Crypto-AI startup 0G Labs raises $40 million seed and receives $250 million token purchase commitment

Zero Gravity Labs (0G Labs or 0GL), a crypto-AI startup developing infrastructure for a decentralized AI system, has announced $290 million in new funding. This includes a $40 million seed round raised by the Labs and a $250 million token purchase commitment received by the 0G Foundation, the independent governance body for the 0G Protocol.

Investors include Hack VC, Delphi Digital, OKX Ventures, Samsung Next, Bankless Ventures, Animoca Brands and its co-founder Yat Siu, Polygon and its co-founder Sandeep Nailwal, Stanford Blockchain Fund, Abstract VC, Alchemy, Blockdaemon, Foresight Ventures and many others, 0G Labs said Wednesday. It did not specify which investors participated in the seed round and which provided the token purchase commitment.

0G Labs began its fundraising efforts in September and closed the process earlier this month, Michael Heinrich, co-founder and CEO of 0G Labs, told The Block. Heinrich said that the $40 million seed round was structured as a simple agreement for future equity (SAFE) with token warrants, "with the highest SAFE valuation cap exceeding $2 billion."

Regarding the $250 million token purchase commitment, or "liquid line," Heinrich said that it will allow the 0G Foundation to access funds from the balance sheet of a long-only investor that only holds liquid 0G tokens (meaning tokens available on exchanges) at a predetermined discount to the market token price. "So this is very similar to an over-the-counter (OTC) deal, but different from a standard venture capital (VC) investment where you receive all the money upfront from an investor in a non-liquid (non-market traded) token," Heinrich said.

He declined to comment on the 0G token's fully diluted valuation.

The newly announced $290 million in funding brings 0G Labs' total funding commitment to $325 million. The project raised $35 million in a pre-seed funding round in March of this year.

What is 0G Labs?

0G Labs now describes itself as a crypto-AI startup, shifting away from its previous narrative of being a modular blockchain or data availability (DA) layer. "The previous narrative didn't capture our full mission of building AI as a public good… DA is just one component of the puzzle, as is verifiable inference, training, etc.," Heinrich said.

0G Labs is building what it calls a decentralized AI operating system (dAIOS) that aims to enable the development of AI applications onchain.

"Unlike traditional closed AI systems that centralize control, the 0G Protocol empowers users with full autonomy, ensuring privacy, verifiability and censorship resistance," 0G Labs claims. "With breakthrough speeds of 50 GB/second — 50,000x faster and 100x more cost-effective than competitors — 0G's infinitely scalable DA, storage and verifiable AI service framework are making fully onchain AI a reality."

0G's dAIOS has three main components : the service marketplace, the compute and storage network and the DA layer. The service marketplace connects developers and AI service providers in a decentralized peer-to-peer marketplace. The compute network features a decentralized storage tool optimized for large datasets and AI models. The 0G DA layer is a scalable data availability layer that ensures distributed access and verification for onchain data, 0G Labs said.

0G protocol's mainnet and token launch timeline

Heinrich said the 0G protocol's mainnet launch is expected in the first or second quarter of next year. Initially scheduled for July of this year, the launch was delayed because 0G wanted to release the token alongside the mainnet and decided not to separate the two events due to the complexity of managing a mainnet without a live token, Heinrich said.

0G Labs currently employs around 40 people, Heinrich said, adding that with fresh funding in place, he plans to double the headcount by hiring across functions, including engineering and ecosystem growth.

"We'll drive ecosystem growth through initiatives such as developer incentives, hackathons and community-building programs to foster innovation and engagement globally," Heinrich added.

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