Original Title: The Great Repricing

Original Author: Spencer Bogart

Original Translator: Ken, ChainCatcher

The current state of the cryptocurrency industry is a paradox: as an industry, we have achieved success beyond our wildest dreams, yet the prevailing sentiment is one of extreme frustration that we haven't seen in a long time.

Jonah (@jonah_b) and Spencer (@CremeDeLaCrypto) delve into the ongoing "Great Repricing" here.

The Industry's Judgment is Correct

The industry's assessment of on-chain payments and remittances is correct. In 2025, stablecoin transaction volume reached a record $33 trillion, a 72% increase year-on-year. In just 2025, retail transaction volume surged from 314 million transactions to 3.2 billion transactions.

The industry’s judgment that crypto-native applications will achieve massive scale is correct. Polymarket has become a widely popular global event prediction tool. Phantom has become a must-use wallet for millions of users every day—monthly active users reached 15 million, and it continues to grow.

The industry’s belief in the effectiveness of DeFi is correct. If we consider Aave as a bank, based on deposit base, it would rank among the largest banks in the world.

The industry’s belief that almost all major fintech companies and banks will implement on-chain strategies is correct. Stripe, BlackRock, SoFi, Goldman Sachs, Citigroup, JPMorgan, Visa, PayPal, Revolut, Nubank. They have all entered the market.

It seems clearer now than ever: we are building the right technology, yet the current sentiment lacks any celebratory tone.

The Disconnection between Value and Price

Given the success achieved, why is there no excitement? The simplest answer is price: it feels like token prices have been on a one-way decline for months.

But the crypto market has experienced several large pullbacks since its inception; why does the market sentiment feel worse this time? Some point out that precious metals and stock markets are hitting new highs, while tokens are declining. However, we believe this is merely an exacerbating factor; it is salt in the wound, not the wound itself.

The real reason may lie in the fact thatthe market is forcing industry contributors to accept a harsher new reality: the divergence between business data and token prices may not fix itself automatically.The rules of the game have changed, and new data may overturn long-standing investment logic.

This differs from past cyclical downturns; it more reflects a structural re-evaluation of “where value is most likely to accumulate.”

In past downturns, teams could look inward, focusing on product development, and confidently believe that as long as they could deliver a widely used network or protocol, they could translate that into token appreciation. But it now seems that this confidence no longer holds. Protocols have launched, and adoption rates have scaled, but token prices have not kept pace.

For builders and investors who express their beliefs through token exposure, the end result is: their logic was right, but they bought the wrong asset exposure.

Where the Investment Logic Went Wrong

A simplified logic of token investment is primarily based on three beliefs:

• People will build products that create tremendous value.

• The product will capture a substantial portion of the value it creates.

• This captured value will flow to the token holders.

For years, the question has been simple: does it work? Can it scale? Now these major questions have been answered (yes, it works; yes, it can scale), and the market's focus has shifted to value capture. The situation has also become clear: people are correct on point one. Absolutely correct, indisputable. But most of the value has not accumulated to the token holders.

Value is Shifting to the Upper Layers of the Tech Stack

Most people's exposure to crypto assets is achieved through tokens. And most tokens represent infrastructure: L1, L2, cross-chain bridges, oracles, middleware, protocols, DEX, yield vaults, etc.

But today, the entities capturing the most value look entirely different: Phantom, Polymarket, Tether, Coinbase, Kraken, Circle, Yellow Card. These are companies that currently do not have issued tokens.

The reason is simple: the most valuable assets in crypto are user relationships.

If you control the user interface and the flow of transactions, you control the distribution channels. And if you control the distribution channels, you can profit from almost any on-chain product that users interact with (trading, lending, staking, minting, etc.). We have previously written about this dynamic.

On the other hand, the substitutability of infrastructure is increasing. When block space is plentiful and switching costs are low, the only remaining competitive tool is price. Cross-chain bridges, L2, DEX, and even liquidity can be substituted. Pricing power is being eroded.

Ultimately, in this economic game between infrastructure and distribution layers, we believe that the distribution layer is achieving a decisive victory. Control over distribution channels creates routing power. Routing power commoditizes infrastructure. And commoditized infrastructure pushes economic benefits to marginal costs.

This Was Not Obvious in the Past

This inversion of value capture is shaking the entire industry because it contradicts many longstanding investment logics and structural assumptions — that the underlying networks and protocols will capture most of the value.

But this uncertainty is not a peculiar anomaly of the crypto industry; it is a common theme across tech cycles. History shows that the most important questions about value capture and profit entrenchment are rarely answered in the early stages.

In the early days of the internet, some believed that telecom companies would be the biggest winners because they owned the pipes through which every byte of data flowed. The bullish argument was: telecom companies could charge proportionally based on the value of the data transmitted — which wasn’t unreasonable. However, fierce competition drove data prices down to marginal costs, completely commoditizing telecom companies, while value flowed up the tech stack.

Yet not every tech cycle rewards the application layer. For semiconductors and cloud computing, infrastructure providers ultimately captured a significant amount of value. In these examples, it was scarcity, capital intensity, and high switching costs that concentrated economic power at the bottom of the tech stack.

AI currently faces the same question: will foundational models capture value? Or will the open-source model commoditize them and push value up the tech stack?

In the crypto industry's version, the original assumption was that liquidity and network effects would create lasting infrastructure winners and facilitate meaningful value capture. Today, applications and aggregators lie between users and the underlying infrastructure, rationally routing transaction volumes to where fees are lowest. The result is a structural decoupling: the “pipe” is more congested than ever, but value capture has shifted upward to the level that controls the user relationships.

What Happens Next

This is not a requiem for tokens, nor is it the end of infrastructure investment.

The crypto industry has now gone through three distinct phases: first speculation, then validation, and now we are establishing where value capture will occur. The current discomfort stems from this final paradigm shift.

Infrastructure and applications exist within a continued feedback loop: as applications reach new scales, they will eventually encounter bottlenecks needing the next generation of infrastructure to solve, thereby opening up a new cycle of opportunities. Additionally, there are excellent infrastructure products that possess genuine pricing power, but this pricing power must be earned and proven rather than taken for granted.

Tokens will also make a comeback, but they may look different: they are gradually shedding the overemphasis on governance rights in favor of direct participation in application layer economics, even becoming tokenized equity instruments with direct claims on cash flow.

Hyperliquid is an on-chain application example with real distribution strategies, and its economic model is unified around a single asset. A broader evolution in this direction has already begun: Morpho, Uniswap, and now Aave seem to be heading towards unifying protocol layer and application layer economics around their respective tokens.

Currently, the rules of the game have changed, and the market is sending a clear signal: mere utility is not enough. Mere scale is not enough. The market demands a direct and provable connection between usage, revenue, and asset value.

The industry is right in terms of technological direction. Now the market is determining who can reap the rewards. Those builders who address not just value creation but also value capture will define the next era of the industry.

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