New Paradigm and Investment Logic in the AI + Web3 Era

Title: New Paradigms and Investment Logic in the AI + Web3 Era

Author: Rhythm BlockBeats

Source:

Repost: Mars Finance

Preface

In the past two years, AI concepts have been everywhere, with large models and decentralized technologies intertwined, leaving many people dazzled. As a VC firm, we've reviewed hundreds of cross-sector projects and want to share some honest truths—including the real cycle of the AI industry, why AI cannot do without Crypto, and what we prioritize and remain cautious about when evaluating projects.

Note: The content of this article is excerpted from the roundtable discussion titled "AI + Web3 - The Real Revolution" at the "AI + Bitcoin, the Next-Gen Revolution - BTC Vegas Side Event" held on April 28.

1. The "Seven-Layer Matrix" of the AI Industry and Investment Cycles

Although giants like OpenAI, Anthropic, and Google are currently in the spotlight, seemingly poised to dominate everything, our research indicates that the entire AI industry is still in a very early stage.

Being early doesn't mean you can blindly invest now, especially in overheated fields like AI hardware manufacturing, which require careful consideration. In our view, the AI industry chain can be broken down into seven distinct layers from bottom to top, each requiring a completely different investment approach:

• Seventh Layer: AI Intelligent Agents

• Sixth Layer: Token Optimization

• Fifth Layer: Token Distribution

• Fourth Layer: Large Language Models

• Third Layer: GPUs

• Second Layer: AI Data Centers

• First Layer: Power Infrastructure

Taking the second layer—AI data centers—as an example, this is a typical cyclical industry. Over the past two years, global capital has been aggressively buying land and building data centers, expanding assets heavily. However, these capacities take time to complete and energize before they can be brought to market. Based on our observations, these large capacities are likely to come online around 2028.

This means that if everyone continues to pour money into traditional data centers now or next year, by 2028, when they all start operating, there could be a severe oversupply. Rents and returns will plummet, and investors who jump in late will suffer. Therefore, aligning with industry cycles and timing is crucial.

In 2024, we see significant opportunities in the AI computing layer, especially in cross-sector tracks that utilize Web3 for computing power scheduling. Currently, we have invested substantial resources and capital into this area. As a major shareholder, our AI computing infrastructure company is now in the final stages of preparing for Nasdaq listing.

2. Why AI and Crypto Are Inseparable

Many ask: since large models in Web2 are already so powerful, why does AI still need Crypto? In our view, this isn't just a forced concept; rather, as AI advances, there are two issues that traditional Web2 cannot solve:

1. Payment needs: AI Agents require their own "financial sovereignty"

Traditional bank cards, PayPal, or gateway payments are designed for humans, with complex identity verification and centralized clearing processes. But future AI Agents (smart proxies) will need to collaborate and transact in a completely different manner.

They often involve extremely small amounts (e.g., spending $0.0001 to buy a few seconds of computing power), high-frequency, continuous transactions. Using traditional Visa channels, fees could exceed the transaction amount. More importantly, the issue of "payment sovereignty": AI Agents have autonomous execution capabilities and, as they evolve, will inevitably need to own and control their own wallets, rather than always relying on human bank cards or risking being banned by centralized giants' APIs. Blockchain-based cryptocurrency payments are currently the only technology enabling machines to autonomously settle transactions with each other.

2. Long-term trust: Preventing hallucinations and enabling trustworthy auditing

Everyone knows that large models sometimes hallucinate, producing false or biased answers. In traditional Web2 black boxes, it's difficult for humans to verify whether an incorrect or biased response is due to inherent randomness or deliberate manipulation by centralized corporations.

This creates a real demand for blockchain. Recording key AI data, prompts, and call paths on-chain in real-time can create an immutable, traceable, and auditable evidence system. This not only defines data ownership but also provides a reliable way for humans to supervise and verify whether AI behavior complies with regulations.

3. Investment Projects: Honesty as the Metric

Every year, thousands of AI + Web3 business plans flood the market. After reviewing many stories, our core screening principle boils down to two words: honesty. This may sound obvious, but in today’s restless industry, honesty is perhaps the most scarce trait. We categorize honesty into two levels:

1. Team honesty—reject packaging and embellishment

Founders and core team members' backgrounds must be truthful, with no falsification or exaggeration. The industry often sees teams assembled hastily to chase bull markets or hot trends, with big-name scientists or prestigious backgrounds slapped together to create a facade, but internally, there's little cohesion. Such projects tend to fall apart when facing technical bottlenecks or market shifts. A truly capable team must have complementary skills, and founders must be genuine and committed.

2. Product honesty—reject PPT-driven hype and false metrics

The actual capabilities of a product and user data must be supported by solid code, node counts, and other tangible indicators. We've seen too many projects that simply connect to OpenAI's API, tweak a UI, and then boast on PPT that they have an "independent native large model," even presenting fake demos to deceive investors. Product development must be honest—truly solving problems for users.

In capital markets, dishonest projects driven by hype and falsehoods might temporarily inflate valuations through flashy financial maneuvers on secondary markets or exchanges. But without real underlying business, bubbles burst, and the final outcome is inevitably zero.

Conversely, honest projects that focus on solid work may appear slow initially, even somewhat naive to speculative capital. But because they are built on a firm foundation, they often endure and grow long-term. In investing, slow can be fast; projects capable of lasting are the ones we are willing to invest in and support strategically.

4. The Most Undervalued Opportunity by 2026: The Ultimate Fusion of AI + Blockchain + Entertainment

Finally, regarding opportunities that are yet to be discovered or are severely undervalued, our research points to the deep integration of AI, blockchain, and entertainment.

Most current market capital is focused on AI payments and decentralized compute (DePIN)—hardcore, somewhat dull B2B infrastructure. While these sectors are important, competition is fierce, and they tend to be overlooked in terms of consumer engagement and capital accumulation.

Our logic is this: as large models and Agents mature, AI will become an efficient labor force capable of replacing most repetitive white- and blue-collar jobs. When productivity surges and material costs plummet, society will undergo a fundamental transformation—most people won't need to work just to survive. At that point, human demand for entertainment and leisure will explode. Where will people direct their time and energy? High-quality entertainment will become an essential outlet.

The future of entertainment should fully integrate AI.

Take gaming as an example: every NPC will have autonomous consciousness, with memories, personalities, and social relationships. Players entering such a game won't face repetitive scripts but will interact with "living" characters capable of emotional responses and even spontaneous on-chain transactions. AI will dramatically elevate the freedom and fun of gaming.

Blockchain's role is to define property rights: it will establish land ownership, the uniqueness of rare items, and build economic order through tokens.

When people no longer need to work in real life and devote their time, energy, and assets to such an engaging, AI-driven virtual world owned by players, the commercial value generated could be enormous. We are actively seeking disruptors in this space, as it could become the next narrative to ignite the entire industry.

Disclaimer: The content of this report reflects only the author's personal and institutional industry research views. It is for industry exchange purposes only and does not constitute any investment advice.