Crypto Market Values Blockchains Over DApps
While decentralized applications (DApps) are essential, the crypto market demonstrates a stronger valuation of the underlying blockchain infrastructure. This contrasts with the traditional Web2 model, where applications often garner more value than the supporting protocols. Let's delve into the reasons why this is the case.
The Importance of Blockchain Infrastructure
Often, analysts fall into the trap of viewing blockchains and DApps as binary opposites, applying a Web2 framework to a fundamentally different system. However, they are intrinsically linked; DApps are entirely reliant on blockchains for functionality and security. Blockchains provide the crucial trust layer through transparent and immutable ledgers, arbitrating transactions and serving as the source of truth for DApp interactions.
Revisiting the "Fat Protocols" Thesis
Joel Monegro's "Fat Protocols" thesis initially suggested that, unlike the Web2 model, blockchain protocols would accumulate more value than their applications. Recent data challenges this initial assertion. A recent report showed that in 2024, blockchains controlled 70% of the crypto market cap (excluding Bitcoin and stablecoins) and earned $6 billion in fees. While DApps held a 30% market share and generated $3.3 billion, or 35% of total onchain fees. This trend shifted in Q1 2025, with DApps generating $1.8 billion compared to blockchains' $1.4 billion. This shows the increasing importance of DApps' role in generating on-chain revenue.
While DApps are the user-facing interface driving adoption and generating revenue through usage (trading, gaming, social interaction), the underlying blockchain remains indispensable. The analogy of "blockchains building the roads, and apps building the cities" highlights the symbiotic relationship; without the foundational infrastructure, the "cities" cannot exist.
Modular App Chains and Scalability
The emergence of modular app chains further underscores the vital role of blockchains. These specialized chains address scalability issues by providing dedicated resources for specific applications, preventing congestion and performance bottlenecks. This approach demonstrates that even as DApps become more sophisticated, their dependence on robust blockchain architecture remains unwavering.
Why Blockchains Remain Paramount
The value of blockchains extends beyond purely financial metrics. Their role as a trust anchor, providing security and transparency, is paramount to the entire crypto ecosystem. Without the underlying blockchain infrastructure, DApps would be vulnerable to manipulation and lack the trust necessary for widespread adoption. This intrinsic value is often overlooked when focusing solely on revenue generation and user adoption of individual applications.
Codeum, a leader in blockchain security and development, understands this crucial interdependence. We offer comprehensive services including smart contract audits, KYC verification, custom smart contract and DApp development, tokenomics and security consultation, and partnerships with launchpads and crypto agencies. Our mission is to build a secure and trustworthy blockchain ecosystem.
In conclusion, while DApps drive user engagement and revenue, the underlying blockchain infrastructure remains the foundation of the crypto ecosystem. The market’s valuation reflects this inherent dependence, highlighting the critical importance of robust and secure blockchains for the long-term success of the entire industry.