Circle co-founder Sean Neville has secured $18 million in funding to launch a financial institution specifically designed for artificial intelligence, positioning the venture to address what he describes as fundamental limitations in traditional banking systems for AI applications.
What to Know:
- Catena Labs raised $18 million in a funding round led by Andreessen Horowitz's crypto venture arm
- The company aims to build a regulated financial institution operated by AI with human oversight
- The project will utilize stablecoins like USDC as "AI-native money" to enable global transactions
Andreessen Horowitz's crypto and Web3 venture capital division led the investment in Catena Labs, the company behind this initiative, which was announced May 20. Neville, who serves as Catena Labs CEO, envisions a fully regulated financial institution catering to what the company calls the emerging "AI economy," where artificial intelligence agents will require specialized financial infrastructure different from traditional banking systems. The ambitious project aims to create an institution built for both AI agents and human collaborators, with operations managed primarily by AI systems under human supervision.
Traditional Banking Systems "Resistant" to AI Integration
According to Catena Labs, conventional financial systems are fundamentally unprepared for AI technologies and are actively hindering the development of an economy where AI agents participate as economic actors. "AI agents will soon conduct most economic transactions," Neville stated in the company's news release, highlighting the urgent need for financial systems that can accommodate these new participants.
The company's announcement described current global financial infrastructure as "slow, expensive, full of global friction, inflexible and ill-suited to the new opportunities and risks of AI." This assessment suggests that as AI agents become increasingly powerful economic participants, the existing financial framework cannot adequately support their operations or manage the unique risks they present. Catena Labs positions its AI-native financial institution as a direct response to these limitations.
"That's why we're building an AI-native financial institution that will give AI agents, and the businesses and consumers they serve, the ability to transact safely and efficiently," Neville explained in the company's statement. The project represents a significant attempt to reimagine financial systems with AI at their core rather than as an add-on to existing structures.
In conjunction with the funding announcement, the team also released an Agent Commerce Kit (ACK), described as an open-source collection of patterns, components, and emerging protocols designed to verify agent identity. The company indicated that this kit would serve as a foundational building block for their larger financial institution project, potentially addressing one of the key challenges in AI-based financial systems: establishing trusted identities for automated agents.
Stablecoins Positioned as "AI-Native Money"
While Catena Labs acknowledges that AI agents can utilize traditional financial systems and rails, the company argues that these agents gain significant advantages when paired with stablecoins, which they characterize as "AI-native money." The company specifically mentioned regulated stablecoins like USD Coin (USDC) as enabling the near-instant, low-cost global transactions that AI agents require to function effectively across jurisdictions.
"Using AI-native money, agents can unlock new business models and greater prosperity for humans and businesses," the company wrote in its announcement. This perspective suggests that stablecoins could become a critical component of the AI economy, potentially expanding their utility beyond their current applications in cryptocurrency markets.
The connection between Neville's background as Circle co-founder and Catena Labs' focus on stablecoins like USDC, which was created by Circle, represents a natural evolution of his work in the digital currency space. By positioning stablecoins as ideal for AI applications, the company builds on existing financial innovations while creating new use cases for these digital assets.
Despite requests from media outlets, Catena Labs had not provided additional information about the project before publication. The limited details available suggest a project still in early stages of development, though with significant financial backing and high-profile leadership.
Closing Thoughts
Catena Labs' $18 million funding round marks a significant step toward integrating AI deeply into financial systems. By creating an AI-native bank with human oversight and utilizing stablecoins for transactions, Neville's venture aims to build infrastructure that can support an economy increasingly driven by artificial intelligence agents. The project raises important questions about how traditional banking might evolve as AI becomes more prevalent in financial transactions worldwide.