Artificial intelligence startups received the lion’s share of venture capital investments across the globe in the first quarter of 2025, according to new data from Pitchbook.

“Investors still have an AI FOMO [fear of missing out] problem,” the research firm said in an April 17 report, which revealed that 57.9% of global venture capital dollars in Q1 went to AI and machine learning startups.

Comparatively, the first quarter of 2024 saw just 28% of VC dollars channeled into AI startups.

Pitchbook said the capital flowing into AI was even more concentrated in North America, with 70% of venture funding in the region going into AI startups in the first quarter.

The global AI sector raised $73 billion in the first quarter, which was more than half of the total value of AI-related deals made last year. However, more than half of that was for OpenAI, which closed a $40 billion funding round led by SoftBank on March 31.

Other notable AI funding rounds in March included Anthropic, which raised $3.5 billion in a Series E round. 

“The fear of somebody else winning your market has never been higher than it is now,” said Maria Palma, general partner at Freestyle Capital. “You haven’t seen a slowdown because the rate of change on the technology side is almost indigestible,” she added. 

Nnamdi Okike, co-founder and managing partner at 645 Ventures, cautioned that there are extremes happening, “and that’s going to mean there’s going to be a lot of losers.” 

“A lot of VC funds are just kind of saying, ‘Hey, this can only go up.’ And that’s usually a recipe for failure — when that starts to happen, you’re becoming detached from reality,” he added.

AI deals as a share of all global VC deal activity. Source: PitchBook

Crypto venture capital creeps up 

Comparatively, crypto and blockchain startups raised just $4.8 billion in Q1, according to CryptoRank. Almost half of that, $2 billion, was Abu Dhabi investment firm MGX investing in Binance. 

This was still over four times as much as the $1.1 billion raised in the fourth quarter of 2024, and the biggest quarter for crypto venture capital deal value since the third quarter of 2022.

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Crypto venture capital appears to be warming again with a friendlier regulatory environment emerging in the US.

On April 17, Mike Novogratz’s Galaxy Ventures Fund I was reportedly set to exceed its $150 million funding target and could hit $180 million when it closes at the end of June. 

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The firm behind the Solana-based automated market maker (AMM) Raydium has launched its memecoin-making protocol, LaunchLab, which looks to compete with Pump.fun.

The arrival of LaunchLab on April 16 comes a month after Pump.fun, previously a key contributor to Raydium’s revenue, severed ties with the firm by moving its token migration from Raydium’s liquidity pools to its own new decentralized exchange, PumpSwap.

LaunchLab will leverage Raydium’s liquidity pools and aim to dethrone Pump.fun as the leading Solana memecoin launchpad.

Raydium said LaunchLab provides memecoin enthusiasts with customizable bonding curves and no migration fees, while tokens that raise 85 Solana (SOL) — currently worth $11,150 — will transition to Raydium’s AMM instantly.

Around 10 LaunchLab tokens have already surpassed this threshold, according to the LaunchLab platform.

Raydium said tokens can be launched for free and creators can opt-in to earn 10% of trading fees from the AMM pool post-graduation.

Source: Raydium

LaunchLab trading fees are set at 1%, and 25% of those fees will be used for Raydium (RAY) buybacks.

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The news triggered a near 14% price surge of the RAY token, pushing it up to $2.41 four hours after the announcement before falling back to $2.21 at the time of writing, CoinGecko data shows.

PumpSwap volume on a tear

PumpSwap’s daily record in trading volume has now been broken five days in a row after posting $460 million on April 17.

The April 17 tally narrowly edged out the $454.9 million in trading volume seen on April 16, making it the fourth consecutive day above $400 million.

Daily change in trading volume on PumpSwap since March 22. Source: DefiLlama

PumpSwap has now processed $7.3 billion worth of volume since it launched on March 22, DefiLlama data shows.

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Despite recent major developments in the crypto industry, the market has just posted its weakest Q1 performance in years — but a crypto analyst is pointing to several catalysts that could make Q2 more promising.

“Frustrating. That’s the best word to describe the past quarter,” Bitwise chief investment officer Matt Hougan said in a recent market report, calling Q1 the “best worst quarter in crypto’s history.”

Bitcoin and Ether took an unusual hit in Q1

Bitcoin (BTC) and Ether (ETH), the two largest cryptocurrencies by market capitalization, saw price declines of 11.82% and 45.41%, respectively, over Q1 2025 — a quarter that has historically seen strong results for both assets. Since 2013, Q1 has been Bitcoin’s second-strongest quarter on average (51.2%) and historically the best for Ether (77.4%), according to CoinGlass data.

Historically, Q1 2025 is the second-best performing quarter for Bitcoin on average, but it’s the best for Ether. Source: CoinGlass

Hougan pointed to a few key catalysts that could help crypto deliver more upside to Q2. 

He noted the rise in global money supply, which “after years of tightening, central banks across the globe are signaling a shift toward monetary easing and M2 expansion.”

“Historically, these conditions have been favorable for risk assets, particularly for digital assets,” Hougan said. Echoing a similar sentiment, Pav Hundal, the lead analyst at Australian crypto exchange Swyftx, told Cointelegraph in February that “in normal times, global loosening measures are a pretty reliable lead indicator for crypto.”

More recently, on April 14, analyst Colin Talks Crypto said, “Global M2 has remained at an ATH for 3 days in a row.” Bitcoin moves in the direction of global M2 83% of the time, economist Lyn Alden wrote in a September research report.

BTC/USD vs global M2 supply. Source: Colin Talks Crypto

Hougan also said the “clean sweep of pro-regulations” in the US may be another bullish factor for the crypto market. “This is the long tail of regulatory clarity that no one is talking about, and it’s just getting started,” Hougan said.

The rise in stablecoin assets under management may also be a positive indicator that more upside is to come this year in the crypto market. Hougan said during the first quarter, stablecoin assets under management surged to “an all-time high of over $218 million.”

“Growing stablecoin adoption will benefit adjacent sectors, including DeFi and other crypto applications,” he said. 

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The firm also said that the “geopolitical chaos” seen in the global economy during Q1 2025, mainly after US President Donald Trump’s inauguration through his tariffs, “are pushing global investors to reassess their portfolios.”

It comes only days after Hougan recently reiterated his prediction that Bitcoin may surge approximately 138% from its current price of $84,080 by the end of the year.

“In December, Bitwise predicted that Bitcoin would end the year at $200,000. I still think that’s in play,” Hougan said.

Meanwhile, crypto exchange Coinbase recently said, “When the sentiment finally resets, it’s likely to happen rather quickly, and we remain constructive for the second half of 2025.”

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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.