From theblock by Yogita Khatri

The last few days have been a whirlwind in the crypto world, with bitcoin crossing the $93,000 mark right after Donald Trump's election victory. It's wild to think back to when I first started writing about crypto in 2018, seeing bitcoin at just around $3,000. But here we are, witnessing the future unfold.

I spoke with a dozen crypto VC investors, and while the excitement around Trump's win and bitcoin's rise is undeniable, most are sticking to their long-term plans. That said, some are tweaking their approach, paying closer attention to new trends and changes in the political and market landscape.

"I think the industry is right to be ecstatic," Lasse Clausen, founding partner at 1kx, told me. "You have to be an industry insider to really comprehend the scale of innovation destruction this past administration did. So outsiders are still underpricing how many exciting products are going to be created in this industry now that founders are free to experiment again."

Arianna Simpson, general partner at a16z crypto, echoed Clausen's sentiments, noting that the "last few years have been challenging" for the crypto industry. However, she expects a "significant shift in policy" that will greatly benefit web3 builders and companies.

Given the expected crypto regulatory clarity under the Trump administration, investors anticipate more founders will begin building in the web3 space. Earlier this week, Portal Ventures, founded by Evan Fisher, a former investor at Insight Partners, which manages over $80 billion in assets under management (AUM), raised $75 million for its second fund, which will exclusively invest in crypto pre-seed stage startups. Fisher told me that he expects repeat founders who previously sold their businesses and are sitting on a couple hundred million dollars, but were hesitant to enter crypto due to legal and regulatory risks, to start entering the space now that the regulatory environment has de-risked. "We will see that upper top echelon of founders start to enter crypto a bit more," Fisher said.

Jake Brukhman, founder, managing partner and CEO of CoinFund, told me that his firm is gearing up for what he described as a "super cycle" in the crypto market. CoinFund is well-capitalized across its seed, venture and liquid investment programs, Brukhman said, adding that the firm has expanded its investment team with six new hires this year — five of them joining in just the last two to three months.

Betting big on crypto-AI, DeFi and more

Looking ahead, crypto VCs are zeroing in on high-potential sectors like crypto-AI, DeFi, real-world assets (RWA) tokenization, infrastructure, stablecoins, payments and more.

Many investors see the intersection of crypto and AI as the next transformative trend. Ed Roman, co-founder and managing partner at Hack VC, described crypto-AI as "the undisputed sexiest category in crypto right now," envisioning a multi-layer web3 AI stack that leverages cost efficiencies from decentralized compute networks. "This is a multi-trillion-dollar market when serving web2 customers," Roman said. "AI is not a fad (like NFTs were). AI is creating real business value and is probably the most important innovation in tech since mobile phones and the Internet."

However, the health of the crypto-AI category is largely dependent on the health of the web2 AI category, which takes its cues from NVIDIA, Roman said. So Hack VC is keeping a close eye on NVIDIA as a "loose proxy" for crypto-AI.

Balder Bomans, CIO and managing partner at Maven 11 Capital, also sees crypto-AI startups growing, especially favoring AI-driven DePIN protocols that provide compute for AI model training. CoinFund's Brukhman added that most retail investors wanting exposure to AI will likely get it through crypto next year. "AI coins are scarce and seeing massive demand. Summer 2025 is decentralized AI (deAI) summer," he said.

Another key focus for investors is the resurgence of DeFi as institutional adoption grows. Hack VC's Roman noted that DeFi suffered recently due to high interest rates, which made U.S. Treasury Bills more attractive. However, Trump's anticipated interest rate cuts could make DeFi more competitive with traditional financial (TradFi) instruments like Treasury Bills, Roman added. He sees DeFi as a "once-in-a-generation opportunity" to streamline finance.

1kx's Clausen pointed out that TradFi institutions might now work on bringing RWAs on-chain and using DeFi infrastructure at scale. "Just think how broken trading, clearing and settlement in TradFi is, whereas a decentralized exchange (DEX) trade is all three in one instant transaction without any counterparty risk and publicly verifiable absence of exchange operator fraud," Clausen said. "It's like fishing with dynamite; it's not even fair."

Erick Zhang, managing partner at Nomad Capital and former Binance executive, also sees DeFi poised for growth, especially with renewed activity in altcoins and the ongoing challenges faced by centralized exchanges. Will Nuelle, general partner at Galaxy Ventures, and Thomas Klocanas, general partner and head of venture at BlockTower Capital, also foresee an expansion of DeFi, RWA tokenization, stablecoin and payments categories.

"Post Trump's inauguration, it's clear that one of the biggest blockades to stablecoin adoption in payments — banking relationships for interfacing with the fiat system — just got easier," Nuelle said. "We hope/expect that banks which serve lawful crypto won't be fearful of retribution from the Federal Deposit Insurance Corporation (FDIC) or other agencies, which should ease banks' ability to integrate with the clearly growing use case."

Consumer-facing applications and infrastructure categories are also gaining traction. "I am particularly excited about consumer applications of crypto taking off, as that category has been especially adversely affected by the policies of the outgoing administration," said a16z crypto's Simpson. "We are also still very interested in DePIN and infrastructure projects continuing to develop."

Alvaro Gracia, partner at Borderless Capital, also highlighted the potential growth in the DeFi and DePIN sectors as bitcoin dominance shifts toward altcoins. Gracia, who oversees a $100 million DePIN fund, remains particularly bullish in this category, noting that the fund still has approximately $70 million available and is set to be deployed over the next two to three years.

1kx's Clausen added that infrastructure, middleware and consumer applications are the focus categories of his firm, especially consumer applications requiring banking integrations, which were previously hindered by regulatory constraints.

Adam Winnick, general managing partner at Finality Capital Partners, expressed optimism about infrastructure verticals, emphasizing restaking and zero-knowledge technology startups as key areas of focus. Miko Matsumura, managing partner of Gumi Cryptos Capital said he is focused on base-layer and scaling infrastructure projects that aim to solve "normal problems for normal people" rather than solving "crypto problems for crypto people."

Meanwhile, for some investors, infrastructure isn't as exciting. Maven 11's Bomans noted that the firm has shifted focus toward application-level investments in the past 12 months, as large scaling bottlenecks have been cleared by both the rise of strong monolithic chains and continuous improvements in the modular stack.

Portal Ventures' Fisher said his firm has been short on infrastructure projects, instead favoring commercial startups with clear distribution advantages and strong user demand.

Nomad Capital's Zhang also mentioned his firm's more cautious approach to deploying capital in infrastructure projects, particularly Layer 1 and Layer 2 networks. "Most infra projects are essentially 'infra memes,' where success often hinges on the founding team's ability to manage the narrative and branding effectively," he said. "However, the pool of teams that can excel in this unique dynamic remains limited."

Risks of a Trump administration

While Trump's presidency brings renewed optimism to the crypto space, several VCs cautioned against potential risks that could impact the industry's trajectory.

1kx's Clausen raised concerns about Trump's immigration policies, suggesting that a reduced labor supply could lead to sticky wage inflation, which could be bearish for risk-on assets like crypto.

Galaxy Ventures' Nuelle noted the risk that if "Trump becomes too laissez-faire" regarding the crypto industry, it could repeat failings like FTX. He said balanced, bipartisan legislation and general clarity regarding the status of digital assets will create the most stable long-term value.

Zhang of Nomad Capital highlighted the possibility of a "Trump effect" losing momentum if bold proposals, such as bitcoin becoming a U.S. strategic reserve asset, fail to materialize quickly. Unrealized expectations could temper market enthusiasm, he said.

Hack VC's Roman also said that one of the most important outstanding questions is: will the U.S. actively stockpile new bitcoin, or simply hold existing seized bitcoin? Either outcome is a likely win for crypto, but if the U.S. actively builds a bitcoin stockpile, that could become a new standard that cascades into other countries and impact their policies, which would be a more significant win for crypto broadly.