YZi Labs Awaits AI, Biotech Mastery Before Opening to External Capital

YZi Labs, the investment firm spun out of Binance in January 2025, is evaluating the potential to open its fund to external investors in the future, according to its managing partner Ella Zhang. The firm, which currently manages assets for Binance co-founder Changpeng Zhao (CZ) and a small group of early Binance executives, has received consistent interest from external investors seeking to participate in its portfolio. However, Zhang emphasized that the firm is not yet ready to make the transition, citing the need to further build expertise in artificial intelligence and biotechnology before considering external capital title1^[1].

YZi Labs, which oversees a $10 billion portfolio, has previously experimented with external funding. In 2022, the firm accepted $300 million in external capital but later returned part of the funds, stating that the scale of its existing assets under management was already substantial. Zhang described the challenge of deploying such a large capital base, noting the difficulty in identifying sufficient high-quality investment opportunities across crypto, AI, and biotech. The firm’s current focus remains on refining its internal capabilities and maintaining a long-term investment horizon, with no immediate plans to launch a public fund title2^[2].

The regulatory environment in the United States has also influenced YZi Labs’ considerations. Zhang highlighted the Trump administration’s more open-minded approach to cryptocurrency regulation, including the Securities and Exchange Commission’s (SEC) recent request for a private demo of YZi-backed projects. SEC Chair Paul Atkins, who took office in April 2025, has been vocal about fostering innovation in the crypto sector, a shift that Zhang described as encouraging for U.S.-based crypto entrepreneurs. This regulatory climate may ease future regulatory hurdles if YZi Labs eventually opens to U.S. investors title3^[3].

CZ, who resigned from Binance in 2023 after serving a four-month prison sentence for AML violations, remains the exchange’s largest shareholder. His post-Binance ventures, including YZi Labs, have faced scrutiny over compliance and risk management. Despite these challenges, YZi Labs has expanded its portfolio to include over 230 companies, spanning crypto infrastructure (e.g., LayerZero, CertiK), Web3 projects (e.g., Aptos Labs, Polygon), and AI/biotech firms. The firm’s strategy emphasizes long-term value creation, with a focus on early-stage investments in disruptive technologies title4^[4].

The potential move to accept external investors aligns with broader trends in the crypto-native investment landscape. Galaxy Digital recently raised $175 million for its first external venture fund, exceeding its $150 million target. Analysts suggest that institutional demand for crypto-focused funds is growing, particularly as regulatory clarity improves. YZi Labs’ decision to delay external fundraising reflects its cautious approach, prioritizing operational readiness over immediate capital expansion. Zhang reiterated that the firm will act only when its expertise in AI and biotech reaches a level that justifies external confidence title5^[5].

YZi Labs’ strategic evolution underscores the evolving role of crypto-native funds in bridging traditional and digital finance. Its investments in infrastructure projects, such as Ethena’s USDe stablecoin and BNB Chain integrations, highlight its focus on scalable financial tools. While the firm’s openness to external capital remains conditional, its current trajectory signals a measured but ambitious expansion into new asset classes and markets. The outcome of its regulatory interactions and internal development will likely shape its future as a key player in the crypto ecosystem title6^[6].