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0G Labs launches up to $35M in pre-seed funding to build modular AI blockchain

As the cryptocurrency space heats up, so does funding for new startups. 0G Labs, a web3 infrastructure company, has raised $35 million in pre-seed funding, the team exclusively told TechCrunch.

If $35 million seems like a lot for a pre-seed round, it is. “To build the underlying technology, we initially wanted to raise $5 million,” said 0G co-founder Michael Heinrich.

0G (sometimes called ZeroGravity) is creating a modular AI blockchain designed to alleviate pain points for on-chain AI applications in the web3 ecosystem, such as speed and cost efficiency. Competitors include Celestia and EigenLayer, which also focus on modularity.

Modularity allows developers to choose the components used to build a blockchain system or application. Just like customizing orders at a restaurant, developers will be able to configure components to best suit their needs.

“Our goal is to now make any blockchain as performant and cheap as a web2 application,” Heinrich said. “That’s the benefit of taking this modular approach.”

In contrast, Ethereum is a monolithic blockchain. This means that the data layer, consensus layer and functionality are completed by only one blockchain. It cannot be taken apart, making it difficult to customize. This core infrastructure needs to be built in order for existing centralized AI technologies to participate, Heinrich said.

When co-founders Heinrich, Ming Wu, Fan Long, and Thomas Yao first came together, they talked to other market participants and found that there was a “clear market signal that this aspect of data availability and data storage was indeed Crucial, not only for scaling blockchain systems, but making on-chain artificial intelligence possible,” Heinrich said. “There is some infrastructure missing, but we are firmly committed to building it.”

Wu and Long are founding team members of the “hybrid blockchain” Conflux Network; Yao is a founding partner of IMO Ventures; Heinrich founded garten (originally named Oh My Green), which provides healthy food and welfare services to the workplace.

Decentralized storage is needed, Heinrich said, and “it needs to be completely decentralized, for lack of a better language.” And the data pipeline needs to be broad enough so that many users can use it simultaneously. “That’s what we achieved: scalability and storage of the model so that we can collaborate with others on the execution layer.”

“The investor community realized this was the key to unlocking the space, so we got a lot of term sheets very quickly,” Heinrich said. “Once we picked Hack VC to lead, the floodgates opened and we got 20 times oversubscribed. We have over $100 million in interest and have partnered with the investors we feel can help us the most.”

Investors from more than 40 cryptocurrency-native institutions also joined, including Alliance, Animoca Brands, Delphi Digital, Stanford Builders Fund, Symbolic Capital and OKX Ventures, among others. 0G declined to disclose its valuation.

Heinrich said that large distributed capped tables are consistent with web3 values. “It’s a community-driven spirit and effort, which is why we decided we should bring in more capital so we could have the right partners.”

The initial funding will be used to hire engineers and build 0G’s market capabilities, community and ecosystem.

As of now, 0G doesn’t have its own token, but “it’s a web3 company,” Heinrich said, “so we will release tokens in the future, but can’t reveal more at this time.”

Focus on high throughput

The chain claims that it is very fast and cheap compared to its competitors. The goal is to focus on high security and throughput, which is the network’s ability to process a large number of transactions on its chain within a specific time frame. Its throughput will be 50 Gbps, compared with 1.5 MBps for competitors, he said.

On-chain AI and gaming require fast data pipelines. Without fast and efficient throughput, costs increase. The current data pipeline “wasn’t fast enough, so we built an ultra-high-performance data pipeline,” Heinrich said.

Over time it hopes to reach “unlimited capacity,” similar to Amazon’s web servers that let developers spin up as many servers as needed, 0G hopes to spin up as many consensus networks as possible. A consensus network brings together all nodes of a blockchain and agrees on a data set.

Reach new use cases

Heinrich said that once the chain is fully operational on the mainnet, which means it is a functional public blockchain, any Web 2.0 application can be built on the chain. The company plans to launch on mainnet in the third quarter of this year.

Heinrich believes that the ideal initial ecosystem members and users are layer 2 blockchains like Polygon and Arbitrum that are focused on scaling the Ethereum ecosystem, as well as high-performance teams that are building decentralized applications that require high bandwidth and There are plans to introduce hundreds of millions of users.

It also plans to enable new use cases and previously impossible features, such as on-chain artificial intelligence, on-chain gaming, and high-frequency decentralized finance (DeFi). 0G claims that the gas cost or fee per transaction is “largely negligible at the moment.”

In turn, this will allow more AI applications to develop and solve larger problems on-chain.

In the short term, it plans to leverage a host of use cases and support “hard-to-solve things,” from deepfake detection in artificial intelligence to building decentralized models and helping with high-performance use cases in blockchain.

“We want it to be a public good, to serve humanity, and it can take many different forms,” ​​Heinrich said.

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