Blockchains Capture 70% of Crypto Market Value Despite DApps' Revenue Growth

In the evolving landscape of the crypto market, the relationship between blockchains and decentralized applications (DApps) has become a focal point of discussion. Industry stakeholders often prioritize applications based on adoption principles and revenue distribution, overlooking the critical role of the underlying blockchains. DApps, while essential, cannot function without their supporting chains, which are fundamental to the long-term value generation in the market.

The traditional perspective of value within the internet stack, as argued by Joel Monegro in “Fat Protocols,” suggests that investing in underlying protocol technologies yields lower returns compared to applications. However, Monegro later clarified that the value capture in the blockchain application stack is reversed, with the underlying protocol layer accumulating more value than the application layer. This shift indicates that as applications gain popularity, they attract users to the underlying blockchain, driving token price growth and building a strong network where blockchains capture maximum value.

A recent research report highlighted how revenue generation parameters, such as onchain fees, could challenge Monegro's thesis. In 2024, blockchains controlling 70% of the total crypto industry market cap (excluding Bitcoin and stablecoins) earned $6 billion in fees. Meanwhile, DApps, with just a 30% market share, made $3.3 billion, generating 35% of total onchain fees. This trend continued into Q1 2025, with DApps recording $1.8 billion in total fees compared to $1.4 billion for blockchains. The report emphasized that apps generate real value and user interaction, as higher fees reflect increased usage rates. People use apps to trade, play, invest, socialize, and spend time, making apps the primary interaction layer with higher demands and more growth channels.

Despite the importance of apps in generating value and revenue opportunities, the underlying blockchains remain the necessary trust anchor for arbitrating transactions through transparent and immutable ledgers. During multiparty DApp interactions, blockchains act as a truth source for tamperproof records, making them an integral infra layer. The chain vs. app binary argument is false because blockchains are essentially timekeepers for dApp-generated data, facilitating all onchain transactions and enabling trustless use of DApps.

The steady rise of modular app chains further illustrates the importance of blockchain architecture. When resource-hungry apps consume network capacities, app chains solve the issue by functioning as independent blockchains to enhance performance and reduce latency. Each modular appchain has its own computational resources, storage capacities, and resources to prevent competing applications from slowing down performance. These examples demonstrate why crypto markets value blockchains more than standalone applications, as apps won't survive without their supporting chains.

In conclusion, the value of blockchains in the crypto market extends beyond financial incentives and growth metrics. The market recognizes their cardinal role within the industry, ensuring that blockchains will always be more valuable than individual applications, regardless of fees and revenue. This understanding is crucial for industry stakeholders and analysts to appreciate the foundational role of blockchains in the crypto ecosystem.