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Hi, my name is Lorenzo Valente. I’m the Director of Research of the Digital Asset team at ARK Invest. And today we’re going to go over ARK Big Ideas 2026 and the Defi application section.
So, jumping into the Defi application section, this year has really been the year for applications. For many years, most of the value was going to layer one to underneath to the blockchain. And we’ve seen really a growth of application economics this year.
And so, what you can see here is for the first time applications have out earned blockchains in terms of revenue and now earning almost 1.2 times what blockchains have earned over time. And this was mainly due to, first of all, many applications hitting product market fit and #2 you know, the power law where we’ve seen really two or three applications that have hit escape velocity and really have earned most of the, the economics in the applications.
So, really what I, what we wanted to show is the scale of, of defy and blockchain native companies. So, we’ve compared assets on platform from Coinbase, Robin Hood, which are more traditional off chain exchanges, I would say to defy protocols or, crypto native companies so such as Tether or Circle.
And we see that really; they’re catching up very quickly in this section wanted to highlight also the efficiency and scale of block chains in general and smart contract applications. They’re extremely efficient in terms of human resources and scale extremely quickly.
And so, you can see in this slide, if we analyze the company revenue per employee, we have 3 crypto companies that are in the in the top ten in the world with Hyperliquid, Tether and Pump.fun with each Hyperliquid having less than 15 employees, Tether less than 300 employees and pump dump fund probably less than 100 employees.
And so, you can see in this slide, if we analyze the company revenue per employee, we have 3 crypto companies that are in the in the top ten in the world with Hyperliquid, Tether and Pump.fun with each Hyperliquid having less than 15 employees, Tether less than 300 employees and pump dump fund probably less than 100 employees.
And the last slide really was on layer 1 valuations and what we have seen over time. And so, what we want to show here is taking a 50x multiple on revenue for Bitcoin, Ethereum and Solana, we can see that Bitcoin, which is no surprises, almost 100% valued on monetary premium. So, like money nest properties and store value properties.
Ethereum overtime as well has been shifting more from a fee-based valuation to a monetary base valuation with now you know, more than 90% of its more than 200 billion market cap valued as a as a monetary asset.
Solana right now, although it’s trading lower is still very much on a fee-based valuation and revenue base. But you know, we believe as it’s a winner takes most even on the smart contract L1s. Overtime we could have like 3 or 4 platforms that have significant monetary premium where most of the valuation is derived from that.
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