From Crypto to AI: When Market Demand Curves Shift and Industry Talent Redirects Focus

A statement by a prominent figure in the AI industry advising young people to “not waste time with cryptocurrency” recently sparked a wave of reflection in the global crypto community. However, this controversial remark is actually just a symptom of a much larger phenomenon: a systematic reallocation of talent, capital, and attention from the blockchain ecosystem toward frontier AI. This reflects a fundamental shift in the demand curve for talent and capital allocation in the tech industry.

When we observe this transition comprehensively, it becomes clear that the crypto industry is facing structural challenges that cannot be solved by its own cycles. This is not just temporary market pessimism but a resource reallocation driven by changes in the technological landscape and investment opportunities.

Talent Migration: When Crypto OGs Become AI Influencers

The most striking phenomenon is how industry pioneers in crypto are gradually shifting their focus. Long Jia, an early founder of the Bitcoin ecosystem in a certain region, once recommended Bitcoin investments to the youth in 2011—advice seen as visionary at the time. But by 2023, his platform had ceased publishing crypto-related content and shifted entirely to coverage of AI and the metaverse. In 2024, Long Jia completely left the crypto industry to start an AI venture.

A similar story is Shen Yu, co-founder of the leading crypto wallet platform Cobo. As a survivor of multiple market cycles, Shen Yu is known for deep insights into market phases and investment perspectives shared on social media. However, in recent months, over 80% of his social content focused on AI development, with crypto content shrinking drastically. Shen Yu even joked about his “successful transformation” from crypto practitioner to AI content creator.

More dramatic shifts come from executives in blockchain application projects. Anthony Rose, director at zkSync, announced his departure from Matter Labs in February after four years, likely moving into AI. Nader Dabit, leading developer advocacy at EigenLayer, announced a similar decision at the same time, taking a role as head of growth at an AI company with a bold statement: “I’ve joined the future.”

The most shocking announcement came from Kyle Samani, co-founder of the venture capital firm Multicoin Capital, known for early speculation on Solana. Kyle Samani officially announced his exit from the crypto industry and shifted focus to AI, robotics, and other fields. What hurt the crypto community even more was his dismissive statement: “Cryptocurrency turned out to be far less interesting than many—myself included—thought.”

This talent migration is not an isolated phenomenon but a systematic pattern reflecting how key decision-makers are reassessing the landscape of opportunities.

Capital Reallocation: Paradigm and a New Phase of Tech Investment

More significant than talent migration is the strategic shift by leading venture capital firms. At the end of February, The Wall Street Journal reported that Paradigm—one of the most pure-play VCs in crypto—was preparing a fundraising round to support investments in AI and robotics, targeting around $1.5 billion.

This decision has profound strategic implications. Paradigm is not just an ordinary VC firm; since 2019, it has built a reputation through precise investments in projects that later experienced exponential growth—Uniswap, Lido, Optimism, dYdX, Blur, among others. Unlike a16z crypto, which is more research-driven, Paradigm’s move to create a dedicated AI fund signals a fundamental shift in where long-term value is perceived to lie.

Investment data tell a clear story. Venture investment volume in crypto has steadily declined over the past four years: from 1,639 deals in 2022 to just 829 deals projected for 2025. Simultaneously, early-stage funding share has dropped from 50% to below 35%. This contraction is not coincidental—it indicates that high-quality projects capable of attracting billion-dollar investments are now very limited in the space.

Crypto infrastructure narratives—layer 1, layer 2, DEXs, and similar protocols—have become highly competitive without producing paradigm-shifting innovations. In this environment, venture capital faces a fundamental dilemma: continuing to heavily invest in crypto portfolios means accepting higher concentration risks and lower return elasticity.

AI, on the other hand, offers a continuously expanding investment frontier. From large language models to AI agents, from compute hardware to robotics industries—AI can accommodate not only large-scale capital but also keep generating new growth stories. For VC firms managing over $12 billion in assets, the core question is no longer about ideology or belief but about whether the mechanisms of return still hold.

The Community’s New Obsession: From Crypto Alpha to AI Efficiency

On a different level, public community attention within crypto is also shifting dramatically. Historically, crypto communities excel at capitalizing on every trend—from political issues to the latest technological innovations, always with projects or meme coins riding the social momentum.

But as AI becomes mainstream, community responses are evolving. Instead of immediately trying to capitalize on the trend with meme coins or “Crypto+AI” projects, the community is moving toward more genuine engagement. Crypto researchers are sharing tutorials on setting up and using AI, sharing their workflows, even detailed techniques for training AI agents to write code, conduct research, or generate content.

Some crypto influencers are even launching consulting services to help beginners set up and optimize AI tools—indicating that demand for AI knowledge has surpassed mere speculative interest. Offline crypto community events are also shifting focus: the “Web4 China Tour” organized by leading OG firms from Feb 25 to Mar 8 across five cities, with main agendas around OpenAI and AI agents, almost without crypto content.

This is no longer just about chasing fleeting trends. It’s a genuine shift in attention, driven by authentic fears among progressive players that they will fall behind in this new technological era. The demand curve for content and expertise has shifted: from “how can I profit from crypto” to “how can I survive and thrive in an AI-dominant world.”

Why Has the Crypto Industry Failed to Maintain Momentum?

The key question is: why did the crypto community shift focus so quickly?

Part of the answer lies in the very DNA of the crypto industry. Crypto is an industry with the highest concentration of “super-individuals”—independent developers, active traders, content creators—who are naturally motivated to improve their efficiency tools. When AI can significantly amplify personal productivity, this group becomes the most enthusiastic early adopters.

Moreover, the core culture of crypto has a strong geek spirit and deep respect for technological innovation. Although recent years’ technical narratives have been overshadowed by tokenomics and speculation, most practitioners still believe in the fundamental premise: “core technology can change the world.” AI now carries a “bigger technological revolution” vibe than blockchain, naturally attracting the overenthusiasm of a community that once loved crypto.

But there’s a deeper reason: in the crypto market slowdown, genuine innovation in the sector has drastically decelerated. While AI continues to create “new things” with high consistency, crypto keeps recycling old narratives. Without significant wealth effects, the ecosystem can only survive on trickle-down effects from market predictions and limited real-world assets. In this context, cognitive stimulation and new discussion topics from the AI industry not only capture attention but also fill the psychological void left by slowing market momentum.

In the AI Era: Explosive Productivity, Urgent Meaning

Returning to the beginning: the OpenAI founder’s advice to youth to avoid crypto sparked reactions not out of condescension but because he was stating a truth that many crypto practitioners are quietly verifying—top players are reallocating their time and attention.

We are entering an era where wealth creation slows while technological productivity explodes. On one hand, the slowdown in crypto cycles means diminishing alpha, flat wealth growth curves, and declining marginal returns from “information-following → trend-chasing → profit-seeking.” On the other hand, AI shortens human problem-solving times dramatically—coding, content creation, research that once took hours now takes minutes.

As the “search-for-results process” is condensed by AI, we may face a paradoxical abundance: more free time but a potential loss of direction. In this future, what will truly differentiate individuals is no longer execution speed or information efficiency—AI has already surpassed humans in these areas—but taste, judgment, and the ability to build personal meaning beyond market fluctuations.

The decision of crypto practitioners to shift toward AI ultimately reflects a deeper reality: they are not just following trends but reallocating resources toward sectors still creating “new stories” and growth opportunities. This is a genuine shift in the demand curve of the market.