Crypto-AI funding just surged 10x, but here’s why the market isn’t convinced yet

There's a gap between private funding and public market performances.

Written by Samyukhtha L KM

Reviewed by Jibin Mathew George

Updated 01:30 EDT June 11, 2026

Crypto-AI funding just surged 10x, but here's why the market isn't convinced yet

AI has become one of the most talked-about themes in the market. Even though AI tokens have not had the strongest year so far, funding has never been higher.

Here’s what you need to be aware of.

Crypto-AI funding hits $600 million!

According to CryptoRank data, AI-related crypto projects have now raised more money for five straight quarters. In Q2 2025, the sector saw around $60 million in funding. In Q2 2026 so far, that number has reached $600 million.

That is a mammoth 10x jump in one year, even before the quarter has ended! Investors still clearly see long-term potential in the space.

AI tokens still down

Now, here’s where it gets interesting. Artemis data revealed that the AI sector was down 8.1% YTD, based on fully diluted market capitalization. That puts it in the red, even though investments in AI-focused crypto projects have kept increasing.

This implied that private investors have been backing the long-term potential of the sector, while public markets still sleep with an eye open.

Here’s another POV – Researchers recently warned that the crypto-AI narrative may be running ahead of its real-world utility. In fact, a recent academic survey argued that a meaningful integration between AI and crypto is still only in its early stages.

An important distinction can also be made – Some projects use AI to improve crypto systems, while others use blockchain to build AI infrastructure. What’s critical about it is the inference that not every token under the AI label is solving the same issue, nor do they have the same economic strength.

A very selective AI token rally

Despite sector pressure though, a few tokens have stood out lately. Siren [SIREN], for instance, was up nearly 28% over the past week, while Allora [ALLO] surged over 130%. Unibase [UB] also gained by around 25%.

Some strong narratives have gained user favor. But not all.

Larger names like Artificial Superintelligence Alliance [FET] and Virtuals Protocol [VIRTUAL] were down in the same timeframe. Simply put, the prevailing market is pretty selective.