Consumer Applications: The Next Frontier of the Crypto Market

After years of investment in new public chains, scalability solutions, and development tools, the infrastructure of the crypto industry has become saturated, and the marginal returns of technology are decreasing. Simply relying on technological innovation can no longer automatically attract users. The key to creating value now lies in capturing attention, rather than optimizing architecture.

Market liquidity is stagnant, and retail participation is insufficient. The total market capitalization of stablecoins is only about 25% higher than the historical peak in 2021, with recent increments primarily coming from institutions purchasing BTC/ETH for their balance sheets, rather than speculative capital circulating within the ecosystem.

Core driving forces for future development:

1. A friendly regulatory environment will unlock the "second wave" of development. The U.S. policies are gradually becoming clear (, such as the new government's stance, stablecoin legislation, etc. ) will expand the market size and attract more Web2 users who are only concerned with practicality rather than underlying technology.

2. The market favors projects with real use cases. For example, Hyperliquid( with an annualized revenue of approximately $900 million), Pump.fun( with an annualized revenue of approximately $500 million), and Polymarket( with a trading volume of approximately $12 billion), these projects significantly outperform infrastructure projects that are overvalued but lack users.

3. With the deep integration of Web3 and Web2, the crypto market will be more similar to the attention economy, and applications aimed at end users will become the main players.

Currently realized products and market-matched consumer tracks ( encryption native ):

• Trading/perpetual contracts ( such as Hyperliquid, Axiom )
• Project issuance platform/meme coin factory ( such as Pump.fun, BelieveApp )
• Information finance and prediction markets ( such as Polymarket, Kaito )

Future potential track ( Web2 derivatives ):

• One-stop encryption financial super application: integrates wallet, banking, yield, trading and other functions, providing an experience similar to Robinhood but without ads.

• Entertainment/Social Platform: Use on-chain monetization ( for exchanges, betting, prize pools, creator tokens, etc. ) to replace advertising models, optimize user experience, and improve creator earnings.

AI and the gaming sector are still in their early stages. Consumer-level AI applications require more refined account abstraction and infrastructure; Web3 games are troubled by the "wool party" economy. We need to wait for works that truly center on gameplay rather than encryption elements to break through.

Superchain Trend: Activity is positively concentrated on a few consumer-friendly public chains such as Solana, Hyperliquid, Monad, MegaETH (. Investors should pay attention to the killer applications in these ecosystems and the infrastructure that directly supports them.

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Key Perspectives on Investing in Consumer Applications:

• Distribution capability and execution ability are more important than pure technology) Consider network effects, viral spread, and brand influence(
• User experience, speed, liquidity, and alignment with current market narratives are key factors determining success or failure.
• Should be evaluated from the perspective of "enterprise" rather than "protocol": focus on real income, scalable business models, and clear industry-leading pathways.

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Summary: Pure infrastructure projects are difficult to replicate the valuation multiples of 2021. In the next five years, excess returns will come from consumer applications that can transform encryption technology into the daily experiences of millions of Web2 users.

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