This AI Altcoin Raised $65M... So Why Am I Worried?

[00:00] We have a little bit of controversy  in the AI token sector. Obviously,   I still believe that AI is one of the best  niches to be investing in crypto in 2026. I   think decentralized open-source AI moving forward  really has a place as the industry continues to  

[00:17] grow. But we do have a little bit of controversy  as one of the biggest AI projects recently raised   $65 million on a Series A round. This has people  divided on if this is actually bullish or bearish  

[00:30] for the token because of the token versus equity  splits. So, I am going to go over some of the   feedback that we are seeing online about this and  also give my opinion in the short, mid, and long   term. Let's go ahead and jump right into it, guys.  If you are new to the channel on In The Money, we  

[00:45] give you everything you need five days a week here  to win across crypto and prediction markets. And   of course, like the video down below and subscribe  to the channel for more. Let's just go ahead and   make this one a quick video today. I want to hop  right into it. So, over the course of the year,  

[01:00] Venice has really been one of the biggest, highest  performers as far as the AI space. And whenever   you look at the fully diluted market cap now  sitting at $1.06 billion, it is one of the biggest  

[01:13] AI tokens in the entire market. And if you look  at the weekly chart, we can see here on the data   that this thing took a big pump yesterday from  $12.30 all the way up to almost $15. I mean,  

[01:26] that is a pretty solid move for a billion  dollar valuation token. And a lot of people were   wondering, well, why did this happen? But if we  look here, you can see they become a unicorn with  

[01:38] $65 million Series A round funding. Let's just  go ahead and look at some of the actual press   releases on this. We see Venice AI has raised  $65 million Series A at a $1 billion valuation,  

[01:53] giving the privacy-focused AI platform unicorn  status. Founder Eric Vorhees said that they will   construct the platform dedicated to private and  unrestricted machine intelligence. Now, first and  

[02:05] foremost, I think that the Venice platform is  awesome. Decentralized AI completely private,   so it is an LLM built with all the biggest LLMs  in the world, OpenAI, Claude, etc., all into one,  

[02:19] but it is private, so nobody is selling or  leaking your data, etc. And I think there is   a big space for that. Obviously, as you see this  Series A raising $65 million, the one thing that   people are divided on on the timeline about this  is yes, we look at the yearly chart on this thing,  

[02:36] it is one of the highest performers in the AI  space. And I have a position here also, which I   opened up at $8, and I still firmly believe that  it is viable to be a Venice token holder. I do  

[02:49] not think that this changes that in the short to  midterm, but some of the responses here are pretty   crazy. We see here, "Venice raised a Series A  and CT is celebrating. This is very bearish.   The team will now drive value back to their equity  investors only." And that is not entirely false. I  

[03:07] do think that a lot of this whenever you do raise  that amount of capital Series A, traditionally,   you are going to accrue as much value for those  equity holders over the token holders. He says,   "The token is irrelevant and will not accrete  value. Expected them to get bigger and bigger  

[03:23] and raise more money while the token goes to  zero. Why would equity investors invest if the   value flows to the token that they do not have a  stake in?" Now, Eric says that the investors hold  

[03:35] less than 10% of the company, and investors have  a massive stake in the token as it is the largest   asset that the company holds. And of course, Eric  is defending that equity holders and token holders   still have similar incentives. We see Tulip King  here saying, "I recommend not falling for this.  

[03:51] Token equity splits are fundamentally flawed.  Equity holders with a bunch of tokens do not align   incentives. We have seen this before. It is an  excuse to get liquid and sell." That is true. So,  

[04:03] just being objective here, I do not like the  fact, honestly, if the equity holders just bought   equity, perfect. But the fact that the equity  holders apparently are aligned on the token,   as he says here, they are going to get liquid and  sell. So, I do not entirely love that. I will be  

[04:23] completely honest with you. That is one thing I do  agree with. If the equity holders just bought part   of the company, fine, but they apparently have  a stake in the token as well that usually does   not bode well. Eric is essentially saying this  will work because equity holders have a bunch of  

[04:38] tokens. Unfortunately, this has been equally true  in past attempts. The terminal value of the token   is zero. So, you see the theme here. A lot of  people are very bearish on this. The equity side   controls a $70 million a year business, receives  all cash flows, and decides where every dollar  

[04:54] goes. The token side gets whatever crumbs the  equity wants to give out. And he says the equity   is worth a billion. The token is worth 1.5. One of  them is massively mispriced. So, a lot of people   are very bearish on this. There is no defensible  reason to continue with token and equity splits  

[05:12] like this in 2026. I use Venice quite a lot. But  they are saying that the perception is that Venice   is a business growth aligned asset. Whether it  is or not, it is now obvious to token market  

[05:25] participants that Venice is not a first-class  citizen in the Venice Capital stack. Pretty   crazy. And truly only a handful of teams in crypto  that are genuinely trying to push real value into  

[05:39] their token. So, you can see the consensus here.  And honestly, I tweeted yesterday, AI tokens,   I think, are still some of the most investable  tokens in all of crypto. Near Protocol right now   does seem to be probably the best play. Just in  general, we have seen flaws despite how much I  

[05:55] love TA. We have seen flaws in TA's structure,  just to be completely honest and objective. No   bias involved. I think that TA is still going to  rip whenever the time comes, but the sentiment  

[06:08] around it is very negative, still based off  of the Templar situation from last quarter.   Venice is now a little shaky because of the Series  A announcement. So, we are seeing some flaws slash  

[06:20] drama going on in some of these tokens, whereas  Near Protocol right now is just moving along.   Their Near Intents is powering stuff like Zcash.  They are also working with Venice as well. They   are just kind of this infrastructure play on the  AI side that is just kind of chugging along and  

[06:35] does not really have those red flags currently.  But for me, I think in the short to midterm,   this thing is not going to matter. Personally  speaking, I think in the short to midterm, as soon  

[06:47] as the market turns around, you are going to see  Venice pump. I do not think that overall market   participants are going to factor this equity thing  in until longer down the road. I do not think this   is going to tank the token in the short term or  even the midterm. I think long-term could be the  

[07:02] biggest factor here. Let's look at what Ghost  says. I think Ghost is very well respected,   very smart guy, and very objective when it comes  to these things. People who are saying token plus   equity dual tried and failed. That is completely  incorrect. Token first and then equity has not  

[07:18] been tried. It has only been done twice. In fact,  it is much more aligned because the VCs do not   have large supplies of the tokens to dump. And B,  the team only gets funding once they have achieved   product market fit. I do agree at least they sold  this equity after launching the token. The token  

[07:34] is live. Whatever the case is, they have driven a  ton of value to the token over the course of time,   and they already have product market fit. They  already have a ton of revenue coming through   equity. No, they are entirely new asset class best  used for fundraising and a place for valuation on  

[07:54] attention. I do more or less agree with this.  And when I look at Venice, I still think this   is a premier AI altcoin in the short to midterm. I  think the effects of raising money, and especially  

[08:07] if they continue to further raise money in the  future, that is where you are going to maybe   start to see misalignments and this token equity  model fail. I definitely think in the short term,   especially with how hard Eric is on the timeline,  Eric is the founder and CEO of Venice. As hard as  

[08:24] he is out here right now defending the token and  how value is going to be accrued and they are   still going to be burning a ton of the supply, I  think they are going to do everything possible in   the short to midterm to make Venice still look  attractive on a token perspective. So for me,  

[08:39] I am maintaining my investment. I will be watching  closely. My average entry point is about $8. So,   if this thing starts to trend downward or start to  lose strength or more people start to see flaws in  

[08:51] this equity to token split, I might derisk my bag  a little bit or even end up taking profits. But   as of now, I have sold zero dollars of my Venice  position. I plan not to in the short to midterm   because I think when the market bounce does come  inevitably, you are going to see these top tokens  

[09:06] like Hyperliquid, Venice, Near Protocol, the ones  that have been getting all the volume when the   market is hot. I think you are going to see them  all bounce organically. Then we can take a look   at, okay, do we shave some of the bag? Do we take  some profits here? And then over the long term, I  

[09:20] think we will see the effects of this token versus  equity split. But in the short term, I am really   unchanged on this. And with how hard Eric is  defending it, I think they will do everything they   can to keep the token afloat slash also have this  token pump whenever the market presents itself.  

[09:36] So that is what is going on. I think extremely  congratulations to the team. I do not think they   are doing this to harm token holders whatsoever.  I think that Venice's team is one of the most   straightforward and honestly brilliant people in  the space. And if any team can make this work,  

[09:51] it would be them. So, congratulations on the  raise, of course. But I do think there are some   honest questions and conversations to be had as  if does this make the token obsolete or are they   still going to be able to drive enough value  to this token? We will see over the long term,  

[10:05] guys. So, like the video down below, subscribe to  the channel as well, and I will see you guys on   the next video. As always, trade responsibly, my  friends, and of course, stay bullish, my friends.