Kite AI’s $18M Series A and the Future of Agentic AI Infrastructure on Avalanche

The recent $18 million Series A funding for Kite AI marks a pivotal moment in the evolution of agentic AI infrastructure, with Avalanche (AVAX) emerging as a strategic backbone for this nascent economy. By combining Kite’s programmable identity and payment systems with Avalanche’s scalable blockchain, the partnership addresses critical challenges in trust, interoperability, and institutional adoption for autonomous agents. This convergence positions AVAX as a foundational asset in the race to define the next phase of AI-driven digital ecosystems.

Agentic AI Infrastructure: A New Frontier

Kite AI’s infrastructure, rebranded from Zettablock, introduces a framework where autonomous agents can authenticate, transact, and operate independently. Its Kite Agent Identity Resolution (Kite AIR) system includes Agent Passport for verifiable identity and Agent App Store for service discovery, enabling agents to execute tasks like AI-powered shopping or logistics management [1]. The platform’s integration with PayPal and Shopify allows merchants to accept on-chain stablecoin settlements, creating a bridge between traditional commerce and decentralized AI workflows [1]. This infrastructure is critical for scaling the “agent economy,” where machine-to-machine interactions drive efficiency and innovation.

Avalanche’s role in this ecosystem is not accidental. Kite’s AI-centric Layer 1 blockchain is built on Avalanche’s Subnets model, which allows customizable, sovereign blockchains tailored to specific use cases. This architecture reduces fees and improves throughput, enabling high-speed data processing for AI workflows [5]. For instance, Avalanche’s consensus mechanism—randomized subsampling and repeated voting—achieves sub-second finality, a necessity for real-time agent interactions [5]. The platform’s institutional-grade scalability has already attracted projects like Wyoming’s FRNT stablecoin and SkyBridge’s tokenized hedge fund, signaling broader adoption [2].

Technical Advantages: Why Avalanche Stands Out

Avalanche’s technical superiority lies in its ability to balance decentralization with performance. The network processes over 4,500 transactions per second (TPS) and theoretically supports up to 300,000 TPS through parallelized Subnets [5]. This scalability is vital for agentic AI, where thousands of agents may simultaneously execute tasks, requiring low-latency coordination. Additionally, Avalanche’s energy-efficient consensus and Ethereum compatibility lower barriers for developers, enabling rapid integration of existing tools [3].

The Proof of Attributed Intelligence (PoAI) mechanism introduced by Kite further enhances this ecosystem. By attributing value to data providers, model builders, and agents, PoAI ensures transparent rewards and incentivizes collaboration [1]. This aligns with Avalanche’s broader vision of a decentralized AI economy, where stakeholders can participate without relying on centralized intermediaries.

Market Positioning and Institutional Adoption

Avalanche’s market positioning is reinforced by its growing institutional footprint. The platform’s infraBUIDL(AI) program, which allocates $15 million to AI innovation, has designated Kite as a key partner, underscoring its strategic importance [4]. Meanwhile, Avalanche’s TVL (total value locked) in DeFi reached $9.89 billion in August 2025, reflecting robust on-chain activity [3]. The U.S. Department of Commerce’s decision to publish GDP data on Avalanche’s blockchain further validates its institutional credibility [3].

Kite’s $18M funding round, led by PayPal Ventures and General Catalyst, highlights the intersection of AI and blockchain. PayPal’s Steve Everett emphasized that Kite’s infrastructure, paired with regulated stablecoins, could unlock agent-to-agent billing and micro-subscription models [1]. This aligns with Avalanche’s mission to attract institutional capital, as seen in partnerships with Visa and the tokenization of $300 million in hedge fund assets by SkyBridge [2].

Investment Thesis: AVAX as a Strategic Play

Avalanche’s unique value proposition lies in its ability to address the scalability and trust challenges inherent in agentic AI. As the global agentic AI tools market grows at a 56.1% CAGR, reaching $10.41 billion by 2025 [3], AVAX’s role in enabling decentralized, programmable infrastructure becomes increasingly critical. The platform’s low fees (reduced by 96-99.9% post-Octane and Etna upgrades) and validator inclusivity (25 AVAX required to stake) further enhance its appeal [2].

For investors, AVAX represents a dual opportunity: exposure to the AI revolution and the blockchain infrastructure underpinning it. Kite’s integration with Shopify and PayPal, combined with Avalanche’s institutional partnerships, creates a flywheel effect. As more agents and enterprises adopt this ecosystem, AVAX’s utility and demand are likely to rise, supported by a growing TVL and on-chain activity.

Conclusion

The partnership between Kite AI and Avalanche is not merely a technological collaboration but a strategic alignment of visions. By leveraging Avalanche’s scalable infrastructure and Kite’s agent-centric tools, the duo is laying the groundwork for a decentralized, machine-driven economy. For AVAX holders, this represents a compelling long-term play, as the agentic AI economy gains traction and institutional adoption accelerates.

Source:
[1] Kite Raises $18M in Series A Funding To Enforce Trust in the Agentic Web [https://newsroom.paypal-corp.com/2025-09-02-Kite-Raises-18M-in-Series-A-Funding-To-Enforce-Trust-in-the-Agentic-Web]
[2] Avalanche (AVAX) Statistics 2025: Trends Unveiled [https://coinlaw.io/avalanche-avax-statistics/]
[3] Kite AI to Launch the First Avalanche L1 Artificial Intelligence Platform [https://www.avax.network/about/blog/kite-ai-to-launch-the-first-avalanche-l1-artificial-intelligence-platform]
[4] The Avalanche Foundation Announces the infraBUIDL(AI) Program Committee [https://www.avax.network/about/blog/the-avalanche-foundation-announces-the-infrabuidl-ai-program-committee]
[5] Kite AI Launches the First AI-Focused Layer 1 Sovereign Blockchain with Avalanche [https://www.thestreet.com/crypto/newsroom/kite-ai-launches-the-first-ai-focused-layer-1-sovereign-blockchain-with-avalanche]