Which encryption zones are favoured by Trump's election? This is what more than a dozen venture capital pros have to say.

By Yogita Khatri, The Block; Compiler: Tao Zhu, Golden Finance

In the past few days, the crypto world has been swept by a whirlwind. After Donald Trump ( won the election, the price of Bitcoin broke through the $93,000 barrier. Looking back to 2018 when I first started writing articles about cryptocurrencies and seeing the price of Bitcoin at around $3,000, it felt insane. But here we are, witnessing the unfolding of the future.

I spoke with more than a dozen crypto VC investors, and while the excitement that comes with Trump’s victory and Bitcoin’s rise is undeniable, most are sticking to their long-term plans. That said, some are adapting their approach to pay closer attention to new trends and changes in the political and market landscape.

“I think it’s right that the industry is ecstatic,” 1kx co-founder Lasse Clausen told me. “You have to be an insider to truly understand the scale of the last government’s destruction of innovation. Therefore, now that founders can freely try again, outsiders still underestimate how many exciting products this industry will create.”

Arianna Simpson, a general partner at a16z crypto, agrees with Clausen’s view, stating that “the past few years have been challenging for the crypto industry.” However, she expects that “significant policy shifts” will greatly benefit web3 builders and companies.

Given the expected clarity of cryptocurrency regulation under the Trump administration, investors anticipate that more founders will begin to venture into the web3 space. Earlier this week, Portal Ventures, founded by former Insight Partners investor Evan Fisher, raised $75 million for its second fund, which manages over $80 billion in assets under management )AUM(, and will specifically invest in early-stage cryptocurrency seed startups. Fisher told me he expects that repeat founders who previously sold businesses and sat on hundreds of millions but hesitated to enter the cryptocurrency space due to legal and regulatory risks will now enter the space as the regulatory environment has alleviated those concerns. Fisher said, “We will see high-level founders starting to enter the cryptocurrency space more.”

CoinFund founder, managing partner, and CEO Jake Brukhman told me that his company is preparing for what he calls a “super cycle” in the crypto market. Brukhman stated that CoinFund is well-capitalized for seed, venture capital, and liquidity investment projects, and added that the company has hired 6 new employees this year, expanding the investment team, 5 of whom joined in the past two to three months.

Betting on cryptocurrency, artificial intelligence, DeFi, etc.

Looking to the future, cryptocurrency venture capital firms are focusing on high-potential areas such as crypto artificial intelligence, DeFi, real-world asset (RWA) tokenization, infrastructure, stablecoins, and payments.

Many investors see the intersection of cryptocurrency and artificial intelligence as the next transformative trend. Ed Roman, co-founder and managing partner of Hack VC, describes crypto AI as “the undisputed sexiest category in the crypto space right now,” envisioning a multi-layered web3 AI stack that leverages the cost efficiencies of decentralized computing networks. “This is a multi-trillion dollar market when servicing web2 clients,” Roman said. “AI is not a fad (like NFTs). AI is creating real business value and may be the most important technological innovation since the mobile phone and the internet.”

However, Roman stated that the health of the crypto AI category largely depends on the health of the web2 AI category, which is inspired by NVIDIA. Therefore, Hack VC is closely monitoring NVIDIA as a “loose proxy” for crypto artificial intelligence.

Maven 11 Capital’s Chief Information Officer and Executive Partner Balder Bomans has also observed the continuous growth of crypto AI startups, particularly favoring AI-driven DePIN protocols that provide computing for AI model training. Brukhman from CoinFund added that most retail investors looking to engage with artificial intelligence may do so through cryptocurrency next year. “AI coins are scarce, but the demand is high. Summer 2025 will be the summer of decentralized artificial intelligence )deAI(.”

Another focus of investors is the resurgence of DeFi as institutional adoption increases. Roman from Hack VC pointed out that DeFi has recently suffered losses due to high interest rates, making U.S. Treasury bonds more attractive. However, Roman added that the anticipated interest rate cuts by Trump could make DeFi more competitive against traditional financial tools like Treasury bonds. He sees DeFi as a “once-in-a-generation opportunity” to simplify finance.

Clausen from 1kx pointed out that TradFi institutions may now be dedicated to bringing RWA on-chain and widely using DeFi infrastructure. Clausen said, “Think about how terrible trading, clearing, and settlement are in TradFi, while decentralized exchange )DEX( offers three-in-one instant trading with no counterparty risk and no publicly verifiable exchange operator fraud.” “It’s like fishing with dynamite; it’s not even fair.”

Nomad Capital Managing Partner and former Binance executive Erick Zhang also believes that DeFi is expected to grow, especially in the context of the resurgence of altcoins and the ongoing challenges faced by centralized exchanges.

Galaxy Ventures General Partner Will Nuelle and BlockTower Capital General Partner and Head of Venture Capital Thomas Klocanas also foresee the expansion of DeFi, RWA tokenization, stablecoins, and payment categories.

“After Trump’s inauguration, it was clear that one of the biggest obstacles to the adoption of stablecoins in the payment sector—the banking relationships interfacing with the fiat system—has become easier,” Nuelle said. “We hope/expect that banks providing legitimate cryptocurrency services will not have to worry about retaliation from the Federal Deposit Insurance Corporation (FDIC) or other agencies, which should alleviate the banks’ ability to integrate with the clearly growing use cases.”

The category of consumer-facing applications and infrastructure is also receiving increasing attention. Simpson from a16z crypto stated: “I am particularly excited about the takeoff of consumer applications in cryptocurrency, as this category is particularly adversely affected by upcoming government policy changes.” “We are still very interested in DePIN and sustainable infrastructure projects.”

Borderless Capital partner Alvaro Gracia also emphasized the potential growth in the DeFi and DePIN sectors as Bitcoin’s dominance shifts to altcoins. Gracia manages a $100 million DePIN fund, and she remains particularly optimistic about this category, noting that the fund still has around $70 million available, which will be deployed over the next two to three years.

Clausen from 1kx added that infrastructure, middleware, and consumer applications are the key categories for his company, especially consumer applications that require bank integration, which have previously been hindered by regulatory restrictions.

Adam Winnick, General Manager of Finality Capital Partners, expressed optimism about the infrastructure vertical industry, emphasizing that restaking and zero-knowledge technology startups are key areas of focus. Miko Matsumura, Managing Partner at Gumi Cryptos Capital, stated that he focuses on “middleware” infrastructure projects aimed at solving “normal problems for regular people” rather than addressing “crypto problems for crypto people.”

At the same time, for some investors, infrastructure is not that exciting. Bomans from Maven 11 points out that the company has shifted its focus to application-level investments over the past 12 months, as the rise of robust overall chains and ongoing improvements in modular stacks have eliminated the bottlenecks of large-scale expansion.

Fisher from Portal Ventures stated that his company has been lacking infrastructure projects and instead favors business startups with clear distribution advantages and strong user demand.

Zhang from Nomad Capital also mentioned that the company is more cautious in deploying capital for infrastructure projects, particularly layer one and layer two networks. “Most infrastructure projects are essentially ‘infrastructure memes’, and their success often depends on the founding team’s ability to effectively manage the narrative and branding,” he said. “However, there are still limited teams that can excel in this unique dynamic.”

Risks of the Trump Administration

Despite the new optimism brought to the cryptocurrency space during Trump’s presidency, several venture capitalists have warned of potential risks that could affect the industry’s development trajectory.

Clausen of 1kx expressed concern about Trump’s immigration policy, believing that a decrease in labor supply could lead to wage increases, which may be unfavorable for risk assets such as cryptocurrencies.

Nuelle from Galaxy Ventures pointed out that if “Trump becomes too lenient towards the crypto industry,” it could repeat the failures seen with FTX. He stated that a balance of bipartisan legislation and overall clarity regarding the status of digital assets would create the most stable long-term value.

Zhang from Nomad Capital emphasized that if bold proposals such as making Bitcoin a currency in the United States are put forward, the “Trump effect” may lose momentum. Strategic reserve assets have failed to be quickly realized. He stated that unmet expectations may dampen market enthusiasm.

Roman from Hack VC also stated that one of the most important pending questions is: Will the U.S. actively accumulate new Bitcoins, or will it simply hold the existing seized Bitcoins? Either outcome could be a victory for cryptocurrency. Actively building a Bitcoin inventory could set a new standard, influencing other countries and affecting their policies, which would be a more significant victory for cryptocurrency.