YZi Labs has invested in USD.AI, a protocol that offers hardware-backed financing for AI infrastructure.

The investment supports USD.AI’s plan to create a new stablecoin that grows with global compute demand, enabling every operator to act as a hyperscaler.

USD.AI provides loans secured by physical AI hardware rather than relying on cashflow projections.

According to the company, this approach allows for loan closures within seven days, which is faster than traditional credit funds.

USD.AI reported reaching over US$62 million in total value locked (TVL), and announced partnerships with firms such as K3 Capital, Concrete, Euler, and Pendle.

Financial details of the investment were not disclosed.

🔗 Source: YZi Labs

🧠 Food for thought

1️⃣ Funding concentration creates clear market opportunity for alternative financing solutions

The AI funding landscape demonstrates a stark “winner-takes-most” dynamic that validates USD.AI’s market opportunity.

In 2025, just 38 companies raised $100 million or more in AI funding, totaling approximately $56 billion, with OpenAI alone securing $40 billion, representing over 70% of total funding1.

This extreme concentration leaves most AI companies structurally underfinanced, creating exactly the capital access problem that hardware-backed financing aims to solve.

The selective investment approach favoring companies with proven technology and clear monetization paths means smaller AI infrastructure builders struggle to access traditional venture capital1.

This funding bottleneck becomes particularly problematic for hardware-intensive AI companies that need substantial upfront capital but lack the cashflow projections that traditional lenders require.

2️⃣ Asset-backed lending fills a critical gap in AI infrastructure financing

USD.AI’s hardware-backed approach addresses a fundamental mismatch between AI infrastructure needs and traditional lending models.