Web3 was defined by Crunchbase as cryptocurrency and blockchain startups, which have been hit hard by the ongoing crypto winter. While VC funding has slowed overall, with Crunchbase reporting an 18% drop across all sectors in the second quarter of 2023, crypto-related funding has had a much steeper decline. Meanwhile artificial-intelligence (AI) startups have become the new shiny object for investors, seeing $25 billion in funding in the first half of 2023.