# Multicoin Capital Rejects AI Expansion to Maintain Crypto Focus The firm prioritizes its core crypto expertise despite broader venture capital market shifts. - **Source:** [INCRYPTED](https://brifing.si/source/7cd4625d-3f08-4cc1-983d-4c7d991839ba) - **Published:** 2026-10-20 - **Topic:** [Finance](https://brifing.si/c/finance) - **Original article:** - **On Brifing:** https://brifing.si/s/7a60846f-bdfa-4594-997a-6eb190308059 ## Strategic Commitment to Crypto Multicoin Capital has officially confirmed it will not expand its investment mandate into artificial intelligence startups. General partner Spencer Applebaum stated the firm intends to remain strictly focused on digital assets. Despite the industry-wide trend of venture funds diversifying into AI, Multicoin believes its core competitive advantage remains firmly rooted in the crypto sector. ## Market Capital Competition The broader venture landscape is currently witnessing a significant shift in capital allocation. AI companies secured approximately two-thirds of all startup investments in the United States and Canada during the third quarter. This intense competition for funding creates pressure on crypto-focused firms to either pivot their strategies or defend their niche market positions. ## Declining Crypto Fund Formation Data from Galaxy Research indicates that fundraising for new crypto-focused venture funds has reached its lowest point since late 2019. During the second quarter, investors directed only $3.9 billion into five new funds. This contraction reflects the increasing difficulty of raising capital for crypto-specific vehicles compared to the rapid growth of AI-focused investment opportunities. ## Investment Pace and Valuation Multicoin Capital is currently deploying capital from its 2022 fund at a slower pace than initially anticipated. Applebaum attributed this cautious approach to the recalibration of startup valuations following the 2022 FTX collapse. The firm observed seed rounds reaching $30 million valuations on just $3 million in funding, prompting a more disciplined investment strategy. ## Hyperliquid and HYPE Token The firm's largest hedge fund position is currently held in HYPE, the native token of the decentralized derivatives exchange Hyperliquid. Unlike short-term trading strategies, Multicoin maintains a long-term holding horizon for its public investments. The firm has publicly projected that the HYPE token could potentially exceed a $300 valuation by the year 2028. ## Avoiding Forced Market Intersections Applebaum criticized the industry trend of forcing intersections between artificial intelligence and blockchain technology. He noted that many entrepreneurs currently seek solutions for problems that do not actually exist at this intersection. By avoiding these forced narratives, Multicoin aims to leverage its specific expertise and network to support genuine, crypto-native innovation rather than chasing trends. ## Industry-Wide Strategic Shifts While Multicoin remains committed to its original focus, other major players are actively diversifying their portfolios. Firms such as Paradigm, Framework Ventures Management, and Haun Ventures have begun exploring opportunities beyond the digital asset space. This divergence highlights a growing divide in how venture firms are navigating the current maturity phase of the crypto industry. ## Future Outlook for Crypto The crypto startup ecosystem faces a complex environment as total funding for the first half of 2026 reached approximately $10 billion. This figure represents only half of the total volume recorded throughout 2025. Multicoin’s decision to stay the course underscores a belief that specialized expertise will outperform broader, less focused investment strategies in the long term. ## Sources covering this story - https://incrypted.com/bloomberg-multicoin-capital-vidmovlyayetsya-rozshyryuvaty-investytsiyi-v-shi/ — --- _Summary written by Brifing from the original reporting. Copyright in the original article belongs to its publisher; read the full piece at the link above._