The “Fat App” Comeback

Hey there, Degens!

You’ve probably heard it said a million times: “Blockchains capture the real value, not the apps.” In other words, people have believed that the protocol layer—like Ethereum, Solana, or Bitcoin—would get all the attention and money, while the actual applications built on top of these chains would remain comparatively small.

But guess what? Times are changing. There’s a fresh conversation about whether “Fat Apps” might be more important—and potentially more valuable—than the blockchains they run on.

Let’s break it down step by step.

Crypto Order Sparks National Digital Asset Focus

A newly signed executive order aims to build a national digital asset stockpile, highlighting the strategic potential of blockchain. DeFi Technologies Inc. (US: DEFTF & CAD: DEFI.NE) stands at the forefront by offering regulated exchange traded products that simplify digital asset access. As the U.S. takes strides in crypto policy, discover how DeFi’s approach may align with this emerging infrastructure.

Explore Crypto’s Next Chapter

What Does “Fat Protocol” Even Mean?

• Think about the internet. The foundational technologies (protocols) that run the web—like HTTP, TCP/IP—are super important, but they aren’t the ones making a ton of money. It’s the companies like Google, Facebook, and Netflix that rake in the profits by building on top of those protocols.

• In crypto, many believed the opposite would be true: that the blockchain protocols (think Ethereum, Solana, Bitcoin) would capture the majority of the value. They argued that because these blockchains have their own native tokens (ETH, SOL, BTC), and because everyone using these networks has to own or spend those tokens, the blockchains (protocols) would “get fat” with value.

For a while, that seemed to be the case: Ethereum’s market cap exploded into the hundreds of billions, while most of the applications built on Ethereum remained relatively small.

The “Fat App” Argument—What Changed?

Now people are saying, “Wait a minute… maybe the apps will be the real winners.” Why?

1. User Experience Is King

   • A lot of purely decentralized applications are awkward to use. If you’ve ever fumbled with multiple browser extensions, seed phrases, and random tokens, you know the struggle.

   • Meanwhile, “easier” apps—sometimes centralized—are simpler, faster, and more intuitive. And guess what? Most people (including new crypto users) prefer simple.

2. Interoperability Lowers Moats

   • Before, one chain could brag: “We have all the liquidity!” or “We have all the users!”

   • But cross-chain bridges and interoperability tools are making it easier for money (and data) to flow among different chains. That means an app can live on multiple blockchains or move wherever it wants. If no single chain can lock down liquidity or users, the advantage shifts to the apps that can adapt quickly.

3. More Diverse Use Cases

   • We’re moving beyond “token go up.” Things like on-chain gaming, social media, real-world assets, and more are starting to take shape. These apps can become massive hubs of user activity—and wherever the users are, that’s where the revenue (and power) flows.

Don’t Blockchains Still Matter?

Absolutely. Protocols are the foundation. If you think about them like roads and highways, you still need those roads to drive anywhere. But roads by themselves aren’t profitable unless someone uses them—cars, trucks, or (in our analogy) apps.

• Some blockchains will still be extremely valuable if they offer unique features (maybe better speed or privacy) or cater to certain niches (like high-performance trading or specialized gaming).

• Others might become interchangeable, meaning there’s no strong reason for developers and users to stay loyal if a better or cheaper option appears.

Why Now?

• Better Dev Tools & UX: Building on blockchains used to be a coding nightmare. Now we have improved frameworks, “drag-and-drop” solutions, and cross-chain libraries. This means a smaller team can create a polished app that’s easier to adopt.

• Reduced Reliance on Pure Speculation: Instead of just hype around token prices, apps are focusing on real functionality—like user rewards, loyalty points, or digital collectibles with actual use cases.

• Easier Onboarding: With more user-friendly wallets and fewer steps, people can try out these apps without feeling overwhelmed. Once you can onboard the masses, you can scale quickly.

So, Who’s “Fat” Now—Protocols or Apps?

• In previous years, it looked like protocols would be the big winners. But as user experience becomes more crucial, apps are gaining momentum.

• Imagine if a few big apps capture most users—like how Facebook, Instagram, and YouTube dominate social media. If these apps connect to multiple blockchains behind the scenes, they might end up capturing most of the value, branding, and daily user activity.

• The blockchains, meanwhile, become more like infrastructure—important, but not necessarily the star of the show.

Final Take: Coexistence, Not War

This isn’t about “protocols vs. apps” in a battle to the death. They need each other. Chains provide the backbone (security, consensus, etc.), and apps bring in actual people. But the spotlight is shifting because building amazing user experiences can lead to bigger, more sustainable growth than simply rolling out “yet another chain.”

Stay degen, stay open-minded, and remember: the next wave of crypto might revolve around killer apps that make blockchain’s complexity disappear in the background. If you’re a user, you get a simpler interface. If you’re an investor, you might want to keep an eye on projects that focus on people first.

Meme of the Day

The DegenDen Team
P.S. How do you feel about the shift from fat protocols to fat apps? Hit reply or jump into our socials for a heated debate.