busting Report

“Scalability may or may not be the most important factor for a specific network’s success, it depends on the purpose,” says Jeff. “When people compare Bitcoin to MasterCard the assumption is that Bitcoin is a payment network, but it’s also many other things. Its scale limits are features, not bugs. Meanwhile, other networks are being purpose built for handling large transaction volumes or as payment rails.”

Bitcoin’s Proof-of-Work consensus mechanism puts its emphasis on decentralization and security. Its purposeful scarcity enables it to act as a store of value and hedge against fiat financial systems, often referred to as “digital gold”. However, its block size and 10-minute block processing speed limit its transaction abilities per second.

Meanwhile, the Ethereum blockchain was built not only to support its native Ether token as a store of value, but to be programmable. Developers can use the Ethereum blockchains programming language, Solidity, to build smart contracts and apps as well as create non-fungible tokens. Smart contracts built on Ethereum, as self-executing contracts written into code, offer decentralized applications for borrowing, lending, and asset exchange. Ethereum’s recent transition from a Proof-of-Work (PoW) to a Proof-of-Stake (PoS) network allows it to process more transactions per second than bitcoin.

BNB, created and managed by Binance, is similar to Ethereum but uses Proof-of-Staked-Authority which lowers fees and improves scalability, but with more centralized control.

“While the kernel of innovation started with peer-to-peer networks like Bitcoin and Ethereum, these new methods of community building, whether in virtual reality or for buying and selling digital art, show that the ability to build on top of these networks is almost unlimited,” says Jeff. “Other examples like DAOs and DeFi are creating systems of economy that use assets in new and different ways without requiring a traditional broker.”

“Considering that a blockchain is a permanent, secure, traceable database, the business applications are endless — supply chain management, data management, logistics, healthcare, media, stock trading, auditing, internet of things (IoT), and more. For instance, Sustainable Shrimp Partnership (SSP) is using IBM’s Food Trust — a blockchain solution for supply chain intelligence — to ensure it produces shrimp sustainably. With tracking and tracing capabilities, SSP can also share information about its product’s origins with retailers and customers,” says Chainalysis in the report.

Applications of Blockchain Data Solutions Providers: expanding abilities for risk management in the ecosystem

As institutional adoption of cryptocurrencies continues, Chainalysis sees many avenues for further applications of blockchain data visibility beyond KYC cornerstones which have been most prevalent to date.

“Rather than just being data for compliance, sanctions exposure, and transaction monitoring – our belief is that this data will be helpful in many other areas of risk management – and understanding the overall health of cryptocurrency businesses and sectors,” says Jeff.

“Possible applications include counterparty analysis and liquidity risk. Once businesses have built their compliance cornerstone, they can look to this data to solve for many other market wide risks that have been unidentifiable up to this point.”

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Beyond this deal, UBS has also turned to technology to strengthen its leadership position. In fact, it spent roughly $4B on tech in 2022 alone.

Its commitment to technology can be broken down into 2 main objectives. The first is the digitization and expansion of its existing services to enhance the client experience. The second is diversifying its investment and trading products through the use of novel technologies like blockchain, cloud, and alternative investment platforms.

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Business-to-business (B2B) fintechs were central to its strategy — in fact, 85% of the fintechs accepted in W23 cater to businesses.

While 77% of the fintech companies in the W23 cohort are based in the United States, Y Combinator also turned to emerging markets. The accelerator invested in 5 emerging-market fintechs, most of which cater to businesses. A couple of examples include Colombia-based treasury automation platform Milio and account-to-account (A2A) payments solution Palomma.

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For example, ad spend in the mobile gaming industry alone is projected to grow 10% this year, generating $6.3B. Top investors are jumping on the opportunity. Andreessen Horowitz (a16z) announced a $600M fund called GAMES FUND ONE in May 2022. 

Seventeen percent of all the deals a16z participated in last year went to the gaming & entertainment industry, and 79% of these deals were early-stage.  

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To meet this need, leading global payment network Visa has forged hundreds of strategic business partnerships, invested in dozens of companies, and made a few acquisitions over the last 2 years. 

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Crypto payments for small and medium-sized businesses (SMBs) provide the infrastructure that enables merchants to accept cryptocurrency payments and make payouts in crypto, either online or in person.

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Crypto asset management companies provide passive crypto investment strategies to institutional clients. Examples include single- and multi-asset crypto index funds, trusts, exchange-traded funds (ETFs), and separately managed accounts.

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Institutional staking companies in this market offer yield generation for institutional investors through staking, where crypto assets are allocated to process transactions and secure protocols (e.g., Ethereum) in exchange for rewards.

Staking providers run nodes (a requirement to stake) as a service for clients, eliminating the technical overhead that institutional investors face when setting up and managing their own nodes.

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