Infrastructure is becoming saturated, consumer applications are the next frontier

In recent years, the cryptocurrency industry has continued to pour large amounts of money into new public chains, scaling solutions, and development tools, but the marginal benefits of technological advancements have become weak. Users do not automatically flock in just because "the technology is good enough." What truly creates value today is attention, not the technological architecture.

Liquidity growth has stagnated, and retail investors are absent from the market. The total market capitalization of stablecoins is only about 25% higher than the historical peak in 2021, with recent increments mainly coming from institutions purchasing BTC/ETH for their balance sheets, rather than speculative capital circulating within the ecosystem.

A clearer U.S. policy environment (, such as the Trump administration and the stablecoin legislation ), is expected to unlock a "second wave" of development. This will expand the overall market size and attract Web2 users who are only concerned with usable applications rather than the underlying technological architecture.

The market is rewarding projects that have real use cases and revenue. For example, Hyperliquid( has an annualized revenue of about $900 million), Pump.fun( has an annualized revenue of about $500 million), and Polymarket( has a trading volume of about $12 billion), far surpassing those infrastructure projects that, despite obtaining high financing, lack a user base(, such as Berachain, SEI, and Story Protocol).

The essence of Web2 is the attention economy, where the importance of distribution channels exceeds that of technology. With the deep integration of Web3 and Web2, the cryptocurrency market will also develop in this direction. Consumer-oriented applications will have the opportunity to expand the overall market pie.

The current consumer segments that have reached product-market fit mainly include: trading/perpetual contracts ( such as Hyperliquid, Axiom ), token issuance platforms ( such as Pump.fun, BelieveApp ), information finance and prediction markets ( such as Polymarket, Kaito ), etc.

The next wave of promising sectors includes: one-stop deposit and withdrawal + DeFi super applications, integrating functions such as wallets, banking, yield, trading, etc.; as well as entertainment/social platforms that utilize on-chain monetization ( for exchanges, betting, prize pools, and creator tokens ) to replace advertising models, optimize user experience, and improve creator earnings.

The AI and gaming fields are still in the exploratory stage of product-market fit. Consumer-grade AI applications require safer account abstraction and infrastructure support; meanwhile, Web3 games are still troubled by the "wool party" economic model. A breakthrough may only be possible when a blockchain game that focuses on gameplay rather than crypto elements as its selling point emerges.

Activity is gathering towards a few consumer-friendly chains ( such as Solana, Hyperliquid, Monad, MegaETH ). Investors should focus on the killer applications in these ecosystems and the infrastructure that directly supports them.

When evaluating consumer applications, greater attention should be paid to distribution capability and execution rather than purely technological innovation. User experience, speed, liquidity, and narrative alignment are often key factors determining success or failure. At the same time, projects should be assessed from the perspective of "business" rather than "protocol": examining their real revenue, scalable business model, and clear path to industry dominance.

Pure infrastructure projects are unlikely to replicate the valuation multiples seen in 2021. In the next five years, outsized returns are likely to come from consumer applications that can translate underlying crypto technologies into the daily experiences of millions of Web2 users.