DATA shifts blockchain strategy with $30 million Sui deal

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DATA shifts blockchain with Sui deal

Highlights

DATA retires its blockchain after securing a $30 million investment from Sui Foundation, narrowing its focus to AI training data provenance.
Trace, DATA's registry, now logs daily 3–4 million Kled marketplace data contributions, targeting provenance and licensing gaps in the AI dataset market.
Migrating to Sui grants DATA access to decentralized storage and encryption tools, with tokenholders' rights and vesting maintained during the blockchain transition.

Funding move supports narrower AI data plan

As reported by CoinDesk, DATA is retiring its blockchain after securing a $30 million investment from Sui Foundation, a shift that follows the company's June rebrand from Story Protocol and a broader retreat from its original intellectual property licensing ambitions.

Chief executive Andrea Muttoni says the startup spent years trying to cover areas ranging from music royalties to patents and trademarks, but found entrenched industry systems and limited interest from major rights holders in permissionless licensing. He says that experience pushed the company to reduce its scope and concentrate on provenance and rights tracking for AI training data instead of maintaining a full layer-1 network.

The company says much of that strategy now centers on Trace, a registry that records where training data comes from, who contributed it and what usage rights buyers receive. Muttoni says the team concluded that running a separate blockchain added costs tied to engineers, validators, audits and infrastructure, while most of its operational focus was already on a single product.

DATA does not disclose how much remains from the $140 million it previously raised, but Muttoni says existing investors, including a16z crypto, remain involved. He frames the latest move as a continuation of the company's earlier rebrand rather than a fresh pivot.

Trace targets provenance gap in AI data market

Muttoni says the strategy is informed partly by the team's work with Poseidon, an AI data company incubated by Story that collects and processes datasets for model training. He says buyers in that market often have limited ways to verify whether data is original, properly licensed or truly exclusive, including cases where datasets offered as exclusive were also being sold elsewhere.

Through Trace, DATA is trying to create an auditable record for contributors, marketplaces and buyers. When a user uploads a video or voice recording through a participating marketplace, the system creates a receipt that logs when the file was submitted, the contributor's agreed terms and any later licensing or payment events.

Muttoni says Kled, a marketplace that pays people to contribute data, accounts for a large share of activity and is adding between 3 million and 4 million contributions a day, including older records being brought onto Trace. He also says those figures reflect registration volume rather than confirmed sales, and DATA does not disclose how many records have generated licensing revenue.

The move to Sui gives DATA access to tools including Walrus, a decentralized storage platform for holding copies of original files, and Seal, a system for encrypting those files and limiting access to authorized buyers. The company says it plans to migrate its existing token to Sui on a one-to-one basis while keeping its current blockchain operational until the transition is complete, with token holders retaining their rights and vesting schedules unchanged.

Our earlier article on the U.S. AI data center buildout highlighted how soaring financing costs, construction delays, and power constraints are undermining confidence in large-scale expansion plans. We noted that only a minority of proposed projects appear truly credible, as developers face tighter capital markets, local opposition, and grid limits that can derail timelines and returns.

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