Panel Discussion Between LongHash, Big Brain Holdings and Dragonfly.
Insights from Raghav (LongHash), Naman (Big Brain Holdings), and Sanat (Dragonfly).
Introduction
At this year’s Denver event, our side event "Meet the OGs"—hosted by Intrakt, Caldera, and Jumper—brought together top-tier VCs to discuss the evolving Web3 investment landscape. Raghav (LongHash), Naman (Big Brain Holdings), and Sanat (Dragonfly) shared insights on how investment criteria have shifted from early philosophical bets to today’s complex evaluations, shaped by market cycles and technological advancements. Let’s dive into the interesting insights shared by these awesome speakers!
How have the criteria for evaluating Web3 companies and projects for investment evolved across market cycles?
Raghav(LongHash)
“The one fundamental thing that remains the same across cycles is the founding team's background and motivation. At pre-seed and seed stages, the biggest factors are the founders' background, motivation, understanding of the problem, execution plan, and flexibility to adapt to changing metas or cycles. While some factors may shift depending on the cycle, the core principles remain unchanged: the team's background, execution ability, and motivation”.
Naman(Big Brain Holdings)
“From 2016 to 2018, crypto was a philosophical space where people invested in its broader benefits. By 2020-2021, during the Layer 1 ICO boom, the focus shifted to projects with unique innovations and faster scaling, though the technology was still evolving. Today, investing is far more complex, considering the team, technology, PMF, and revenue, as crypto now touches many aspects of society”.
Sanat(Dragonfly)
“Crypto founders today are generally better but less "crazy." In 2015-2017, founders were highly skilled but unconventional, while now many come from top universities, drawn by financial opportunities. This shift has increased engineering talent but made it harder to find truly radical thinkers. As crypto attracts prestige-driven individuals, balancing competence with visionary, unconventional founders has become more challenging”.
Besides Crypto AI, what other sectors are you actively exploring for investment or future growth?
Raghav(LongHash)
“A couple of sectors that excite me are payments, DePIN, and gaming. While stablecoins are a product of payments, the real opportunity lies in payment solutions, especially in emerging countries with struggling currencies. DePIN is broad, but interesting use cases, like ownership of health data, are emerging. Gaming, despite not yielding the best returns yet, has a massive consumer base and strong potential for future innovation”.
Naman(Big Brain Holdings)
“I think DeFi is underrated. While stablecoin adoption has grown globally, it's mostly centered around USDC and USDT. There's plenty of room for innovation, especially in a DeFi-native way, with projects like M0 and liquidity layers that better integrate stablecoins into the broader DeFi ecosystem, enhancing liquidity across protocols”.
Sanat(Dragonfly)
“I have two thoughts. First, frontends are an overlooked opportunity—Telegram bots alone generated $750 million in revenue, showing how lucrative a simple 1% vig model can be. Second, despite claims that L1s, exchanges, and stablecoins are fading, history shows otherwise. Every major crypto outcome has been an L1, L2, exchange, or stablecoin. In 2021, many said the L1 premium was dead, yet Solana hit new highs, and Sui became highly valuable. These areas may be crowded, but winning in them brings massive rewards”.
White space in Crypto X AI
Raghav(LongHash)
“AI is still in its early stages, much like L1s, L2s, exchanges, and stablecoins in crypto. There's massive room for innovation. One exciting area is small specialized models—like LinkedIn’s AI hiring agent, which used multiple specialized models instead of one large LLM. Open-source specialized agents are also likely to grow. Another key area is contribution attribution, where platforms like Bagel are making strides. AI agents will become more sophisticated, eventually enabling agent-to-agent commerce, creating vast opportunities for value transfer and utility. Overall, AI remains a vast white space with endless possibilities”.
Naman(Big Brain Holdings)
“I disagree on a few points. Value accrues to users and compute, not the model layer, which is racing to zero unless it captures users. OpenAI makes money from ChatGPT, not just the model. The agent space is overhyped—we won't see millions of multi-agent systems. Yes, they’ll simplify DeFi and bridging, but it's a limited market. AI is subjective, not objective. Design agents need human input, which comes from tooling. AI-enabled applications in crypto are underrated. Autonomous agents won’t replace humans entirely; the human aspect remains crucial for value, even with AGI in the next 5–7 years”.
Sanat (Dragonfly)
“I struggle to invest in Crypto x AI—it’s a sea of bullshit. Much of the occupied space doesn’t make sense. Decentralized compute is a nothing burger, decentralized inference is inefficient, and ZKML’s extra compute cost is unwanted. Smart people saw that crypto, a retail-driven market, wanted AI tokens and capitalized on it. As VCs with a 4-year cycle, very few products make sense. I’m interested in AI agents with money—Fasa was a cool social experiment. We’ve made one Crypto x AI investment, haven't announced it yet, and found everything else lacking. We could be wrong, but that’s how we feel now”.
Conclusion:
This conversation explored the evolution of crypto, AI, and investment trends, highlighting how the space has matured from philosophical beginnings to a more complex, utility-driven landscape. The discussion emphasized the importance of strong founding teams, execution ability, and adaptability across market cycles. While Crypto x AI is a hot topic, skepticism remains about its long-term viability, with many projects seen as hype-driven rather than fundamentally sound. However, certain sectors—like payments, DeFi, specialized AI models, and agent-based commerce—present real opportunities for innovation. Ultimately, while the market is evolving rapidly, success still comes down to building real, valuable products rather than just chasing trends.
Bonus Insight:
Early Web3 founders were bold risk-takers, pushing innovation with unconventional ideas. Today, many come from prestigious institutions, bringing strong execution skills but fewer disruptive visions. While technical talent has improved, the space may lack the outlier thinkers who once drove major breakthroughs. Balancing technical expertise with visionary thinking is key to spotting the next game-changers.