As AI continues its dominance of corporate attention—and venture capital investment—the once-beloved sector of blockchain has sometimes felt like a spurned child. Still, many crypto proponents argue that blockchain can still solve the most pressing problems posed by AI, from confirming personhood to preventing deepfakes. That's why one startup, Space and Time, is building software to bring the immutability of blockchain to AI applications—and it will have ample resources to build out its vision, with a $20 million Series A led by the crypto-focused venture firms Framework Ventures, Lightspeed Faction, Arrington Capital, and Hivemind Capital.
Space and Time previously raised an earlier $20 million led by Microsoft's M12 Ventures, which also participated in the Series A, in September 2022.
"[We're] moving to an AI-powered world, meaning you don't know what is being generated by AI and what is being generated by a person or corporations," Nate Holiday, the cofounder and CEO of Space and Time, told Fortune in an interview. "We think it's super critical to sit right in the middle of this to ensure that as applications are being built in this new world, powered by Space and Time, you have this verifiability, trust, and transparency."
AI x blockchain
Space and Time's pitch is simple, at least in technological terms. The promise of crypto is that data can be coded directly onto blockchains without the need for intermediaries, meaning it cannot be tampered with or misinterpreted, as long as you know how to interact with it and what to look for. When you send a transaction from one Bitcoin wallet holder to another, there does not need to be a bank or broker sitting in the middle who might misrepresent what happened.
AI, in many instances, is the polar opposite. The applications we have become used to, such as ChatGPT, are black boxes—we ask them a question and get an output, but receive almost no insight into the process and have no way of finding out. This means that, when the answer is incorrect, there is no way of understanding how the agent came up with the would-be solution.
On a high level, Space and Time is tackling that thorny issue of verifiability. Its technology aspires to ensure that when an AI application provides an output, you can confirm where it came from and, ideally, that it's correct. Holiday argues the way to do that is through blockchain, which is essentially just a type of database that is theoretically more immune from human meddling.
Initially, Space and Time pitched its solution just to blockchain firms, positioning itself as a kind of decentralized version of the data storage service Snowflake. In other words, it would serve as a data warehouse, but unlike other crypto-native solutions such as Filecoin, Space and Time would be designed to allow applications to retrieve and access data quickly. That plan proved appealing to companies building in the world of DeFi, which revolves around financial platforms that must store massive amounts of user information that require constant updates, such as lending apps.
Michael Anderson, the cofounder of Framework Ventures, said the Web3 Snowflake analog is what initially drew him to Space and Time, as he realized the use cases could be expanded. He said the idea now is to take the advantages of blockchain verifiability and apply it to non-blockchain-based applications, like traditional financial institutions, which can use blockchain-native tools (namely ZK proofs) to cross-reference third-party data, such as personally identifiable information (PII). For example, if banks and DMVs integrated with Snowflake, Space and Time could help the banks use DMV data to verify someone's age without having to store the data themselves.
AI represents the next frontier. As AI agents begin to complete tasks for us on the internet, such as booking flights, they will need to be able to transact programmatically with rules around using credit cards or verifying that data is accurate. In this future world, Space and Time wants to be the blockchain-native database that new applications, and the AI agents that interact with them, rely on.
Of course, with crypto and AI still both in nascent phases, a lot has to go right for this type of technology to achieve widespread adoption. Still, Space and Time is making enough progress to draw investment from some of the top blockchain venture funds, as well as Microsoft, which is aiming to compete with other so-called hyperscalers like Google and Amazon. Along with its database solutions, Space and Time is also using Microsoft's generative AI products to build blockchain app development tools available to its customers.
"[Space and Time] has real people building real technology, which especially in the blockchain x AI space, is harder to find," said Anderson. "When you see entrepreneurs like them coming in, it makes you excited about blockchain."
