Anthropic's $65B round and OpenAI's IPO prep set up Zhao's warning. The S-1 filing will test if valuations hold or reset across the AI sector.
Anthropic closed a $65 billion Series H funding round, lifting its post-money valuation to $965 billion. The round ranks among the largest private technology raises in history. OpenAI holds an $852 billion valuation after its March funding round and is preparing a public market debut with Goldman Sachs and Morgan Stanley as underwriters.
Former Binance CEO Changpeng Zhao said most AI companies will fail despite explosive growth. The statement lands at a moment when private valuations have detached from public market conventions. Zhao built one of the most profitable crypto exchanges from near-zero revenue and watched competitors collapse during previous hype cycles. His argument rests on the idea that AI platform differentiation is temporary and that many business models depend on sustained cheap capital.
The better market read starts with capital structure. Anthropic's $65 billion raise is equity, not debt. Investors expect a future exit above the current valuation or a dividend path. The underwriting mandate for GS and MS on the OpenAI IPO means banks are already modeling demand schedules and lockup terms. If Zhao is correct, the IPO window could close before weaker players reach the public market, leaving those companies with no refinancing path.
For institutions allocating to the crypto market, Zhao's warning carries a direct analogy. The 2021 bull run produced dozens of layer-1 tokens with billion-dollar valuations that later collapsed when liquidity tightened. Bitcoin (BTC) and Ethereum (ETH) survived because they had network effects and decentralized validator sets. The AI company landscape currently lacks that structural moat. Most large model companies rely on the same few chip suppliers and the same open-source architectures, which means marginal improvements are quickly cloned.
AlphaScala's proprietary scoring reflects moderate conviction in both lead underwriters. GS carries an Alpha Score 64/100 (Moderate) within the Financials sector. MS holds an Alpha Score 61/100 (Moderate). These scores suggest the banks are not positioned as high-conviction trades ahead of the OpenAI listing. They should still benefit from underwriting fees regardless of how the secondary market prices the stock.
The next concrete decision point is the OpenAI S-1 filing. The document will reveal the underwriter discount, share registration size, and whether existing investors plan to sell alongside the company. If the valuation exceeds $900 billion at pricing, Zhao's failure prediction becomes a short-term contrarian trade. If the IPO prices below the last private round, it will confirm his thesis and reset valuations across the sector.
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Prepared with AlphaScala research tooling and grounded in primary market data: live prices, fundamentals, SEC filings, hedge-fund holdings, and insider activity. Each story is checked against AlphaScala publishing rules before release. Educational coverage, not personalized advice.