by Tal Elyashiv, founder and managing partner of Spice VC and author, “Investing in revolutions: creating wealth of transformational technological waves’
Today’s world is on sharp. From the American -China competition and the volatility of the Middle East to growing calls for tax cuts, the geopolitical landscape is more broken than at any time in the last three decades. It is understandable that investors are nervous. Markets are volatile. Private Equity companies are on a trillion dollar in dry powder. Daring capital Deal counts have fallen by 25% in Q1 2025 (excluding megadeals such as OpenAI). And even institutional investors are cropping exposure to emerging technology.
But here is the paradox: Although these forces can slow down the investments in certain areas, they often act as accelerators – not inhibitors – for the acceptance of transformational technology. That is the historical pattern in every important technological revolution we have seen. And we see it again with what I call the quantum revolution – the convergence of blockchain, ai, quantum computing, robotics and autonomous systems.
While I write in “Invest in revolutions”,” “Geopolitical speed points, far from stopping innovation, have consistently served as focus mechanisms. They reveal inefficiencies, surface national vulnerabilities and catalyzes strategic investments in capacities that were previously optional. “
This moment is no different.
The past is a prologue
Every earlier revolution – steam and mechanization, electrification, mass production and the digital era – was born, aged or accelerated under geopolitical stress. The Napoleonic wars Supercharged the British industrial dominance. The US arms race pushed the US to invest in Darpa, semiconductors and space infrastructure. The internet itself follows its origins to Arpanet, a defense initiative born of military fear.
This is no coincidence. While countries threats are confronted for their sovereignty or economic benefit, they invest – urgently and on a scale – in technologies that can create asymmetrical benefits.
Consider ai. In the aftermath of the Russian invasion of Ukraine and the growing assertiveness of China around Taiwan and semiconductors, Western democracies have invested investments in AI-driven defense technologies-drone swarms, battlefield intelligence platforms. NATO itself has launched an innovation fund of € 1 billion aimed at emerging technology. In the meantime, the US Chips and Science Act has permitted $ 52.7 billion for production and research by semiconductors – a direct response to observed over -dependence in East Asia.
As the historian Margaret O’Mara wrote in “The code”,” Silicon Valley did not only come from garages and risk capital – it grew from federal editions, defense contracts and urgency of the Cold War. “That pattern repeats itself.
Investors pause – but not the entire market
Yet recent events have led real hesitation. Family agencies and institutional LPs are becoming more careful. A recent BlackRock research showed that 84% of family agencies mention geopolitical uncertainty as their best allocation problem, with almost half of cash and alternatives.
In private equity, almost three-quarters of the general partners say that global tensions and rates postpone their bet plans, according to a PWC report. In risks, financing has fallen – especially in sectors such as blockchain and consumer tech. Business Insider recently reported that “De Hoop for a Rebound of 2025 BC was dimmed”, partly due to bottlenecks and macro instability.
But that doesn’t mean innovation stops. It shifts. Capital flows to defense technology, cyber security, AI infrastructure and Kwantum R&D. Even with cautious investors, 33% say they intend to increase the exposure to risks against the end of 2025 (PGIM). The lesson? Capital has been brought back into balance and is not recingent.
The weapon race of the next generation is already underway
What now pops up is a split global tech stack. On the one hand, the US, Europe and allies consolidate standards for familiar chips, cloud infrastructure and AI safety. On the other hand, China and aligned economies insist on sovereign control over their digital, financial and quantum infrastructure. As I note in the book: “The internet is no longer one network – it is much, each embedded with values, controls and dependencies of the governments behind them.”
The implications are huge. Quantum Computing threatens to make today’s coding outdated, foring to compare governments and companies to prepare for a security landscape after the Kwantum. In the meantime, Blockchain is becoming a geopolitical tool: Russia and Iran are actively investigating crypto rails and decentralized grandbooks to bypass Western financial sanctions and rapid restrictions, while the Brics countries (Brazil, India, China, South Afrika, South Africa and have announced Southern Africa and Southern Afrika and Southern Africa and Southern Africa and South Africa Blockchain payment systems to reduce the US dollar already transforms military intelligence operations to advanced disinformation campaign Chokpoints-geïllustrated by China’s urge to smart factories and the call from the US Department of Defense of autonomous vehicle contracts.
This geopolitical rivalry is not a share – it is the central power that forms how and where the quantum revolution unfolds.
Government spending: accelerator or brake?
There is one threatening risk that this momentum can slow down: domestic political paralysis. In the US, proposed federal cutbacks, including reductions of R&D and subsidies to national science agencies, can threaten the leadership of America. Although Defense expenditure can remain intact, it requires broader scientific innovation of fundamental AI research to quantum cryptography-durable public-private partnership.
A report from Brookings Institution warns that “decreasing federal R&D investments as a share in GDP risks risks risk to reduce innovation leadership from competitors.” In the meantime, China has announced plans to spend almost $ 1.4 trillion on AI, semiconductors and smart production over the next five years.
In a world where technological leadership defines geopolitical power, the withdrawal of public investments would be a strategic error.
So what should investors do?
First remember this: Revolutions are long games. Volatility in the short term may not cover up the long -term value creation. As I wrote in “Invest in revolutions”,” Revolutions happen gradually, then suddenly. The key must be placed before the bending point – not afterwards. “
This is not the time to give up emerging technology. It’s time to refine your thesis. Be distinctive. Focus on areas where geopolitical urgency is in accordance with investment steel wind: AI-driven defense systems, coded quantum networks, smart factory automation and decentralized financial infrastructure.
It is also important to follow the leadership of major players. Microsoft, Alphabet, Meta and Nvidia invests aggressively in fundamental models, adapted chips and global cloud infrastructure. Amazon integrates robotics and generative AI into its logistics networks. These are not bets – they are blueprints.
And although blockchain companies can be confronted with temporary headwind in broader venture circles, tokenization of real-World assets (RWAS) gets quietly powerful traction-especially among leaders of institutional finances. Blackrock’s access to tokenized funds is a clear signal: blockchain infrastructure is mature and evolving the use cases from speculatively to structural.
At Spice VC we have long been convinced that Blockchain’s most sustainable impact is not in Hype -Cycli, but in his authority to re -wirer how financial assets are spent, traded and arranged. That thesis is validated time and time again. The first toppingized VC Fund has now carried out its third investor payment, with a DPI of more than 2.1x and TVPI above 6.3x-beter than even top-decile VC benchmarks. These results underline a wider truth: although the noise can move, the signal – the underlying value of transformative technology – remains strong.
This institutional shift to tokenization is not a detour from the revolution. It is one of the most important milestones.
Last thoughts: History rhymes
Geopolitical stress tests tests technology. It reveals the strategic value of capacities that once seemed like. In the 1940s, Radar and Codarbreaking the Second World War Reformed and Codarbreaking. In the 1980s, the Space Race fed through in computer use. Nowadays, the drone AI, quantum coding and decentralized financing that can define the contours of power.
The quantum revolution does not slide – it is formed. Investors who understand the deeper currents – not only the headlines – will be best positioned to catch his benefit.
As I conclude in the book: “You don’t have to predict the revolution. You have to understand the pattern. Once you do that, you will see that even in times of chaos the process of transformation rarely bends back.”
Tal Elyashiv is the founder and managing partner of Spice VCThe best performing blockchain venture capital fund. He distils decades of venture capital investments and technical entrepreneurial experience on usable insights. In his new book, “”Invest in revolutions“Elyashiv uses lively examples and practical frameworks to not only reveal how these transformations unfold, but also how they can identify and benefit from it.
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