Opinion: Hata Sheikh, founder of Coin Terminal
Although Blockchains and DAPP are critical, stakeholders from the cryptocurrency industry often prioritize applications based on adoption principles and distribution of revenues. DAPPS will not work without their basic chains. Markets must maintain blockchains to generate long -term value.
The prospect of values is incorrect
Blockchains and TAPPS should cooperate to coordinate their functions for better usefulness. Instead, analysts form binary between chains and DAPP based on structural frames of Web2.
In “Fat Protocols” Joel Monegro he argued This value in the internet pile includes “thin” protocols and “thick” applications. In other words, investing in basic protocol technologies, such as TCP/IP, HTTP and SMTP, provides lower phrases than applications such as Google and Facebook.
Monegro also stated that the value is reversed in the “Blockchain application”. The basic layer of the protocol accumulates more value than the application layer, leading to “thick” and “thin” applications. Later published An updated region in order to explain the “success of the application layer as a requirement for growth of the protocol” and how capturing the value depends on the total addressed market.
Because applications become more popular, they attract users to the basic blockchain who operate the chain token to interact with the application. Such a pressure of demand causes an boost in the price of a token and ultimately builds a robust network in which blocks records the maximum value.
Recent research report He showed how the parameters of generating revenues, such as onchain fees, can reverse the thesis of Monegro.
In 2024, Blockchains controlling 70% of the total capitalization of the cryptographic industry market (excluding Bitcoin and Stablecouins) earned $ 6 billion in fees. Meanwhile, DAPPS, with only a 30% market share, earned $ 3.3 billion, generating 35% of total fees at Onchain. This trend lasts in the first quarter of 2025, because DAPPs recorded $ 1.8 billion in total fees compared to $ 1.4 billion for blockchain.
According to the report, the applications generate the actual value and interaction of the user, because higher fees reflect the increased indicators of operate. Because nobody logs in to the application just to access blockchain, people operate trade, play, investing, social gatherings and spending time. In this way, applications generate the value and possibilities of revenues.
Because applications are the first layer of user interaction, they have higher requirements and more height channels. The report says: “Blockchains could build roads – but applications build cities.”
Last: Each chain is an island: a cryptographic liquidity crisis
But without “roads”, you cannot move and access “cities”. “So such a lens of values to assess whether markets prefer chains or applications is a short -sighted perspective.
Analysts and veterans of the cryptographic industry must understand the key role of blockchain in conducting the cryptographic industry. Therefore, cryptocurrency markets must always support blockchain, regardless of their economic potential.
Blockchains are fundamental for cryptographic markets
Blockchains are necessary transactions related to anchoring trust in decentralized applications through transparent and unchanging books. During the interaction of multi -party DAPP Blockchains act as a source of truth for the concrtines of the conciliar records, making chains an integral layer of infra.
Binary argument of the chain vs. APP is false because the chain chains are essentially temporary for data generated by DAPP. Such data for time markers facilitate all Onchain transactions and enable people to use DAPPS flawlessly.
It does not matter whether the potential of blockchain value is based on the revenues and acceptance of users, because it is the task of games, social and financial applications. Blockchains is a fundamental layer for building applications and other user products that generate phrases from investment capital.
In addition, despite the challenges related to liquidity and integration, the constant growth of modular application chains is another example of the importance of blockchain architecture. When hungry for resources consume network capacities, application chains solve the problem, functioning as independent locks to increase performance and reduce delays.
The use of application chains for solving bottlenecks of the network shows that the applications do not function independently and require adequate chain architecture. Each modular application therefore has its own computing resources, storage capabilities and resources to prevent the slowing down of competitive applications.
These examples illustrate why cryptographic markets value blockchain, more than independent applications. This is because the applications will not survive without block chains.
“Value” does not always mean financial incentives and growth indicators. Sometimes the value also results from the recognition of their cardinal role in the industry. In this market scenario, Blockchains will always be much more valuable than individual applications, regardless of fees and revenues.
Opinion: Hata Sheikh, founder of Coin Terminal.
This article is used for general information purposes and should not be and should not be treated as legal or investment advice. The views, thoughts and opinions expressed here are themselves and do not necessarily reflect or represent the views and opinions of Cointelegraph.
