Venture capital firm Paradigm has closed its third fund at $1.2 billion, signaling an expanded investment mandate beyond its cryptocurrency origins. The firm, founded in 2018 by Matt Huang and Fred Ehrsam, aims to target startups at the "technical frontier," now encompassing artificial intelligence and robotics alongside its continued focus on crypto.

This strategic shift reflects the surging interest and investment in AI, a sector that has overshadowed the more volatile cryptocurrency market in recent years. Paradigm plans to maintain its commitment to blockchain technologies and financial system reinvention, citing ongoing projects in areas like blockchain tools and security. However, the firm acknowledges significant opportunities in AI and robotics, with Alana Palmedo noting that "there’s so much else happening right now that’s pretty hard to ignore."

The new fund, Fund III, has already backed companies such as drone delivery service Zipline and space startup True Anomaly. The fundraising effort was slightly below the $1.5 billion initially sought, according to prior reports. The move positions Paradigm to capitalize on emerging technological trends, potentially influencing the competitive dynamics within the AI and robotics venture capital space.