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How to Stop Crypto From Hitting $10 Trillion
Charlie Munger liked to say: "Invert, always invert." Instead of asking how to succeed, ask how to fail. So here are a few reliable ways to make sure crypto never becomes a $10 trillion market.
Today, we're inverting the question to find the path forward.👇
~~ Article by @kenzixbt ~~
Assume the World Cares About Our Chains
Since the inception of crypto, the industry has operated around chains. And for a long time, that was the correct thing to do. Chains are the foundation on which everything else runs. So it's very important that we get that part right.
And that's exactly what we did.
Over the first fifteen years of crypto, blockchains became the most heavily funded category in the industry. The smartest minds, from Satoshi to Vitalik to Anatoly, have spent the prime of their lives building blockchains the way they believed they should be built.
And this practice of building around chains has had lollapalooza effects on how everything else happens in the industry.
Value accrual has long been understood to accrue at the chain layer, popularized by the fat protocol thesis. Chain tokens have been the best performing assets in the history of crypto. From ETH to SOL to BNB, these have provided some of the best returns to investors over the last decade. Wallets became the most widely used interfaces in the industry, tools designed primarily to help users interact with what's happening onchain. Builders and users began organizing themselves around chains, gravitating toward the ecosystem that resonated with them.
This framing has worked really well for us. The industry needed an anchor in crypto's early years. Chains became that anchor. They became flagbearers for different versions of the crypto ethos, each optimizing for a different set of trade-offs. Crypto is now a $4 trillion market.
All of this made sense. But this moment should also mark the beginning of the end of the idea that crypto should revolve around chains. Because today, this same framing is starting to work against us.
And the simple reason is fragmentation.
Fragmentation of liquidity. Fragmentation of capital. Fragmentation of users. Fragmentation of talent. Fragmentation of attention.
Under chain-first thinking, we're fragmented at the core and operate in isolation. We behave as if things happen in isolation in this industry. While in reality, crypto is a tightly coupled collection of small markets, which together operate as a single universal market.
Think about this question posed by a16z crypto's X account: Which chains are you building on? It shows exactly what's wrong with this thinking around chains.
Why does it matter if someone is building on Ethereum or Solana or xyz chain? What matters is that they're building in crypto. It's one market.
Yet because we frame crypto as a collection of separate chains, we allocate resources accordingly. Liquidity, capital, users, and builders are spread thin across different environments, each optimizing its own walled garden. That local optimization comes at the expense of global outcomes.
This is the inversion we need to make as an industry.
We need to stop building for our chains and start building for crypto. Otherwise, we risk optimizing individual pieces while stifling the growth of the market as a whole.
The analogy we can learn from is countries.
Countries are divided into states to improve local execution, but they compete and operate as a single economy on the global stage. The states work together as a united front. No serious country optimizes its states at the expense of its national market.
Crypto needs a similar unification moment.
Chains are the states. Crypto is the country. We're all divided into states like chains, but we're all part of one big country called crypto—and we have to come together as a united front to make crypto a bigger market.
Markets, not chains. That should be the rallying call for the future of crypto.
To the outside world, this is already the truth. When institutions, fintechs, governments, or consumer platforms evaluate crypto, they don't see chains, they see a large, growing market.
If we want the next leg of adoption, we have to align with that reality and be willing to set aside internal incentives, tribal loyalties, and bag bias. That means convincing the world why crypto as a market is a massive opportunity: to rebuild financial rails onchain. Rails that are globally accessible, rooted in transparent public ledgers, and that move value faster and cheaper for everyone.
Build Things and Wait for People to Come
One of the lazier criticisms of crypto is that it hasn't built anything people actually want. I don't buy it.
That narrative is consensus because it's easy to take a shot on crypto. In reality, it starts from the wrong expectations and applies the wrong mental model.
It assumes crypto should have produced consumer social apps, when in reality crypto has been rebuilding the financial layer of the world from scratch—so it's inevitable that we have applications that look financial and speculative by nature.
And I think that's the actual innovation of crypto.
Crypto embeds the ability to move value directly into the internet layer. This was missing from the world and we're changing that. Any crypto application will, in some form, express that property.
Crypto has built a lot of cool things. But the negative outlook comes from the fact that all of them are financial primitives or linked to speculation somehow. But on that point, I'd like to point that the whole world operates on speculation, and crypto is rebuilding the legacy financial system from scratch with new principles.
So it's no surprise that the most widely used crypto applications today include trading terminals, exchange frontends, leverage platforms, and memecoin markets. From the outside, this looks like financial nihilism. But in reality, it's just crypto serving the needs of the world.
In doing so, we've created entirely new markets. Memecoins turn attention and internet culture into tradeable assets. Prediction markets present a way to speculate on the events of the world. NFTs created a native digital form for art and ownership rights. DeFi rebuilt lending and borrowing without credit scores, replacing reputation with collateral and math.
But where the industry does face a real challenge now is not application building, but distribution.
Up to this point, crypto could grow by building better technology and assuming users would eventually show up. That phase is over. From here on, growth depends on whether we can reach people who don't already care about crypto.
Hence, crypto has a distribution challenge. Our problem is simple but hard to solve: how do we market to the world that doesn't live on crypto twitter?
Right now, crypto marketing is overwhelmingly inward-facing. We talk to builders, traders, and power users on Crypto Twitter and convince ourselves we're "educating the market." In reality, we're preaching to the same audience over and over again.
I think we need distribution channels that already reach the mainstream. And a lot of you will hate me for saying this but, centralized exchanges have the reach, trust and familiarity to take crypto mainstream:
They have the household name brand recognition already. They have revenues and marketing budgets that allow them to market to the mainstream. They have products that the average investor wants.
Think about it: How many people outside of crypto know about Uniswap? Very few. How many people outside of crypto know about Binance / Coinbase? A lot.
So maybe CEXs become the gateway for onboarding the next wave of users. But the lesson to take from CEXs for crypto's growth is that we need to prioritize distribution and market crypto to the world in simple terms. Build trusted brands and market to the average investor and not just the average crypto bro.
From here on, crypto's success depends less on better protocols and more on better communication. We need to think like marketers, not just builders. If we want adoption, we have to make crypto legible, desirable, and accessible to the rest of the world, and actively bring users in instead of waiting for them to show up.
Sell Our Soul to the Suits
One quick way to make sure crypto fails is to sell out to the suits at the finish line.
After spending fifteen years proving that crypto deserves to be taken seriously, there will be a temptation to make compromises to "close the deal" with institutions. To soften positions in the name of pragmatism. To meet the market where it is.
That would be the biggest mistake we could make.
As institutions come onchain, it becomes even more important for crypto to hold the line on the things that actually make it valuable: self-custody, censorship resistance, permissionless access, and open participation.
Now that crypto has a seat at the table, the worst thing we could do is pretend those principles are negotiable.
If we do this, we will lose. Because if we remove what makes crypto fundamentally better, we'll be left competing with incumbents on their terms.
There are a few obvious ways this can go wrong.
Take stablecoins. They are simply a better way to move value over the internet: faster settlement, lower costs, global reach. Treating CBDCs as acceptable substitutes would undermine the entire point.
Or take private chains. People often push them as a reasonable middle ground to onboard institutions to crypto, but in reality, they're just mid-curving. Private chains sacrifice transparency and composability—and these are not acceptable trade-offs we should be willing to take. If institutions want to build in crypto, they should build things that align with the crypto ethos.
Crypto doesn't need to prove it belongs anymore. That argument is over.
Now we need to preserve the properties that made it worth adopting in the first place.
No trade-offs at the home stretch.
Conclusion
If crypto wants to fail to become a $10 trillion market, the playbook is clear:
Obsess over chains instead of markets. Fragment into walled gardens. Build applications without figuring out distribution. Abandon our ethos.
Instead of going down this forbidden path, we need to prioritize around the right things:
Markets matter more than chains. Applications matter more than infrastructure. Access to crypto as a market matters most. Doubling down on properties that make crypto, crypto.
Crypto doesn't need a miracle to get to $10 trillion. It just needs to stop doing the things that prevent it from getting there.
Invert those habits, and the rest takes care of itself.
Markets usually do.
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