The world of cryptocurrency continues to evolve at a rapid pace, driven by innovation, user adoption, and shifting market dynamics. As an investment partner at Variant Fund, I periodically reflect on where we stand and where we’re headed. This piece captures my latest internal assessment—refined for public insight—on what’s working, what’s emerging, and what could shape the next wave of growth in the space.
The analysis is structured into three core sections: what’s working, notable ongoing trends, and promising new frontiers. While grounded in data, this reflection also carries subjective insights shaped by observation and experience. My goal is clarity, honesty, and forward-looking perspective.
What’s Working: Clear Signs of Product-Market Fit
When I say something is “working,” I mean it shows sustainable product-market fit, expands the overall crypto economy, or both. These aren’t just speculative movements—they’re foundations with traction, user engagement, and economic activity to back them up.
Here are 10 areas currently demonstrating strong momentum:
- Stablecoins
- Bitcoin as an alternative asset
- Farcaster
- Asset creation
- Community-trained AI models
- Solana
- Ethereum
- Zora
- Coinbase
- On-chain exchanges
(Bonus: Blackbird)
1. Stablecoins: The Backbone of Global Digital Dollar Access
Stablecoins remain one of crypto’s most successful use cases. Year-to-date, the net inflow into on-chain stablecoin supply has reached approximately $25 billion. Since November 2023, inflows have consistently remained positive—a strong signal of sustained demand.
This isn’t just about speculation. It reflects a growing need for permissionless, borderless access to dollar-denominated value—especially in regions with unstable local currencies or restricted financial systems. The product-market fit here is undeniable and increasingly institutional.
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2. Bitcoin as an Alternative Asset
The approval of spot Bitcoin ETFs in January 2025 marked a turning point. As of June, these ETFs collectively hold over $80 billion in assets—a staggering adoption curve for any new financial product.
Bitcoin’s role as a non-correlated store of value continues to resonate with institutional investors, much like gold. But unlike gold, Bitcoin offers superior transferability, a known supply cap, and growing adoption on corporate and national balance sheets. This combination strengthens the argument that Bitcoin could one day surpass gold in market capitalization.
Meanwhile, private-market activity around Bitcoin is heating up—particularly projects focused on extending its utility through smart contract layers, cross-chain security models, and on-chain lending protocols. Expect tangible outcomes from these efforts in the second half of 2025.
3. Farcaster: The Rise of Open Social Networks
Farcaster, built on open protocols, is gaining meaningful traction—especially since the January launch of Frames, interactive mini-apps embedded directly in users’ feeds. This innovation has transformed passive scrolling into active participation, enabling in-feed voting, minting, and gaming.
The network’s growth isn’t just quantitative; it’s qualitative. Developers are building new experiences atop Farcaster’s social graph, creating a flywheel of engagement and utility. This is what decentralized social media can look like when aligned incentives meet open infrastructure.
4. Asset Creation: A Surge in On-Chain Innovation
New token creation is booming—particularly on Base and Solana. On Solana alone, over 10,000 new tokens are minted daily. While many are meme coins, this activity fuels broader ecosystem innovation.
Take $BERN, a token leveraging Solana’s new token extensions to implement automatic sell taxes (5% burned per sale). Its popularity accelerated wallet support for these standards—enabling advanced features like split payments and confidential transfers. Even speculative behavior can drive meaningful infrastructure adoption.
5. Community-Trained AI Models: Aligning Incentives with Creativity
As AI models become more accessible, the scarcity shifts from computation to taste and attention. Crypto offers a powerful framework to reward those who contribute cultural insight and curation.
Botto exemplifies this trend—an autonomous AI artist trained weekly by $BOTTO token holders. The quality of its artwork improves over time, reflected in rising auction prices and a growing community of contributors. This model proves that decentralized networks can produce valuable creative outputs while fairly compensating participants.
With less than 1% of future AI-generated content currently attributable via crypto-native methods, the opportunity for fair attribution and value distribution remains vast.
6–7: Solana & Ethereum — Dual Engines of Growth
Both blockchains show robust user growth:
- Solana: Daily active addresses are 2–3x higher than last year; monthly actives hit record highs in May 2025. The network now generates meaningful fee revenue, validating its low-cost, high-throughput model.
- Ethereum: Monthly active addresses are up ~30% year-to-date and nearing 2021 peaks. When including major L2s (Arbitrum, Base, Optimism, Polygon), the broader Ethereum ecosystem shows explosive growth in daily activity.
These platforms aren’t just surviving—they’re thriving as foundational layers for the next generation of applications.
8–9: Zora & Coinbase — Business Models That Scale
- Zora Network: With weekly active users up 60% in 2025 and a 34% margin on transaction fees, Zora proves that vertically integrated applications can capture economic value across the stack—from content creation to blockspace provision.
- Coinbase: Beyond being a custodian for 8 of 11 spot Bitcoin ETFs, Coinbase has diversified revenue streams—from stablecoin (USDC) growth to its Base L2 generating millions in fees monthly. Its success validates that crypto-native primitives can support durable, multi-product businesses.
10: On-Chain Exchanges — Decentralized Liquidity Grows Up
Uniswap now has nearly double the traders it had six months ago—and its 7-day volume recently surpassed Coinbase’s spot trading volume. This isn’t isolated to Ethereum: Solana’s Orca and Raydium also show explosive growth in users and volume.
These protocols facilitate hundreds of billions in value exchange monthly—proving that decentralized liquidity can compete with centralized counterparts in scale and efficiency.
Other Notable Trends: SocialFi & Chain Proliferation
While not yet proven as sustainable, two trends are reshaping behavior:
1: SocialFi Applications on the Rise
Platforms like Friendtech and FantasyTop have generated millions in fees by blending social interaction with financial mechanics. While long-term sustainability remains uncertain—many rely heavily on speculation—the attention they attract opens doors for deeper engagement models, such as reputation-based rewards or content monetization.
2: The Surge of New Chains
L2s and L3s are multiplying—especially within the Ethereum ecosystem. Differentiation now hinges less on technical specs and more on brand, community, and economic design.
- Base, backed by Coinbase, thrives despite lacking immediate token incentives—proof that strong branding and distribution matter.
- Chains like Canto, Blast, and Berachain experiment with fee redistribution and yield mechanisms, testing new economic paradigms.
The next wave may focus on external integration—like linking to off-chain identities (KYC), fiat rails (e.g., Coinbase accounts), or human verification tools (e.g., World ID).
Looking Ahead: New Distribution Channels & Building Blocks
Growth begets opportunity—and friction creates space for innovation. As core platforms mature, they enable new forms of distribution and modular infrastructure.
For example:
- Farcaster + Frames could revolutionize digital advertising with wallet-native coupons triggered by user behavior.
- Reservoir’s Relay enables one-click cross-chain checkout—removing friction from NFT commerce.
- World ID offers verifiable human identity—critical as bots flood digital spaces.
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Emerging Opportunities Worth Exploring
Three underdeveloped areas hold significant promise:
- Verifiable Credentials: On-chain proof of employment, education, or achievements could unlock new trust layers in digital interactions.
- Price-Differentiated Assets (PDA): Tokenizing high-demand real-world assets (e.g., restaurant reservations) could bring transparency to opaque secondary markets.
- Behavioral Token Incentives: Projects like Blackbird show how rewarding everyday actions (e.g., dining out) can reshape user habits and deepen loyalty.
These ideas may not yet be “working” at scale—but they point toward a future where crypto integrates seamlessly into daily life.
FAQ
Q: Is Bitcoin still relevant amid all the new blockchain innovation?
A: Absolutely. Bitcoin’s institutional adoption via ETFs confirms its role as a digital store of value. Its security budget and decentralization remain unmatched—making it a foundational asset even as other chains innovate on functionality.
Q: Are meme coins contributing anything meaningful to crypto?
A: Surprisingly, yes. While speculative, meme coin activity drives real user engagement and often accelerates infrastructure development—like wallet support for new token standards or improved trading interfaces.
Q: Can decentralized social networks like Farcaster really compete with traditional platforms?
A: They’re not competing on scale yet—but they offer something unique: ownership and alignment between users and creators. With tools like Frames enabling embedded apps, they’re building a more interactive and economically rewarding social experience.
Q: What makes Coinbase’s growth sustainable beyond trading fees?
A: Diversification. Coinbase earns from stablecoin issuance (USDC), custody services, its Base L2 network fees, and subscription products like Coinbase One—reducing reliance on volatile trading volumes.
Q: How do community-trained AI models differ from traditional AI?
A: They decentralize influence over output quality. Instead of being controlled by a single company, models like Botto evolve based on collective cultural input—rewarding contributors when outputs gain value.
Q: Why does chain proliferation matter?
A: It drives competition in user experience, cost efficiency, and economic design. More chains mean more experimentation—which ultimately benefits developers and users through better tools and lower barriers to entry.
The crypto landscape today feels increasingly real—not just speculative. With multiple ecosystems showing sustainable growth, new distribution models emerging, and real-world behaviors being reshaped by token incentives, we’re moving beyond hype into tangible utility.
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