Venice AI becomes a unicorn as AI privacy concerns grow

Funding Milestone

The funding round is Venice AI’s first external capital raise since it launched in May 2024.

Investor Perspective

Source: Erik Voorhees

“Control over intelligence is the defining fight of the coming decade,” Haseeb Qureshi, managing partner at Dragonfly, said on Wednesday. “Whoever owns the AI delivery stack owns a direct window into your interior life. They log all your chats, train on them, and will hand them over when asked. And in the end, they decide the terms on which you'll get to access the most powerful systems humankind has ever built.”

Capital Allocation

Voorhees said the capital will be used to further build out its own data center infrastructure, owning the GPUs that power its platform rather than being forced to rent them at higher costs. The remaining capital will be used to grow its customer base, enter new markets, hire talent and acquire “additive businesses,” he added.

Venice Token rose 6% on Wednesday.

Source: X

Privacy Concerns in AI

The capital raise comes amid mounting concerns over user privacy when using AI models. Earlier this year, lawyers told Cointelegraph that a user consulting an AI for legal matters could have their chat logs used against them in court.

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In February, Ethereum Foundation AI lead Davide Crapis and Ethereum co-founder Vitalik Buterin proposed a way to use zero-knowledge proofs and other methods to ensure that a user’s interactions with large language models are private.

Legal Developments

Conversations about privacy when using AI were stirred again in May, when a proposed class action was filed in California federal court accusing OpenAI of disclosing private ChatGPT user data to Google and Meta. The complaint alleged that OpenAI embedded Meta Pixel and Google Analytics into the ChatGPT.com website, so that when a user sends a query, the website allegedly sends duplicate data to Meta and Google alongside advertising cookies and personally identifiable information, which is then used to target advertisements to the user.

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