Consumer applications driving the next wave of rise in the crypto market

As infrastructure matures, the focus of the crypto market is shifting from technology to user-oriented applications. This report analyzes the current market environment, explores the development trends of consumer applications, and proposes an investment framework.

Market Background

• The market value of stablecoins has slowed down, currently only about 25% higher than the peak in 2021.
• The new liquidity mainly comes from institutional purchases of BTC/ETH, rather than speculative funds.
• The clarification of regulatory policies has unleashed a new wave of rise potential.

Core Perspective

1. The next 5 years will welcome the second wave of rise driven by Web2 users.

   • Policy-friendly creates conditions for entrepreneurs
   • Stablecoin regulations have expanded the market size
   • Web2 users pay more attention to application layer value

2. After the market matures, more emphasis is placed on actual users and revenue.

   • Projects with real income and product market matching in capital flow
   • User experience and actual value are more important than pure technological innovation.

3. After the integration of Web3 and Web2, the attention economy will dominate.

   • Virus transmission and network effects are key
   • Consumer applications are easier to achieve viral growth
   • B2C applications will expand the overall market size

The current scale of consumer application tracks

• Trading/Perpetual Contract ( like Hyperliquid )
• Token issuance platform ( such as Pump.fun)
• Information finance and prediction market ( like Polymarket )

These projects generally have real revenue and user bases, superior to infrastructure projects that have high valuations but lack actual use.

Potential Track: The Encryption Upgrade of Web2 Applications

1. One-stop deposit/withdrawal + DeFi super application

   • Address the current pain points of a cumbersome deposit process and high fees.
   • Integrate functions such as banking, wallets, and trading

2. Entertainment/Media/Social Platforms

   • Use on-chain monetization mechanisms instead of advertising models
   • Optimize user experience and improve creator earnings

AI and games are not yet mature and still need to wait for breakthroughs in infrastructure and gameplay.

Investment Framework

• Focus on a few consumer-oriented "super chains" ecosystems
• Web2 Native: Backend integrates encryption but does not emphasize "encryption applications"
• Web3 Native: Excellent UX, speed, and liquidity are key

Evaluation criteria:

• Distribution capability > Pure technical innovation
• Brand and user experience are implicit but key factors.
• Evaluate from the perspective of "enterprise" rather than "protocol": real income, scalable model, industry dominance

In the next 5 years, consumer applications will be the new main investment direction, rather than purely infrastructure projects.