Through zk-rollup technology, Abstract provides low-cost, high-throughput on-chain transaction capabilities, bringing scalability and security guarantees to consumer applications.
Author: Animoca Research
TL;DR
Abstract Chain will launch in January 2025 as a consumer-centric blockchain dedicated to promoting the widespread adoption of crypto technology, creating an accessible and engaging platform.
Abstract Chain offers a smooth user experience brought by native account abstraction and leverages the established advantages of Pudgy Penguins and the PENGU fan community to provide differentiated value through its unique user structure.
Abstract's growth strategy revolves around building a digital entertainment theme park: it has its own portal platform, integrates live streaming and reward systems, and attracts application developers to join the ecosystem.
As of the end of May this year, the live streaming platform has attracted over 10,000 streamers, with an average daily user engagement time exceeding 7 minutes and a 30-day retention rate of 40%. The live streaming feature has become one of the main competitive advantages.
Abstract Chain has now achieved large-scale application: nearly 2 million registered wallet users, about 100,000 daily active wallets, and approximately 700,000 daily on-chain transactions, reflecting extremely high platform activity.
Introduction
Abstract Chain was established in March 2024 as an Ethereum-based Layer 2 blockchain that utilizes zero-knowledge cryptography (zk) technology, aiming to provide a seamless and differentiated Web3 experience for mainstream consumers. The chain employs an account abstraction mechanism to simplify wallet setup and on-chain signing processes, lowering the entry barrier. Through zk-rollup technology, Abstract offers low-cost, high-throughput on-chain transaction capabilities, bringing scalability and security guarantees to consumer applications.
Despite the fierce competition in the blockchain ecosystem, there is still a distance to go before true mass mainstream user adoption is achieved. Early projects like Arbitrum and Optimism successfully addressed performance bottlenecks and attracted crypto-native users. However, to achieve so-called "consumer-grade Crypto," a Web3 platform that combines low barriers to entry with high user retention must be built.
Early explorations like TON and Kaia attempted to lower user acquisition costs by integrating Web3 into mainstream social platforms like Telegram and LINE. While they achieved some success, this model, which relies on the openness of Web2 platform ecosystems, still struggles to take root in mature markets like Europe and the United States.
Abstract Chain has chosen a different path: by embedding crypto technology directly into consumer applications, it promotes seamless user adoption. Abstract's mainnet will go live in January 2025, along with the launch of the Portal platform, serving as the entry point for its gaming and application ecosystem. The Portal is not only a content showcase but also a highly interactive online destination, integrating live streaming, rewards, collectibles, and Spotlight (application recommendations) sections to create a sticky user experience. This strategy distinguishes Abstract from other chains and serves as the core engine for its growth.
Abstract's Business Flywheel
The development of a new chain typically begins with establishing a developer ecosystem, gradually increasing on-chain total value locked (TVL) through the development of on-chain applications and the introduction of DeFi protocols. To attract users, project teams often incentivize participation through airdrops and other means.
The network effects of these models primarily rely on the on-chain assets held by users. For example, Ethereum was initially driven by the NFT boom, while Solana recently gained popularity due to meme coins. These native assets bind users to the chain while driving developers to build applications around trends. If we use merchants as an analogy, this approach is more like attracting customers to use a specific payment card that can only be spent at certain stores.
Abstract Chain, however, takes a different approach. It does not focus on asset accumulation but instead builds the Portal platform as a dynamic online hub designed around three main functions:
Basic services: Wallet, fiat entry, token exchange, and other tools that provide access to the ecosystem;
User interaction: Live streaming and reward centers enhance user stickiness;
Project discovery: The Spotlight section guides users to explore new content.
This system ensures that new users can quickly access Web3, while existing users are continuously attracted back by new content.
Using a shopping mall as an analogy, Abstract is more like operating a thriving large shopping center: integrating multiple shops in one place and continuously hosting performance events on a central stage to maintain high traffic and activity, encouraging customers to return and enjoy the experience.
The following analysis will focus on three key growth areas: user inflow >> portal engagement >> application ecosystem drive. Together, they form the core components of Abstract's platform business flywheel.
A. User Guidance
Abstract's initial user base largely benefits from its association with the Pudgy Penguins IP, complemented by a very user-friendly design philosophy. While fans of Pudgy and PENGU continue to flock to Abstract, the smooth guidance experience gives this chain a significant advantage in converting attention into real users.
Easy Onboarding Experience
Abstract Chain is committed to simplifying the user onboarding process by eliminating traditional barriers. Its native account abstraction feature allows users to easily create an Abstract account and enable a wallet, just like registering for a regular website account. Users do not need to manage private keys or frequently sign transactions. Account recovery and transfer operations are as intuitive as browsing the web or playing games. Additionally, the use of zero-knowledge rollup technology on-chain ensures extremely low gas fees and high concurrency capabilities, significantly reducing the cost of on-chain interactions.
Once users create an account, they can immediately use all basic crypto tools through the Portal. The wallet located in the upper left corner of the page supports real-time transaction functionality and provides deposit options, including bridging and fiat deposit services, for quick fund deposits. The transaction section of the Portal supports native currency exchanges without the need to search for third-party services. These integrated features collectively lower the barriers to entry, allowing users to seamlessly access the on-chain world.
Pudgy Fans as Early User Base
Abstract leverages the large and active fan community of Pudgy Penguins. Pudgy Penguins has over 3 million fans across X (formerly Twitter), Instagram, and TikTok, along with over 500,000 PENGU token holders, providing Abstract Chain with a ready-made user pool. The image of Pudgy Penguins is omnipresent in Abstract's Portal, akin to Mickey Mouse in Disneyland: it appears in marketing banners, user avatars, and live streaming stickers. For PENGU holders, the Portal also has practical uses—they can tip live streams using PENGU Tokens, which is one of the scenarios where PENGU can be used on Abstract.
This synergy between the IP and platform functionality greatly promotes the growth of the Portal—within two months of the mainnet launch, it attracted 1.61 million wallet activations. More importantly, due to the widespread distribution of Pudgy and PENGU fans, Abstract's user profile differs from other consumer-grade crypto ecosystems like TON and Kaia. Abstract attracts a large number of users from developed markets—17.4% from the United States, with the remaining users primarily distributed across European and East Asian countries, including Germany, the UK, France, Japan, South Korea, Singapore, and Hong Kong. This user group is highly valuable for consumer applications, providing a strong foundation for Abstract to build a high-quality consumer ecosystem.
Source: Abstract Official
B. Portal Platform
Abstract's portal platform is referred to as the "Digital Theme Park of Fun." It is not only a place for users to discover popular applications and creators but also the core interface for users to manage assets and rewards.
Early data indicates that the Portal is performing well. As of March 2025, the Portal has over 600,000 monthly active users (MAU) and 100,000 daily active users (DAU), with users spending an average of over 7 minutes per day. Among Abstract's global wallet (AGW) users, 40% return to make at least one transaction within 30 days of creating their wallets, a retention rate that far exceeds the industry average.
Live Streaming Feature
Live streaming is a medium highly favored by young people worldwide. Web2 platforms like Twitch attract 240 million unique users each month from around the globe. For Abstract, live streaming not only serves as a reason for users to return but also enhances platform stickiness and monetization potential. Live streaming has been proven to promote game and merchandise sales, aligning closely with Abstract's goal of building an entertainment ecosystem.
Abstract's "Stream-to-Earn" model encourages user interaction through activities such as tipping, commenting, and gifting, allowing both streamers and viewers to earn tokens, rewards, or experience points (XP). Additionally, the "Follow" and "Recommend" features help build a community atmosphere, promoting continuous user visits and social sharing.
As of the end of April 2025, the Portal has accumulated over a thousand streamers, with total live streaming watch time exceeding 500,000 hours. Some top streamers have even received tips as high as 9 ETH in a single session. The top 100 streamers account for a significant share of the platform's tipping revenue, with individual monthly incomes ranging from $4,000 to $5,000 and interactive users exceeding 4,000.
Rewards and Reputation System
Many crypto projects incentivize early user participation through point systems, but a truly comprehensive loyalty and reputation system remains scarce in on-chain ecosystems. Abstract has built such an infrastructure using XP and a badge system.
Abstract uses off-chain XP as the primary incentive tool to encourage participants who meet target behaviors. Content creators can earn XP through live interaction, developers can earn XP by completing user engagement tasks, and regular users can earn XP through actions such as linking social accounts or using recommended applications.
At the same time, the badge feature allows users to showcase their achievements. Different types of badges are minted as on-chain NFTs or displayed within the app based on behavior and task levels, becoming part of the user's identity and gradually forming a complete reputation system.
Currently, this system is still in its early stages, with functionality limited to the Portal. However, in the future, the XP and badge system is expected to expand across the entire Abstract ecosystem, developing into a comprehensive loyalty and reputation framework that serves both developers and users.
Application Discovery
The Portal also plays the role of an "app store" for the Abstract ecosystem. The "Discover" section showcases high-quality applications selected by user votes, categorized into sections such as digital collectibles, games, NFTs, social, AI, trading, and prediction markets. Users can log into these applications directly using their Abstract ID and start experiencing them immediately, without cumbersome registration processes.
C. Application Ecosystem
The ultimate success of any blockchain depends on its ability to incubate a rich and diverse application ecosystem. For Abstract, its mission is to attract consumer-oriented "fun" applications from Web3 projects and mainstream institutions.
Web3 Projects
Abstract is fully compatible with EVM (Ethereum Virtual Machine), supporting the migration of existing Ethereum smart contracts and facilitating cross-chain deployment. The platform has launched a "Builder-in-Residence Program," providing developers with market support, technical guidance, and monthly stipends. Developers can earn monthly XP rewards based on user engagement, and outstanding projects have the opportunity to receive additional incentives. The live streaming platform will also promote featured games through embedded links to drive traffic to applications.
Games are a crucial entry point for attracting Web2 users into the Web3 world. Among Abstract's top ten popular applications, eight are game-related products. Popular games include "Pudgy World," "Bigcoin," "BTC Mining Game," adventure titles like "Onchain Heroes" and "LOL Land," as well as Pudgy IP games launched by YGG and community projects like "Gigaverse."
By collaborating with NFT platforms such as Magic Eden and OpenSea, Abstract has enabled the buying and trading of game assets, further enriching the gaming ecosystem. Currently, over 120 projects have been deployed on Abstract, covering social applications like "Gacha," trading platforms like "BuzzFun" and "Myriad," as well as games like "Gigaverse," "Onchain Heroes," and "Multiplier."
Abstract's strong user base allows new projects to quickly gain attention. For example, "Duper" and "Witty" attracted 50,000 users just days after launch; the prediction market "Myriad" drew nearly 500,000 users within two months of its launch. These success stories greatly enhance developer confidence and encourage more teams to invest in building.
Mainstream Institutions
Abstract is actively collaborating with consumer-facing institutions, such as music and sports brands, to migrate their Web3 products onto the chain. For instance, digital collectibles similar to NBA Top Shots will be issued in NFT form, allowing fans to purchase, hold, and trade. These sports and music fans align perfectly with Abstract's consumer positioning.
For institutions seeking on-chain partners, Abstract has inherent advantages—Ethereum-level security, a user-friendly interface, and low-barrier access methods are its core selling points. Although specific collaborations have not all been officially announced yet, once initiated, they are expected to bring a large number of mainstream Web3 users to Abstract, allowing them to truly immerse themselves in the on-chain experience.
Recently, the Oracle Red Bull Racing team launched an on-chain fan interaction project called "In the Moment" on Abstract, targeting Gen Z and Gen Alpha youth, combining classic F1 moments with digital ownership and interactive experiences. This project transforms viewers from passive spectators into active participants and is a multi-year strategic deployment aimed at attracting young people to convert their interests into a sense of belonging and even "shareholder" awareness through collectible and interactive on-chain methods.
Core Concept: Consumer-Grade Crypto
Luca Netz, co-founder of Abstract, clearly states that Abstract's mission is to create "consumer-grade crypto"—that is, to build a large-scale path for the widespread adoption of blockchain applications that "serve the daily lives of billions of people and meet their personal needs."
They believe that the best way to guide the first 50 million users into the crypto world is to focus on "non-essential consumption" scenarios—those activities that bring joy, evoke emotional resonance, and can enhance experiences through crypto technology.
Abstract Chain is the primary platform for this consumer crypto vision. The unique characteristics of blockchain technology—digital ownership, censorship resistance, and borderless payment capabilities—enable unprecedented user experiences in consumption scenarios such as gaming, social interaction, meme culture, and collectibles. Abstract aims to fully unleash this potential through user-centered product design, making the daily lives of millions of users more enjoyable.
As Michael Lee, co-founder and CEO of Abstract, puts it, this generation of users has fundamentally changed the entertainment, music, and luxury industries: from publishers to streamers, from viewers to athletes, from businesses to creators, and from price tags to cultural value. Abstract's mission is to return "joy, ownership, and creativity" to everyone and make all of this accessible.
At the same time, this strategy of "growth driven by non-essential consumption" also means that Abstract may intentionally overlook certain technology stacks valued by mainstream blockchains, such as advanced DeFi modules, DePin (decentralized infrastructure networks), and RWA (real-world assets). Therefore, users should not expect Abstract to rapidly increase TVL like DeFi-centric chains.
Initial Chain Performance
In July 2024, Abstract officially stepped into the spotlight, announcing the completion of a $11 million financing round led by Founders Fund, while simultaneously launching its testnet. Subsequently, the mainnet officially went live on January 27, 2025, with over 120 applications deployed from the start.
As of early May 2025, Abstract has created nearly 2 million wallets, with a total of 1.4 million deployed contracts, and a total value secured (TVS) reaching $53.4 million. At the beginning of March, the daily transaction volume once reached 1.5 million, later stabilizing around 500,000; by May, the cumulative number of on-chain transactions had reached 60 million.
The platform's 30-day activity also shows strong momentum: the total revenue of the top five applications reached $1.85 million, and the total trading volume of NFTs surpassed $10.4 million. Abstract Chain has not yet released a native token. Since zk-rollup technology itself does not require on-chain tokens for gas fee payments, the future Abstract token will need to break away from traditional models in its functional design, endowing it with new practical value.
On-Chain Metrics Comparison
Abstract's go-to-market strategy (GTM) focuses on consumer adoption rather than traditional DeFi total value locked (TVL) or developer ecosystem share. Therefore, its target user groups include NFT collectors, gamers, streamers, and casual users of social platforms.
From February to May 2025, Abstract's TVS (Total Value Secured) grew by 150%, jumping from $20 million to $50 million. The peak number of active addresses reached 2 million, stabilizing around 500,000 thereafter. During the same period, the cumulative transaction volume reached 60 million. Abstract's initial projects concentrated on the NFT and gaming verticals, precisely aligning with its "consumer-oriented" positioning, striving to capture the on-chain consumption market.
Compared to other chains, Abstract's growth in the first three months after the mainnet launch has surpassed that of ZKsync Era (a leading zk Ethereum scaling network), with its number of active addresses and transaction volume approaching that of TON. Established rollups like Base and Arbitrum provide Abstract with comparable EVM success cases, becoming targets for it to catch up with.
Conclusion
The Abstract team has pioneered a "consumer-centric" model for building crypto ecosystems, aiming to push Web3 into the mainstream. Their vision of "consumer-grade crypto" has been validated through the successful expansion of the Pudgy Penguins IP, now further amplified through the Abstract chain as a vibrant, continuously operating online hub.
For online destinations to succeed, they must leverage network effects, which requires continuously attracting new users, onboarding creators, and serving developers. In its early stages, Abstract has laid a solid foundation for user growth and retention through the Pudgy fan community and its native live streaming platform.
To achieve exponential growth in the future, Abstract needs to uncover truly "killer applications," likely breaking through first in the gaming and pop culture sectors while attracting traffic-oriented creators and global brands to its platform.
At the same time, the consumer crypto space is rapidly heating up. TON and Kaia are backed by social media platforms, while Base and BNB have exchange support, and Sonenium is driven by institutions. These competitors are all joining the race for mainstream adoption. Although "crypto applications for the mainstream market" remain a blue ocean, these diverse attempts are inspiring each other, sparking innovation, and accelerating the entire industry's march toward the mainstream.
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