Top Narratives for Tech Investing in 2026

At Arcanum Ventures, we are enthusiastic about the promising tech that we will see in 2026. But before we share our top investment narratives in the tech startup space for this year, we must first start with 2025 to set the stage.

2025 was the Year of AI

If you had to sum up 2025 investments in one phrase, “the AI year” would be the obvious pick.

Anything with “AI”, “model,” or “GPU” in the deck got funded, whether it was actual infra or an autocomplete stapled onto a SaaS dashboard. The S&P 500 pushed out another double-digit gain, about 18 percent on a total-return basis. Meanwhile, emerging markets outperformed everyone, with returns north of 30 percent.

Defense stocks rode geopolitics, small caps woke up for a moment, and the “Magnificent 7” started trading like actual companies, which shocked everyone who thought multiple expansion could be something permanent.

In the meantime, chips, cloud, and infrastructure were the more “boring” but real winners in 2025. NVIDIA’s stock was up about 39 percent in 2025, on top of the previous year’s huge run, backed by fiscal 2025 revenue that more than doubled year-on-year. 

No doubt, 2025 was an unusually eventful year around the globe. Several investment narratives emerged in the tech world, defining the direction for the year ahead, with a set of themes that had received relatively little attention the year before.

While this article is about 2026, it helps to start with what set the stage.

Below is a short recap of some of the biggest tech themes of 2025, shaping the narratives (and constraints) we expect to define 2026.

Tokenized RWAs

Tokenized real-world assets (RWAs) entered 2025 with big expectations. Tokenized RWAs are traditional assets like financial instruments, real estate, or fine art that are represented as tokens on a blockchain.

The promise of RWAs was to move claims around faster than old settlement systems, while opening up the market to a wider net of investors. However, as with most things regarding blockchain, legal uncertainty significantly slowed progress down.

Global regulators also flag basic problems of “what do you actually own”, as investors often do not know if they hold a real claim on the asset or just a digital representation. Liquidity stayed patchy (often propped up by market makers or buybacks). The RWA category as a whole still grew (mostly on tokenized treasuries and funds), however, real estate largely stalled under a pile of securities + property + tax law complexities.

DIDs, Reputation Systems, DAOs

Most online identity today is built around large, centralized databases. These identities live inside platforms you do not control and are reused far beyond their original purpose, which can put you at a security risk. 

Decentralized identifiers (DIDs) are globally unique IDs that are not issued by a single platform. They point to cryptographic keys that you control instead of a record in somebody else’s database. Given how often giant centralized databases have been hacked recently, it is not surprising that DIDs have become a popular talking point in 2025.

As bots got worse, reputation tools (World ID, Gitcoin Passport, Galxe, etc.) became the gatekeepers for grant programs or airdrops, making sure these are not being taken advantage of. DAOs became more popular too, as once you can guess “real human,” you can more effectively gate governance and voting. 

Agentic AIs and On-chain Automation

With AI seeping into every part of tech, agentic AIs and on-chain automation became one of the top 2025 narratives.

These days, AI agents can go beyond recommending trades. Now they can execute them too. That also means having to give up wallet access for these agents to work with, right as AI scams became sharper than ever. Thus, the arms race moved to safer agent infrastructure, prioritizing keeping keys local and logic off the cloud to reduce the blast radius of potential attacks.

Outside crypto, Google rolled out the Agent Payments Protocol in September 2025, an open protocol that lets AI agents initiate card and bank payments using signed mandates, with support from more than 60 payment systems. This move was quite significant as we move towards AI dealing with real money with less and less friction.

DePIN

Standing for “decentralized physical infrastructure networks,” DePIN means using blockchain technology to build and run infrastructure such as wireless networks, storage, compute, sensors, or energy in a distributed way instead of through a single company.

While gaining more traction in 2025, only projects with real use cases and business justifications stuck around. The State of Crypto 2025 data showed that many DePIN networks never took off, paying demand beyond investor-subsidized bootstrapping.

So what did 2025 actually do for 2026? It stress-tested the tech “hype” projects with regulators stepping in, real demand (or lack of it) showing up, and exposing any “demo only” projects.

With that context in place, we can now turn to 2026.

Tech Narratives That Will Make or Break 2026

Before we get into it, this article is for informational purposes only and does not constitute investment advice. Investing involves risk, including the potential loss of capital. You should do your own research and consider your financial situation and risk tolerance before making any investment decisions. 

Now that the boring part is out of the way, let’s look at some of the narratives expected to make some noise in 2026. 

We covered several of these verticals in our 2026 Predictions video on our YouTube channel, so be sure to check out the video in addition to this article.

1. Embodied AI & Robotics

In 2025, you could see the AI story leak into physical work. Embodied AI refers to artificial intelligence that lives in a physical body, meaning that an AI system is put into a robot or device so that it can see the world through sensors, reason about what it sees, and move or act in the physical environment.

Embodied AI (or robots, really) is rapidly becoming commonplace across logistics, manufacturing, food, and retail. Nearly half of the companies in these sectors were already using robots, with many more planning adoption and increasing budgets.

Much of the AI strategy in logistics was to automate dull, repetitive, or hazardous tasks, contributing to the embodied AI market growing from roughly $2.7B in 2024 to $3.2B in 2025.

2026 is About Robots with Actual Jobs

When “robotics” is mentioned, most people tend to focus on humanoid robots. They are not wrong to do so, as these technologies soaked up a lot of the attention in 2025.  So much so that forecasts talk about hundreds of millions of units produced by 2050 and a multi-trillion dollar market, with China pushing hardest on mass production. However, these are not really the robots that you should worry about taking your job. 

A more significant robotics sector is narrow, vertical robots. These are the robots utilized for work that is repetitive or risky, and become increasingly more useful as companies face having to use less space and people.

Agricultural machines for weeding, spraying, harvesting, tote and pallet handlers, and care robots supporting aging populations are becoming the norm. While these systems don’t look futuristic, they solve immediate labor and safety constraints, which is why they’re currently scaling.

Enabling Layers

If 2025 was about getting robots into warehouses and fields, 2026 is about making their operation smarter and more manageable.

Most teams can’t afford large fleets or dedicated testing facilities, so 2026 increasingly revolves around shared infrastructure: cloud robotics platforms and teleoperation systems that let small teams manage a number of machines at the same time. These enabling layers turn robotics into something closer to software, which is more deployable and can be centrally monitored.

Cloud robotics platforms are forecast to grow sharply through the next decade, while teleoperation infrastructure expands as a safety net for autonomy. Together, they function as a testing and operations layer for embodied AI, reducing capital costs and accelerating deployment without requiring every operator to own the full stack.

Robotics in Defense and Space

Similar to 2025, defense and space will continue to rely on embodied AI in 2026. With geopolitical tensions rising, more countries are prioritizing autonomy and space systems as baseline capabilities they should have. Consequently, governments are funding long-term operational deployment of such technologies.

The U.S. increased spending on uncrewed systems year over year, while countries like Australia committed billions to autonomous undersea vehicles with deployments scheduled from 2026 onward. In these domains, embodied AI supports strategic resilience and operational necessity.

2. Prediction Markets Infrastructure

Prediction markets are financial markets where contracts pay out based on the outcome of a future event. For example, whether a policy passes or the outcome of an upcoming election. Participants buy or sell based on their expectations and risk tolerance. As trading activity accumulates, the price reflects a consensus view weighted by capital at risk.

By late 2025, Polymarket and Kalshi dominated the prediction market space, with estimates putting them at roughly 90% of record weekly volume, and total annual turnover across major venues above $13B.

Use cases expanded beyond political bets into hedging, business forecasting, and even crypto governance. 2026 will be an interesting year ahead, with prediction markets starting to behave as a real pricing layer, backed by sustained capital and serious developmental efforts.

Agentic Trading and Hedging on Top of Markets

Anything “agentic” seems to be on trend across tech. The technical framework for automated agents is already in place.

Kalshi offers an API stack pitched for algorithmic trading and risk management, and Polymarket data can now be easily pulled via third-party providers. A new direction of these technologies is treating prediction markets as hedge instruments: agents can monitor many markets, update probabilities, and adjust positions automatically for DAOs, treasuries, or corporates facing event-driven risks like regulation, tariffs, or policy shocks.

New Market Formats and “Prediction-as-Infrastructure”

Market design is widening beyond simple yes/no bets. Platforms are adding multi-outcome and conditional contracts that let traders express more specific scenarios (including linked events), which makes the prices more useful as forecasts.

On-chain, those contracts can be represented as tokens, which means they can be reused elsewhere: bundled into structured positions or used as collateral. They can also be embedded into portfolios across different apps that share the same liquidity.

In parallel, DeFi insurance is experimenting with event-linked payouts, which start to overlap with the same “pay if X happens” logic, hinting at a convergence in instruments even if the markets remain distinct. As regulation opens clearer paths for brokered access, the likely endpoint is prediction markets behaving like infrastructure: an API and data layer that the systems plug into for hedging, decision support, and distribution.

3. Defense and Space Tech

AI-Native Defense and Simulation

By 2026, most defense AI spending is already concentrated in autonomy: drones, counter-drone systems, targeting, electronic warfare, and ISR, in addition to the simulation environments required to train them.

Recent U.S. legislation allocates tens of billions to drones and AI, and the military drone market is on a steep growth curve through the early 2030s. Platforms like Shield AI’s Hivemind are already flying drones and crewed aircraft in GPS- and comms-denied environments, including integration into crewed-uncrewed teaming programs.

AI-driven simulation environments are now standard for rehearsing missions before live deployment, reducing cost and risk while accelerating iteration. Synthetic battlefields and digital twins increasingly sit upstream of real-world operations, making simulation a core dependency rather than a support tool.

Space as Infrastructure

Space activity is moving beyond satellites toward operational infrastructure. This involves servicing, logistics, and debris management in orbit. Northrop Grumman’s SpaceLogistics program is already extending satellite lifetimes through on-orbit robotic servicing, while Astroscale and ClearSpace are preparing multi-client debris removal and servicing missions. European efforts led by the European Space Agency frame these programs as the foundation for routine, sustainable orbital operations.

Sovereign Infrastructure for Allies

Recent conflicts and service disruptions have pushed allies to reduce dependence on single private or foreign providers for critical communications and sensing. Europe and Ukraine, in particular, are prioritizing sovereign and allied alternatives to ensure continuity under political or military pressure.

The EU’s IRIS² initiative aims to deliver secure, autonomous satellite connectivity for government and defense use.

This push is also driving growth in operational-technology security and dual-use innovation. Programs like NATO DIANA are designed to help mid-sized allies field AI, space, and secure-communications capabilities without building everything in-house. The result is a broader move toward allied, interoperable infrastructure rather than isolated national systems.

4. Privacy Tech

You are not really private online anymore. Privacy was a big topic in 2025, and in 2026, we will likely see products and infrastructure continue to be built around privacy.

The Year ZK Becomes the Default Privacy Layer

Zero-knowledge (ZK) proofs moved from research into production in 2025 and are now treated as core infrastructure for scaling and compliance at the same time.

The technology allows a way to prove something is true without revealing the underlying information, e.g., age without a birthdate, or the validity of a financial statement without exposing amounts.

Ethereum ecosystem’s privacy roadmap and related initiatives are explicitly pushing selective disclosure and wallet-level privacy tooling. The Privacy Stewards of Ethereum initiative combined years of PSE research into a multi-year plan that makes privacy a first-class concern across private transactions and cheap proof generation.

Ethereum’s ZK Push Pressures Other Chains

Ethereum’s network effects make its ZK-native privacy roadmap a competitive threat. If privacy becomes a built-in layer on the dominant smart-contract platform, standalone privacy chains have to justify why they don’t have one.

ZK-first systems like Aztec, Iron Fish, Penumbra, and Namada are responding by going all-in on default-private execution and shielded DeFi–essentially arguing privacy can’t be bolted on later but has to be protocol-deep instead.

Privacy Plus Compliance is Where Product-Market Fit Shows Up

Institutions care about ZK because it offers a clean trade. You keep positions and flows private while still proving AML/sanctions compliance. Regulators are also pushing in this direction. Rules increasingly demand tighter controls while making “dump everything on-chain” untenable.

That is why “privacy plus compliance” is the product-market fit here. ZK systems let regulators get proofs and audit trails, while users avoid broadcasting their entire financial history. Older mixer-style privacy does not offer that tradeoff, therefore it keeps getting treated like a liability.

5. Specialized Tokenized Instruments

Tokenized RWAs reached roughly $28B by the end of 2025, with cash-flowing assets now existing on-chain at a meaningful scale. That makes it possible to issue new instruments directly on top of them (such as collateralized note tokens, tranched credit claims, or insurance-linked exposures) rather than just tokenized wrappers of existing products.

This framing has moved into mainstream finance circles, including Davos and the World Economic Forum, where RWAs are increasingly discussed as a bank infrastructure strategy rather than a crypto experiment. Adoption is overwhelmingly institutional. Tokenized T-bill and money-market funds and tokenized gold have seen real uptake, while large banks are integrating tokenized fund units into institutional platforms with high minimums.

Real-estate tokenization remains slow due to structural and legal friction, while insurance-linked instruments are better positioned to scale.

6. Hardware Native AI Assistants

Hardware-native AI assistants run small models directly on phones, laptops, and wearables to handle routine tasks, such as notification triage, summarization, translation, and basic edits, without shipping every request to the cloud.

These technologies offer lower latency and lower costs. From Google’s Gemini Nano on Pixel/Chrome/Pixel Watch to Apple Intelligence’s on-device models across iPhone/iPad/Mac, and Microsoft’s Copilot+ PCs pushing workloads onto NPUs with Windows coordinating CPU/GPU/NPU, hardware-native AI is already scaling fast.

It is a hybrid stack, where simple, privacy-sensitive work stays local, and anything compute-heavy or retrieval-based is still sent to data-center models. Chipmakers like Qualcomm are optimizing for that, but the user experience is still mixed. The “AI PC/phone” label does not yet come as a must-have upgrade.

7. AI for Human Simulation

One of the messiest directions in AI is how well it can mimic social life. As loneliness rises, more systems are being built to offer comfort and companionship. The line between “simulation” and “relationship” is getting thinner.

Researchers are already describing AI companions, caregiving aides, grief mediators, and agents that take on roles we usually reserve for kids, students, trainees, or partners. As Isabelle Castro noted in Utopia in Beta, “AI children” may become a defining idea. Agents are built not just to retrieve information, but to fill social roles within households and care structures.

This same capability cuts both ways. Mental health chatbots already dominate a large share of AI research despite limited clinical validation, and advances in personality modeling and role-playing agents show how convincingly AI can simulate real people.

That capability translates directly into fraud, with deepfakes and voice cloning becoming major tools for scammers. The systems that can simulate a child or companion can just as easily simulate a boss or loved one, making impersonation and liability hard to treat as edge cases much longer.

2026 will likely see regulators trying to step in to set clearer liability rules and force platforms and payment providers to treat impersonation fraud as a systemic risk instead of a user problem.

8. Data Authentication

AI has flooded feeds with convincing fakes and low-grade “AI slop,” and user trust is sliding accordingly.

Surveys like Edelman’s Trust Barometer show fewer than half of consumers believe what they see online, and UNESCO describes a looming “synthetic reality threshold” where ordinary users can’t reliably tell real from fake. Platforms are responding with labels and limited controls (e.g., dialing down AI content), but the experience still feels degraded.

Watermarking helps in theory, but in practice, it’s often invisible once content spreads. Standards like C2PA Content Credentials are gaining industry backing, yet tags are frequently stripped or not surfaced on major platforms, and big tech’s incentives skew toward engagement, not verification.

We expect to see a shift toward platform-level enforcement, with provenance defaults at the CDN and social layer (e.g., Cloudflare serving C2PA credentials, TikTok enforcing tags, Google pairing SynthID with provenance support).

The AI Hype is Here to Stay in 2026

If you had AI news fatigue in 2025, 2026 won’t be a relief.

The hype may cool a bit, but the buildout is still accelerating. AI is becoming a default layer across hardware, logistics, defense, and space, with embodied systems showing up in practical, warehouse-friendly forms and making labor displacement a real, visible issue.

At the same time, AI-generated content and AI-enabled fraud are forcing authentication and privacy out of the “nice-to-have” category. Expect more effort to prove what’s real, and to prove compliance without oversharing. As these systems become easier to measure, prediction markets will keep expanding as a public way to price uncertainty.

In short, 2026 is likely to be another eventful year, and Arcanum Ventures will continue to give space for the conversations that matter. 

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