[DigitalToday reporter Hyunwoo Choo] Binance founder Changpeng Zhao (창펑 자오) warned that many of the AI companies now crowding the market will eventually disappear, regardless of the sector’s growth.

On May 29 (local time), blockchain outlet BeInCrypto reported that Zhao wrote in a post on social media platform X that AI will continue to grow exponentially, but there are too many companies now.

Zhao said most AI companies will be weeded out and that even those that survive will face big price swings. He added that new surviving companies will keep emerging, and that AI could repeat a pattern in which capital floods into an early-stage industry and only a handful become long-term winners.

The comments came as valuations at private AI companies surge. Anthropic on May 28 announced a $65 billion Series H investment round, and its post-money valuation was put at $965 billion. That is almost triple the $380 billion recorded in February. Altimeter Capital, Dragoneer, Greenoaks and Sequoia Capital participated in the round.

Anthropic said its annualised revenue was $47 billion. That is up from $30 billion early this year and $10 billion in annual revenue last year. In the prediction market Jupiter, Anthropic’s pre-IPO valuation was priced at above $1 trillion.

OpenAI was valued at $852 billion after raising a large investment round in March. OpenAI, the developer of ChatGPT, is preparing a confidential S-1 filing with Goldman Sachs and Morgan Stanley, and is seeking an IPO as early as September.

Profitability, however, remains uncertain. Uber CEO Dara Khosrowshahi said in early May that the company is slowing its hiring pace to shoulder AI investment costs. He said it has not yet confirmed clear returns on investment.

Uber Chief Technology Officer Pravin Neapali Naga said in April that the company had spent its entire 2026 budget allocated to Anthropic’s Claude Code and the development tool Cursor in four months. Uber’s chief operating officer also said it has not yet been confirmed whether expanded use of AI tokens leads to improvements in consumer products.

The trend was not limited to Uber. According to data released in February by the U.S. National Bureau of Economic Research, 90 percent of companies said AI had not had a measurable impact on work productivity. OpenAI also projected that annual losses would continue until at least 2028, and that its operating loss in 2028 would reach $74 billion. It also plans to invest $1.4 trillion in data centres over eight years.

More than half of about $2 trillion in future cloud commitments secured by Microsoft, Amazon, Google and Oracle also depends on demand from Anthropic and OpenAI. Anthropic has been discussed as potentially achieving its first operating profit this quarter, but the industry overall is still spending more money than it makes.