Analysis of 8 key narratives of crypto applications: where are the next billion user scenarios?

Author:arndxt

Compiled by: Glendon, Techub News

Why I no longer advise my friends to “learn about cryptocurrency” first.

Last month, I once again tried to get a non-cryptocurrency friend started. Ten minutes into the tutorial, her eyes started to wander as she was talking about “choosing a wallet” and “now you need to pay for gas in another token.”

It suddenly dawned on me: What we’re facing is not a knowledge gap, but a design gap.

The harsh reality is that the speculative wave brought in the first wave of users, but it won’t attract the next billion. Real adoption begins when cryptocurrency products become invisible — people can benefit from them without realizing they are using cryptocurrency technology.

From the rise of stablecoins and institutional staking to the growing role of AI in the development of the digital economy, the foundation for the large-scale application of cryptocurrencies has been laid. But to open up such a future, we must stop requiring users to learn about cryptocurrencies and start building crypto products that allow them to be unaware of the underlying technology.

Here are eight narratives and projects worth watching in the cryptocurrency application space.

The winning formula for the next generation of wallets: single point perfection

Currently, wallets are in a stage of structural transformation: users are forming the habit of using two complementary wallets - one is a wallet for daily use, similar to a fintech app, and the other is a "vault wallet" for asset storage, similar to a bank account.

Wallet functionality and experience are diverging. As a result, developers who try to cram all functionality into a single interface will ultimately lose out to developers who focus on (a) frictionless onboarding and (b) high-security storage.

Data shows that most users now use 2-5 wallets, with nearly 48% of respondents saying this is because each blockchain is still isolated in its own "walled garden".

At the same time, there is a top concentration of wallets. Senior users (with more than 2 years of experience) are concentrated on Binance, Coinbase, MetaMask or Trust (accounting for more than 54%), while the share of any single wallet in the novice group is less than 20%.

In addition, for most users, self-custody is still daunting. An interesting data is that Binance's self-custody solution "Binance Web3 Wallet" has only attracted 22% of users despite providing a familiar brand and a simplified self-custody path, and most users still have concerns.

In reality, users don’t want to use multiple wallets at the same time. This is not their subjective preference, but they have no choice.

Obviously, the "seamless multi-chain future" that the industry has been talking about has not really arrived. In addition to 48% of users having multiple wallets mainly to access different blockchain ecosystems, 44% of users actively split their wallets for security reasons, which is a significant increase from 33% last year.

It can be seen that the industry has failed to provide true interoperability, thus shifting operational complexity to end users. At the same time, these users are becoming smarter and smarter - they no longer blindly believe that one wallet can handle all scenarios.

Project Examples

Phantom: A popular cryptocurrency wallet that supports Solana and Ethereum.

The divergence between behavior and belief

Speculation remains the core driver. Although 54% of users actually used cryptocurrencies for payments or peer-to-peer transfers in the past quarter, when asked what their favorite activity was, only 12% of respondents chose payment. Speculation (spot, MeMe coins, DeFi activities) is still the most frequent behavior every week, covering almost all user types. Therefore, speculation will continue to plunder the future attention share of cryptocurrency payments as a utility.

The core reasons that hinder the development of practical scenarios are three major obstacles:

Cost resistance: 39% of respondents believe that high L1 gas fees are still the biggest barrier to adoption;
User experience resistance: Only 11% of respondents believe that existing crypto products are friendly to newbies and sufficient to meet the needs of the general public;
Network resistance: Payment behavior relies on existing social relationships such as merchants/friends, but the fragmented chain and wallet ecosystem breaks this cycle.

Project Examples

Huma Finance: PayFi is a pioneer in cross-border payment finance. It does not require pre-capitalization and earns real returns from real-world payment flows (APY reaches 10.5%).
Tectum: Instant, fee-free cryptocurrency payments through real-time liquidity;
Alchemy Pay: Fiat and cryptocurrency payment gateway;
NOWPayments: A payment gateway that supports over 300 cryptocurrencies including Bitcoin.

The chain is a new infrastructure layer, but users don’t need to be aware of its existence

The essence of a multi-chain ecosystem is a system of division of labor. Chain abstraction will become the winning user experience (UX) model, and wallet sessions can smoothly route orders, balances, and identities to any backend that provides the best combination of latency, cost, and security without requiring users to make a choice.

Currently, Ethereum remains the institutional-grade settlement layer, but Solana is quickly becoming the chain of choice for high-frequency, high-engagement retail activities. From a momentum and growth perspective, Ethereum faces the strongest competitive pressure to date:

Solana’s fees grew 3,000% year-over-year, and its TVL grew 127% year-over-year, leading all L1s;
This surge was largely driven by the Memecoin craze, particularly in Q4 2024, but also reflects Solana’s structural advantages in speed and transaction costs.

The survey shows that 43% of respondents said Ethereum is their most commonly used chain; 39% of respondents said it is Solana; only 10% of respondents mainly use L2, which shows that interoperability is still in the theoretical stage rather than the practical stage.

Project Examples

Chainlink: Launched the Cross-Chain Interoperability Protocol (CCIP);
LayerZero: Launch of Omnichain interoperability protocol and OFT standard;
Wormhole: a cross-chain messaging protocol.
SOCKET Protocol: Cross-chain interoperability protocol, tokens are coming soon;
eOracle: An Ethereum-based oracle platform that provides permissionless professional data services for smart contracts.

The illusion of increased security

Users claim to feel more secure on-chain, but their wallets tell a different story.

So, how do we explain this paradox?

In fact, users confuse personal enhancements (hardware wallets, multi-signatures) with systemic risks. At the same time, attackers industrialize "phishing as a service" and shorten the life cycle of malicious contracts by four times.

Current product priorities should focus on a “push-down anti-phishing” user experience (clear signing interface, real-time simulation, MPC transaction firewall), which must be transformed from advanced add-ons to default configurations, especially in mainstream “everyday” wallets.

NFT becomes the infrastructure of digital culture

The NFT market is undergoing a necessary healthy adjustment, moving from speculative avatar (PFP) projects to real digital assets and practical scenario-driven experiences. This is also the first time that NFT has begun to show sustainability.

In addition, the surge in low-cost NFT collectibles on platforms such as Base and Rodeo.Club also highlights the rise of low-cost, high-frequency user engagement models, which is similar to in-app purchases in games rather than traditional art collections.

NFT is becoming the participation infrastructure of the digital economy

NFTs will gradually become the default interaction layer for consumer applications: loyalty points, badges, membership benefits - all of these will increasingly appear on-chain in the form of NFTs. Ownership will be transferable and tradable across platforms, no longer limited to a single platform, which will unlock secondary value for users and unlock more monetization channels for brands. Imagine Starbucks' loyalty program operating on-chain, where points earned in one application can unlock benefits across a network of partner services.
NFT becomes the digital embodiment of cultural capital: NFT is rapidly becoming a mechanism for users to express their identity and cultural belonging in the digital space. As social platforms integrate on-chain assets, NFT ownership will evolve into the primary way of digital self-expression, just like wearing brands in the real world.
Success will be measured by retention, not floor price: The era of judging NFTs by speculative value is coming to an end. The new metrics are retention and frequency of engagement. How often do users interact with NFTs? Are these NFTs tied to ongoing experiences, content, or rewards? This will become a top-of-mind question for builders, who should design NFT ecosystems to encourage repeat engagement through unlockable content, evolving token properties, and real-world benefits.
AI + NFT will unlock the next wave of personalized dynamic assets: AI-generated NFTs related to user behavior, emotions, or community events are coming. These dynamic assets will continue to evolve with user engagement. This will unlock deeply personalized experiences and create emotional attachments that static assets cannot achieve.

Project Examples

Treasure: NFT infrastructure;
Mocaverse: Infrastructure that connects the Animoca brand ecosystem using MOCA tokens;
Rodeo Club: NFT participation platform;
NFP: AI-driven UGC platform;
Good Vibes Club: NFT community;
Onchain Heroes: Popular collectibles on Abstract;
Hypio: NFT collections with high trading volume and rapid growth;
steady teddys: a popular collection on Berachain;
Pudgy Penguins: One of the leading NFT brands to gain mainstream adoption;
Bored Ape Yacht Club: A representative collectible with a strong community and ApeCoin tokens;
CryptoPunks: Original NFT collectibles, considered digital artifacts of historical significance;
Azuki: A Japanese anime-inspired NFT series with ANIME tokens and strong brand influence;
doodles: Colorful NFT collectibles, recently launched DOOD token on Solana;
Milady Maker: Owns CULT tokens and a strong community.

Bitcoin: A new paradigm for macro assets

Bitcoin has evolved from a speculative asset to a macro-level financial instrument.

A parallel revolution is unfolding. Thanks to the maturation of the Layer 2 ecosystem, especially emerging protocols such as Lightning Network, Ark, and Fedimint, Bitcoin is quietly becoming the invisible transaction layer for global settlement, which supports the next generation of cross-border payments, institutional finance, and sovereign digital reserves.

Bitcoin’s Macro Correlation

From hedging assets to strategic reserve assets: Countries struggling with de-dollarization are quietly exploring Bitcoin as part of their sovereign reserve diversification strategies; institutions and even sovereign actors view it as a necessary insurance policy against systemic financial risks.
Layer 2 protocols are unlocking Bitcoin’s payment utility: the Lightning Network has evolved from a technical experiment to a scalable real-world payment layer that enables near-instant, low-cost cross-border transactions; new solutions such as Fedimint and Ark are addressing Bitcoin’s user experience and privacy limitations, making it possible for Bitcoin to become a true transactional currency in emerging markets. Builders should focus on leveraging these layer 2 payment solutions and cross-border financial products, especially for remittance corridors and regions plagued by currency devaluation.
Bitcoin as collateral, institutional lending on the rise: Major institutions use Bitcoin not only as a passive investment, but also as productive collateral for structured financial products. Expect an increase in Bitcoin-backed credit instruments, treasury management solutions, and derivatives that integrate seamlessly with traditional financial markets.
A global settlement network is taking shape: As geopolitical frictions intensify, the need for a neutral, censorship-resistant settlement mechanism will grow. Bitcoin is uniquely positioned to serve as a clearing layer for global trade settlements, complementing rather than competing with fiat currencies. Infrastructure that hides the complexity of Bitcoin transactions from end users, enabling seamless settlements based on Bitcoin at the bottom level, will drive adoption beyond the cryptocurrency’s native circles.

Project Examples

Solv Protocol: Launching the first on-chain Bitcoin financialization and banking service;
stacks.btc: Bitcoin layer 2 network, supporting smart contracts and applications;
Alpen: Bitcoin layer 2 network;
Babylon: Bitcoin cross-chain and staking solution;
Zeus Network - Bitcoin interoperability protocol.
corn: The network built for BTCFi.

Institutional pledge: a new model for strategic capital allocation

As Bitcoin solidifies its position as a macro asset class and core component of modern financial strategy, the next natural question for institutions is: How can we make these assets work?

While retail investors continue to chase speculative gains through Memecoin and high-risk trading, institutional capital is quietly but steadily flowing into structured, yield-producing crypto assets, particularly through the Ethereum and Solana staking ecosystems.

Bitcoin may play a leading role as a macro hedge, but staking is quickly becoming an institutional bridge to productive on-chain capital.

Bitcoin becomes a store of value for productive capital: With the emergence of similar staking mechanisms native to Bitcoin (e.g., through the Babylon protocol and upcoming BTC Layer2 solutions), Bitcoin also begins to find its place in yield-generating strategies without compromising its core monetary properties.
The real opportunity is infrastructure, not validators: the next $1 billion of institutional inflows will come from platforms that offer institutional-grade custody, compliance reporting, and risk-managed staking products.
Diversification of income in an uncertain macroeconomic environment: As interest rates peak and traditional fixed income products lose their appeal, staking income will bring a new risk-adjusted income category that is particularly attractive to corporate treasuries that want to diversify their assets away from cash holdings and low-yielding bonds without exposing themselves to the volatility of speculative crypto assets.

Project Examples

Core DAO: Bitcoin PoS layer, non-custodial Bitcoin staking solution;
BounceBit: Institutional staking platform;
TruFin: Institutional-grade liquidity staking platform;
Archax: UK regulated institutional-grade exchange.

Regulation, Stablecoins and AI: The Next Entrance

From compliance unlocking the stablecoin market, to cheap and instant global payments creating real daily touchpoints, to verifiable on-chain sources becoming the trust layer for AI to create value, payment is merely the "beachhead".

Regulatory Optimism: 86% of respondents believe clearer rules will accelerate adoption; only 14% believe it will hinder innovation.
The appeal of stablecoins: holding rates have almost doubled year-on-year to 37%, and they have become the default payment method in more than 30 markets for payment giant Stripe.
AI synergy: 64% of respondents believe that AI will at least accelerate the development of encryption technology; another 29% of respondents expect a "two-way flywheel effect."

Project Examples

WLFI: Trump family project WLFI, launched USD1 stablecoin;
Ripple: Launched RLUSD stablecoin and used XRP as Gas token;
Ethena Labs: Launched USDe stablecoin and will launch TradFi-focused tokens;
OpenEden: Launching a yield-generating USDO stablecoin
cap: A stablecoin protocol with reliable financial guarantees.

Conclusion: User Experience (UX) 2.0 is the key to success or failure

Users are no longer confused by narratives such as "Web3". They expect to have the simple experience of Web2 level, the asset ownership protection of Web3 level, and the intelligent experience of AI level.

Teams that abstract chain selection, lower transaction fees, and embed predictive safety nets will transform cryptocurrency from a speculative "playground" to a connection point for the on-chain Internet. The next billion users will not even know that they are using Web3 products, and this "invisibility" will be the ultimate victory for user experience.