Decentralized AI infrastructure provider Kite AI raised $18 million in its Series A funding round led by PayPal Ventures, bringing total cumulative funding to $33 million.
According to an announcement shared with Cointelegraph on Tuesday, other investors in the company include 8VC, Samsung Next, SBI US Gateway Fund, Vertex Ventures, Hashed, HashKey Capital, Avalanche Foundation, LayerZero, Animoca Brands and more. In February, Kite launched the testnet of its AI-centric layer-1 blockchain, based on Avalanche (AVAX), aiming to enhance scalability and data processing while providing centralized coordination for artificial intelligence (AI) workflows.
Kite aims to leverage distributed infrastructure to power agentic AI infrastructure, envisioning AI agents as a new user category in the Web3 ecosystem. AI agents are autonomous software programs that can perceive their environment, make decisions, and take actions to achieve goals without constant human intervention.
Kite launched AIR, a system that allows AI agents to authenticate and transact independently with programmable identities, native stablecoin payments and policy enforcement on a dedicated blockchain. AIR comprises two components: an Agent Passport, which provides identity services with operational guardrails, and an Agent App Store, which offers agents custom services, data sources and commerce tools, and allows them to pay for these services.
A Kite representative explained that Passport “creates a multi-layered identity system where each participant—users, agents, and sessions—has distinct cryptographic identities that form a chain of trust.” This purportedly ensures that all actions can be cryptographically traced back to the point of origin.
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AI agents as Web3’s user interface
Kite co-founder and CEO Chi Zhang explained that the team believes autonomous agents will be “the dominant [user interface] for the future digital economies.” He said that to function, such agents need structured and verifiable data, and providing that was the first step. Now it is time for identity, trust and programmable payments that are purpose-built for AI agents:
Zhang said that using publicly available application programming interfaces (APIs), PayPal or Shopify merchants “can opt in through the Kite Agent App Store and become discoverable to AI shopping agents.” Purchases made in this ecosystem are settled onchain and transparent, leveraging stablecoins. The team is working on additional integrations across commerce, finance and data platforms.
Talking to Cointelegraph, a Kite representative explained that “PayPal is a formal partnership in pilot phase, Shopify is an API integration in pilot phase.”
Alan Du, partner at PayPal Ventures, said Kite is “the first real infrastructure that is purpose-built for the agentic economy.” He added that payments are a challenging technical gap for AI agent systems and “Kite bridges this critical gap by providing stablecoin-based, millisecond-level settlement.”
Steve Everett, head of global market development at PayPal’s crypto and digital assets department, said such systems allow for “a truly global, automated economy where people, enterprise and machine can interact with ease and trust.”
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Growing expectations for AI agents in Web3
Enthusiasm for AI agents capable of handling crypto transactions and Web3 interactions is steadily growing. Coinbase development team members Kevin Leffew and Lincoln Murr recently said that such agents are about to become Ethereum’s “biggest power users.”
Still, how AI agents interact with other systems fundamentally differs from how humans interact with them, and their capabilities significantly differ from those of the average human. For this reason, considerable effort is being invested in developing purpose-built infrastructure and middleware that enables AI agents to interact with complex systems, including Web3 infrastructure.
Adrian Brink, co-founder of Web3’s AI agent infrastructure firm Anoma, recently argued that such systems require intent-based blockchain infrastructure. In this context, intents are user-defined goals or desired outcomes expressed at a high level, which blockchain and agent systems interpret and execute by automatically determining the necessary actions and transactions.
Some AI-agent-based systems are already seeing large-scale adoption in Web3. Data from earlier this month shows that Clanker, a decentralized application (DApp) built around an artificial intelligence agent that creates memecoins based on prompts, has generated over $34.4 million in fees for its users.
“Clanker is an AI that launches crypto tokens for you,” the DApp’s website said. “Give it a name and symbol, and it handles deployment, market creation, and fee sharing automatically.”
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Source: https://cointelegraph.com/news/paypal-ventures-backs-kite-ai-with-18m-to-power-ai-agents?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
