CZ's Denial of YZi Labs' External Fundraising and Its Implications for Crypto Infrastructure Funding

Changpeng "CZ" Zhao's recent denial of reports suggesting YZi Labs is preparing to raise external capital has sparked significant debate about the future of crypto infrastructure funding. According to a report by Yahoo Finance, CZ dismissed the Financial Times' claims as “fake news” built on “cooked-up info,” emphasizing that YZi Labs has never pitched external investors or prepared a demo deck since its rebranding in January 2025 'No Demo, No Deck, No Deal’: CZ Rebukes FT Report on YZi Labs^[1]. This denial underscores a strategic divergence between YZi Labs and other major players in the crypto ecosystem, such as Andreessen Horowitz (a16z) and Pantera Capital, which are aggressively expanding their fundraising efforts.

YZi Labs: Internal Growth vs. External Capital

YZi Labs, a $10 billion investment firm and family office for Binance co-founders CZ and Yi He, has opted to prioritize internal growth over external fundraising. The firm's portfolio is heavily weighted toward digital assets (70%), with notable investments in Ethena Labs, Plume Network, and Aptos Labs YZi Labs 2025: Unlocks Avenues For Crypto^[2]. While YZi Labs previously accepted $300 million in external capital in 2022, it returned part of the funds due to excess reserves and is not currently seeking new investors CZ Denies Report Of YZi Labs Raising External Fund^[3]. This approach aligns with CZ's broader vision of maintaining operational independence, as evidenced by his refusal to engage in “external fund-raising discussions” despite regulatory scrutiny and growing institutional interest in crypto CZ Slams ‘False’ Report Claiming YZi Labs Seeks Outside Investors^[4].

The firm's focus on long-term infrastructure projects—such as Ethena's USDe stablecoin and Plume Network's blockchain layer—reflects a strategy of building foundational assets rather than chasing short-term liquidity YZi Labs Invests in Ethena’s USDe Stablecoin^[5]. This contrasts with the broader crypto VC landscape, where firms like a16z and Pantera are leveraging external capital to scale their bets on AI, DeFi, and blockchain innovation.

Broader Trends in Crypto Infrastructure Funding

Q3 2025 has seen a surge in institutional adoption and regulatory clarity, driving robust inflows into crypto infrastructure. According to Grayscale Research, net inflows into Bitcoin and ETH ETFs reached $14.6 billion in Q2 2025, a 20-fold increase from Q1 Grayscale Research Insights: Crypto Sectors in Q3 2025^[6]. Stablecoins, now valued at over $230 billion in total supply, have become critical to institutional strategies, with $47.3 billion allocated to yield-generating mechanisms like lending protocols and liquid staking derivatives Institutional Stablecoin Investment Report: Q3 2025^[7].

Venture capital activity has also rebounded, with firms like Strive Asset Management and TwentyOneCapital securing $750 million and $585 million, respectively, for Bitcoin-focused strategies Crypto VC Funding Surges Past $10 Billion in Q2 2025!^[8]. Meanwhile, projects like Auradine (3-nanometre mining chips) and ZenMEV (MEV-resistant block-building) highlight a shift toward infrastructure with tangible, real-world applications Crypto Fundraising Trends 2025: IPOs, Institutional Flows, and more^[9]. These trends suggest that investors are prioritizing compliance and scalability over speculative bets—a dynamic that YZi Labs' internal growth model may be uniquely positioned to exploit.

Strategic Resilience: YZi Labs vs. a16z and Pantera

Andreessen Horowitz (a16z) and Pantera Capital represent contrasting approaches to crypto infrastructure funding. a16z, which has historically invested in Ethereum and Uniswap, is now raising a record $20 billion AI-focused fund to capitalize on global demand for U.S. tech Andreessen Horowitz to Raise Record $20B AI Megafund^[10]. This megafund, backed by access to 20,000 Nvidia GPUs for portfolio startups, reflects a16z's ambition to dominate the AI revolution while maintaining its crypto roots A16z Unleashes $20 Billion AI Fund Fueled By 20,000 Nvidia GPUs^[11].

Pantera Capital, meanwhile, is targeting $1 billion for its latest fund, Pantera Fund V, with a focus on startup equity, early-stage tokens, and liquid tokens Pantera Capital to Grant Co-Investment Rights to $25M LPs in Fund V^[12]. The firm's recent acquisition of Solana (SOL) tokens from the FTX bankruptcy estate underscores its aggressive strategy to diversify risk while leveraging regulatory expertise Pantera Capital Plans to Raise $1 Billion for New Fund^[13].

YZi Labs, by contrast, has chosen a more insular path. Its $10 billion fund, managed by Ella Zhang, is doubling down on high-conviction bets in synthetic dollar infrastructure and biotech, with no immediate plans to open to external investors YZi Labs Deepens Its Holding in Ethena Labs^[14]. This approach offers advantages in agility and alignment with CZ's personal vision but may limit scalability compared to externally funded rivals.

Implications for the Crypto Ecosystem

CZ's denial of external fundraising highlights a critical juncture for crypto infrastructure. While firms like a16z and Pantera are scaling through external capital, YZi Labs' internal growth model emphasizes control and long-term value creation. This divergence raises questions about the optimal structure for crypto infrastructure funding in a maturing market.

Regulatory shifts, such as the U.S. SEC's engagement with YZi Labs and the passage of the GENIUS Act for stablecoins, suggest that institutional legitimacy will remain a key driver of growth Crypto Fundraising Trends 2025: IPOs, Institutional Flows, and more^[15]. For YZi Labs, maintaining independence while navigating these changes could position it as a resilient player in a sector increasingly dominated by institutional capital.