56 posts tagged with "blockchain"

How to drop wallet friction, keep users flowing, and forecast the upside

What if your Web3 app had the same seamless sign-up flow as a modern Web2 service? That's the core promise of zkLogin on the Sui blockchain. It functions like OAuth for Sui, letting users sign in with familiar accounts from Google, Apple, X, and more. A zero-knowledge proof then securely links that Web2 identity to an on-chain Sui address—no wallet pop-ups, no seed phrases, no user churn.

The impact is real and immediate. With hundreds of thousands of zkLogin accounts already live, case studies report massive gains in user conversion, jumping from a dismal 17% to a healthy 42% after removing traditional wallet barriers. Let's break down how it works and what it can do for your project.

Why Wallets Kill First‑Time Conversion​

You've built a groundbreaking dApp, but your user acquisition funnel is leaking. The culprit is almost always the same: the "Connect Wallet" button. Standard Web3 onboarding is a maze of extension installations, seed phrase warnings, and crypto-jargon quizzes.

It’s a massive barrier for newcomers. UX researchers observed a staggering 87% drop-off the moment a wallet prompt appeared. In a telling experiment, simply re-routing that prompt to a later stage in the checkout process flipped the completion rate to 94%. Even for crypto-curious users, the primary fear is, “I might lose my funds if I click the wrong button.” Removing that single, intimidating step is the key to unlocking exponential growth.

How zkLogin Works (in Plain English)​

zkLogin elegantly sidesteps the wallet problem by using technologies every internet user already trusts. The magic happens behind the scenes in a few quick steps:

1. Ephemeral Key Pair: When a user wants to sign in, a temporary, single-session key pair is generated locally in their browser. Think of it as a temporary passkey, valid only for this session.
2. OAuth Dance: The user signs in with their Google, Apple, or other social account. Your app cleverly embeds a unique value (nonce) into this login request.
3. ZKP Service: After a successful login, a ZKP (Zero-Knowledge Proof) service generates a cryptographic proof. This proof confirms, "This OAuth token authorizes the owner of the temporary passkey," without ever revealing the user's personal identity on-chain.
4. Derive Address: The user's JWT (JSON Web Token) from the OAuth provider is combined with a unique salt to deterministically generate their permanent Sui address. The salt is kept private, either client-side or in a secure backend.
5. Submit Transaction: Your app signs transactions with the temporary key and attaches the ZK proof. Sui validators verify the proof on-chain, confirming the transaction's legitimacy without the user ever needing a traditional wallet.

Step‑by‑Step Integration Guide​

Ready to implement this? Here’s a quick guide using the TypeScript SDK. The principles are identical for Rust or Python.

1. Install SDK​

The @mysten/sui package includes all the zklogin helpers you'll need.

pnpm add @mysten/sui

2. Generate Keys & Nonce​

First, create an ephemeral keypair and a nonce tied to the current epoch on the Sui network.

const keypair = new Ed25519Keypair();
const { epoch } = await suiClient.getLatestSuiSystemState();
const nonce = generateNonce(keypair.getPublicKey(), Number(epoch) + 2, generateRandomness());

3. Redirect to OAuth​

Construct the appropriate OAuth login URL for the provider you're using (e.g., Google, Facebook, Apple) and redirect the user.

4. Decode JWT & Fetch User Salt​

After the user logs in and is redirected back, grab the id_token from the URL. Use it to fetch the user-specific salt from your backend, then derive their Sui address.

const jwt = new URLSearchParams(window.location.search).get('id_token')!;
const salt = await fetch('/api/salt?jwt=' + jwt).then(r => r.text());
const address = jwtToAddress(jwt, salt);

5. Request ZK Proof​

Send the JWT to a prover service to get the ZK proof. For development, you can use Mysten’s public prover. In production, you should host your own or use a service like Enoki.

const proof = await fetch('/api/prove', {
  method:'POST',
  body: JSON.stringify({ jwt, ... })
}).then(r => r.json());

6. Sign & Send​

Now, build your transaction, set the sender to the user's zkLogin address, and execute it. The SDK handles attaching the zkLoginInputs (the proof) automatically. ✨

const tx = new TransactionBlock();
tx.moveCall({ target:'0x2::example::touch_grass' }); // Any Move call
tx.setSender(address);
tx.setGasBudget(5_000_000);

await suiClient.signAndExecuteTransactionBlock({
  transactionBlock: tx,
  zkLoginInputs: proof // The magic happens here
});

7. Persist Session​

For a smoother user experience, encrypt and store the keypair and salt in IndexedDB or local storage. Remember to rotate them every few epochs for enhanced security.

KPI Projection Template​

The difference zkLogin makes isn't just qualitative; it's quantifiable. Compare a typical onboarding funnel with a zkLogin-powered one:

👉 What this means: For a campaign driving 10,000 unique visitors, that's the difference between 300 first-day on-chain actions and over 2,500.

Best Practices & Gotchas​

To create an even more seamless experience, keep these pro-tips in mind:

• Use Sponsored Transactions: Pay for your users' first few transaction fees. This removes all friction and delivers an incredible "aha" moment.
• Handle Salts Carefully: Changing a user's salt will generate a new address. Only do this if you control a reliable recovery path for them.
• Expose the Sui Address: After signup, show users their on-chain address. This empowers advanced users to import it into a traditional wallet later if they choose.
• Prevent Refresh Loops: Cache the JWT and ephemeral keypair until they expire to avoid asking the user to log in repeatedly.
• Monitor Prover Latency: Keep an eye on the proof-generation round-trip time. If it exceeds 2 seconds, consider hosting a regional prover to keep things snappy.

Where BlockEden.xyz Adds Value​

While zkLogin perfects the user-facing flow, scaling it introduces new backend challenges. That's where BlockEden.xyz comes in.

• API Layer: Our high-throughput, geo-routed RPC nodes ensure your zkLogin transactions are processed with minimal latency, regardless of user location.
• Observability: Get out-of-the-box dashboards to track key metrics like proof latency, success/fail ratios, and your conversion funnel's health.
• Compliance: For apps that bridge into fiat, our optional KYC module provides a compliant on-ramp directly from the user's verified identity.

Ready to Ship?​

The era of clunky, intimidating wallet flows is over. Spin up a zkLogin sandbox, plug in BlockEden’s full-node endpoint, and watch your sign-up graph bend upward—while your users never even have to hear the word “wallet.” 😉

1. Liquidity and Growth of Sui DeFi​

Figure: Sui’s DeFi TVL (blue line) and DEX volume (green bars) grew dramatically through Q2 2025.

Total Value Locked (TVL) Surge: The Sui network’s DeFi liquidity has grown explosively over the past year. From roughly $600M TVL in late 2024, Sui’s TVL rocketed to over $2 billion by mid-2025. In fact, Sui peaked at about $2.55B TVL on May 21, 2025 and sustained well above $2B for much of Q2. This ~300%+ increase (a 480% year-over-year rise from May 2023) firmly positions Sui among the top 10 blockchains by DeFi TVL, outpacing growth on networks like Solana. Major catalysts included institutional adoption and the integration of native USDC stablecoin support, which together attracted large capital inflows. Notably, Sui’s monthly DEX trading volumes have climbed into the top tier of all chains – exceeding $7–8 billion per month by mid-2025 (ranking ~8th industry-wide). The circulating stablecoin liquidity on Sui surpassed $1 billion in mid-2025, after growing 180% since the start of the year, indicating deepening on-chain liquidity. Cross-chain capital is flowing in as well; around $2.7B of assets have been bridged into Sui’s ecosystem, including Bitcoin liquidity (details below). This rapid growth trend underscores a year of net inflows and user expansion for Sui DeFi.

Major DEXs and Liquidity Providers: Decentralized exchanges form the backbone of Sui’s DeFi liquidity. The Cetus protocol – an automated market maker (AMM) and aggregator – has been a flagship DEX, offering stablecoin swaps and concentrated liquidity pools. Cetus consistently leads in volume (facilitating $12.8B+ in trades during Q2 2025 alone) while holding around $80M TVL. Another key player is Bluefin, a multi-faceted DEX that operates both a spot AMM and a perpetual futures exchange. Bluefin expanded its offerings in 2025 with innovative features: it introduced BluefinX, Sui’s first RFQ (request-for-quote) system for improved price execution, and even integrated high-frequency trading optimizations to narrow the gap between DEX and CEX performance. By Q2, Bluefin’s AMM held about $91M TVL and saw over $7.1B in quarterly spot volume. Momentum is another rising DEX – it launched a concentrated liquidity market maker (CLMM) that quickly amassed $107M in liquidity and generated ~$4.6B in trading volume shortly after launch. Sui’s DEX sector also includes MovEX (a hybrid AMM + order-book exchange) and Turbos (an early CLMM adopter), among others, each contributing to the diverse liquidity landscape. Notably, Sui supports a native on-chain central limit order book called DeepBook, co-developed with MovEX, which provides shared order-book liquidity to any Sui dApp. This combination of AMMs, aggregators, and an on-chain CLOB gives Sui one of the more robust DEX ecosystems in DeFi.

Lending Markets and Yield Protocols: Sui’s lending and borrowing platforms have attracted significant capital, making up a large share of the TVL. The Suilend protocol stands out as Sui’s largest DeFi platform, with roughly $700M+ in TVL by Q2 2025 (having crossed the $1B mark in early 2025). Suilend is an expansion of Solana’s Solend, brought to Sui’s Move runtime, and it quickly became the flagship money-market on Sui. It offers deposit and collateralized borrowing services for assets like SUI and USDC, and has innovated by launching companion products – for example, SpringSui (a liquid staking module) and STEAMM, an AMM that enables “superfluid” use of liquidity within the platform. By gamifying user engagement (through point campaigns and NFTs) and issuing a governance token $SEND with revenue-sharing, Suilend drove rapid adoption – reporting over 50,000 monthly active wallets by mid-2025. Close behind Suilend is Navi Protocol (also referred to as Astros), which similarly reached on the order of $600–700M TVL in its lending pools. Navi sets itself apart by blending lending markets with yield strategies and even Bitcoin DeFi integration: for example, Navi facilitated a campaign for users to stake xBTC (a BTC proxy on Sui) via the OKX Wallet, incentivizing Bitcoin holders to participate in Sui yield opportunities. Other notable lending platforms include Scallop (~$146M TVL) and AlphaLend (~$137M), which together indicate a competitive market for borrowing and lending on Sui. Yield aggregation has also started to take hold – protocols like AlphaFi and Kai Finance each manage tens of millions in assets (e.g. ~$40M TVL) to optimize yield across Sui farms. Though smaller in scale, these yield optimizers and structured products (e.g. MovEX’s structured yield vaults) add depth to Sui’s DeFi offerings by helping users maximize returns from the growing liquidity base.

Liquid Staking and Derivatives: In parallel, Sui’s liquid staking derivatives (LSDs) and derivative trading platforms represent an important slice of the ecosystem’s liquidity. Because Sui is a proof-of-stake chain, protocols like SpringSui, Haedal, and Volo have introduced tokens that wrap staked SUI, allowing stakers to remain liquid. SpringSui – launched by the Suilend team – quickly became the dominant LSD, holding about $189M in staked SUI by end of Q2. Together with Haedal ($150M) and others, Sui’s LSD platforms give users the ability to earn validator rewards while redeploying staking tokens into DeFi (for example, using staked-SUI as lending collateral or in yield farms). On the derivatives front, Sui now hosts multiple on-chain perpetual futures exchanges. We’ve mentioned Bluefin’s perp DEX (Bluefin Perps) which handled billions in quarterly volume. Additionally, Typus Finance launched Typus Perp (TLP) in Q2 2025, entering Sui’s perps market with an impressive debut. Sudo (with its ZO protocol integration) introduced gamified perpetual swaps and “intelligent” leveraged products, growing its user base and liquidity by over 100% last quarter. The Magma protocol even pioneered a new AMM model – an Adaptive Liquidity Market Maker (ALMM) – aiming for zero-slippage trades and greater capital efficiency in swaps. These innovative DEX and derivative designs are attracting liquidity of their own (e.g. Magma’s TVL doubled in Q2) and enhancing Sui’s reputation as a testbed for next-gen DeFi primitives.

Trends in Capital Inflow and Users: The overall liquidity trend on Sui has been strongly positive, fueled by both retail and institutional inflows. Sui’s growing credibility (e.g. HSBC and DBS Bank joining as network validators) and high performance have drawn in new capital. A significant portion of assets bridged into Sui are blue-chip tokens and stablecoins – for instance, Circle’s USDC launched natively on Sui, and Tether’s USDT became available via bridges, leading to a robust stablecoin mix (USDC ~$775M, USDT ~$100M circulating by Q2). Perhaps most notably, Bitcoin liquidity has entered Sui in size (via wrapped or staked BTC – detailed in Section 3), accounting for over 10% of TVL. On the user side, improved wallet support and abstraction (see Section 2) have spurred adoption. The popular Phantom wallet (with ~7M users) extended support to Sui, making it easier for the broad crypto community to access Sui dApps. Similarly, centralized exchange wallets like OKX and Binance integrated Sui DeFi features (e.g. Binance’s Chrome wallet added a Simple Yield integration featuring Sui’s Scallop protocol). These on-ramps contributed to Sui’s user growth: by early 2025 Sui had hundreds of thousands of active addresses, and top dApps like Suilend report tens of thousands of monthly users. Overall, liquidity on Sui has trended upward in 2025, supported by consistent inflows and expanding user participation – a stark contrast to the stagnation seen on some other chains during the same period.

2. Abstraction: Simplifying User Experience on Sui​

Account Abstraction Features: A cornerstone of Sui’s design is account abstraction, which vastly improves usability by hiding blockchain complexities from end-users. Unlike traditional Layer-1s where users must manage keys and gas for every transaction, Sui enables a smoother experience via native features. Specifically, Sui supports third-party credential logins and gas sponsorship at the protocol level. Developers can integrate zkLogin – allowing users to create a Sui wallet and log in with familiar Web2 credentials (Google, Facebook, Twitch, etc.) instead of seed phrases. Concurrently, Sui offers sponsored transactions, meaning dApp builders can pay gas fees on behalf of users through an on-chain “gas station” mechanism. Together, zkLogin and gas sponsorship remove two major pain points (seed phrase management and acquiring native tokens) for new users. A Sui user can, for example, sign up with an email/password (via OAuth) and start using a DeFi app immediately with no upfront SUI tokens needed. This level of abstraction mirrors Web2 ease-of-use and has been critical in onboarding the “next wave” of users who expect frictionless signup and free trial experiences. Many Sui apps and even Web3 games now leverage these features – a recent NFT game launch boasted a “zero-wallet login” flow for players, powered by Sui’s account abstraction and social login capabilities. Overall, by automating key management and gas handling, Sui significantly lowers the barrier to entry for DeFi, which in turn drives higher user retention and activity.

Smart Contract Abstraction and Move: Beyond login and transactions, Sui’s object-oriented programming model provides abstraction at the smart contract level. Sui’s native Move language treats objects (not externally owned accounts) as the basic unit of storage, with rich metadata and flexible ownership structures. This means developers can create smart contract objects that act as proxies for user accounts, automating tasks that would traditionally require user signatures. For example, an app on Sui can deploy a programmable object to handle recurring payments or complex multi-step trades on behalf of a user, without that user manually initiating each step. These objects can hold permissions and logic, effectively abstracting away repetitive actions from the end-user. Additionally, Sui introduced Programmable Transaction Blocks (PTBs) as a way to bundle multiple operations into a single transaction payload. Instead of requiring a user to sign and send 3–4 separate transactions (e.g. approve token, then swap, then stake), a Sui PTB can compose those steps and execute them all at once. This not only reduces friction and confirmation prompts for the user, but also improves performance (fewer on-chain transactions means lower total gas and faster execution). From the user’s perspective, a complex series of actions can feel like one smooth interaction – a critical improvement in UX. Sui’s Move was built with such composability and abstraction in mind, and it’s enabling developers to craft dApps that feel much more like traditional fintech apps. As an added bonus, Sui’s cryptographic agility supports multiple signature schemes (Ed25519, secp256k1, etc.), which allows wallets to use different key types (including those used on Ethereum or Bitcoin). This flexibility makes it easier to integrate Sui functionality into multi-chain wallets and even sets the stage for quantum-resistant cryptography down the line.

Cross-Chain Abstraction – Intents and Integration: Sui is breaking ground in cross-chain user experience through abstraction as well. A prime example is the July 2025 integration of NEAR Intents, a novel cross-chain coordination system, into Sui’s ecosystem. With this integration, Sui users can seamlessly swap assets across 20+ other chains (including Ethereum, Bitcoin, Solana, Avalanche, etc.) in a single step, without manual bridging. The underlying “intent” model means the user simply expresses what they want (e.g. “swap 1 ETH on Ethereum for SUI on Sui”) and a network of automated solvers finds the most efficient way to fulfill that request across chains. The user no longer needs to juggle multiple wallets or gas fees on different networks – the system abstracts all that away. Swapping assets into Sui becomes as easy as a one-click transaction, with no need to even hold gas tokens on the source chain. This is a significant UX leap for cross-chain DeFi. By mid-2025, NEAR Intents was live and Sui users could bring in outside liquidity within seconds, enabling use cases like cross-chain arbitrage and onboarding of assets from non-Sui holders with virtually no friction or custodial risk. Sui Foundation representatives highlighted that “swapping native assets in one click…abstracts away complexity while keeping everything on-chain, secure, and composable”. In parallel, Sui has benefited from major wallet integrations that hide complexity for users. As noted, Phantom’s multi-chain wallet now supports Sui, and other popular wallets like OKX and Binance Wallet have built-in support for Sui dApps. For instance, Binance’s wallet lets users directly access yield farms on Sui (via Scallop) through a simple interface, and OKX’s wallet integrated Sui’s BTC staking flows (Navi’s xBTC) natively. These integrations mean users can interact with Sui DeFi without switching apps or worrying about technical details – their familiar wallet abstracts it for them. All of these efforts, from intents-based swaps to wallet UIs, serve the goal of making cross-chain and on-chain DeFi feel effortless on Sui. The result is that Sui is increasingly accessible not just to crypto natives but also to mainstream users who demand simplicity.

User Experience Impact: Thanks to Sui’s abstraction layers, the user experience on Sui’s DeFi protocols has become one of the most user-friendly in blockchain. New users can onboard with a social login and no upfront cost, execute complex transactions with minimal confirmations, and even move assets from other chains with one-click swaps. This approach is fulfilling Sui’s mission of “familiar onboarding” and mass adoption. As a point of comparison, just as an iPhone user doesn’t need to understand Swift code to use an app, a Sui DeFi user shouldn’t need to grasp private keys or bridge mechanics. Sui’s account abstraction ethos embraces that philosophy, “offering a gateway to a seamless and gratifying user experience” for blockchain finance. By making Web3 interactions feel closer to Web2 in ease, Sui is lowering barriers for the next wave of DeFi users who value convenience. This user-centric design is a key factor in Sui’s growing adoption and sets the stage for greater mainstream participation in DeFi through 2025 and beyond.

3. The Next Wave of DeFi Primitives on Sui​

Proliferation of Native Stablecoins: A vibrant array of new stablecoins and asset-backed tokens is emerging on Sui, providing foundational building blocks for DeFi. In late 2024, Agora Finance’s AUSD went live as the first fully USD-backed stablecoin native to Sui. Marketed as an institutional-grade stablecoin, AUSD’s launch immediately added liquidity and was a boon for Sui’s DeFi growth (Sui’s TVL was about $600M when AUSD arrived and climbing). By mid-2025, AUSD had a circulating supply of tens of millions (with more on Ethereum and Avalanche) and became a regulated alternative to USDC/USDT within Sui’s ecosystem. Around the same time, the Bucket Protocol introduced BUCK, an over-collateralized stablecoin akin to DAI but for Sui. Users can mint BUCK by depositing SUI, BTC, ETH, and other assets as collateral. BUCK is pegged to USD and maintained via on-chain collateral ratios and stability mechanisms (Bucket features a Peg Stability Module, CDP vaults, etc., similar to MakerDAO). By Q2 2025, BUCK’s supply reached ~$60–66M, making it one of the largest Sui-native stablecoins (Bucket’s protocol TVL was ~$69M in that period, mostly backing BUCK). Another notable addition is USDY by Ondo Finance – a yield-bearing “stablecoin” that tokenizes short-term U.S. Treasury yields. Ondo deployed USDY onto Sui in early 2024, marking Sui’s foray into real-world asset (RWA) backed tokens. USDY is effectively a tokenized bond fund that accrues interest for holders (its price floats slightly, reflecting earned yield). This provides Sui users with a native, compliance-focused stable asset that generates yield without needing to stake or farm. By 2025, Sui’s stablecoin landscape also included First Digital USD (FDUSD), brought via partnerships in Asia, and wrapped versions of major stablecoins. The variety of stablecoin primitives – from decentralized CDP-backed (BUCK) to fully fiat-backed (AUSD) to yield-bearing (USDY) – is expanding on-chain liquidity and enabling new DeFi strategies (e.g. using BUCK as loan collateral, or holding USDY as a low-risk yield source). These stable assets form the bedrock for other protocols like DEXs and lenders to build upon, and their presence is a strong signal of a maturing DeFi ecosystem.

BTC DeFi (“BTCfi”) Innovations: Sui is at the forefront of making Bitcoin an active player in DeFi, coining the term BTCfi for Bitcoin-centric DeFi use cases. In 2025, multiple initiatives bridged Bitcoin’s liquidity and security into Sui’s network. One major step was the integration of Threshold Network’s tBTC on Sui. tBTC is a decentralized, 1:1 BTC-backed token that uses threshold cryptography (distributed signing) to avoid any single custodian. In July 2025, tBTC went live on Sui, immediately unlocking access to over $500M worth of BTC liquidity for Sui protocols. This means Bitcoin holders can now mint tBTC directly into Sui and deploy it in lending, trading, or yield farming without entrusting their BTC to a centralized bridge. Sui’s high-performance infrastructure (with sub-second finality) makes it an attractive home for these BTC assets. In parallel, Sui partnered with the Stacks ecosystem to support sBTC, another 1:1 BTC representation that piggybacks off Bitcoin’s security via the Stacks layer-2. By May 2025, over 10% of Sui’s TVL consisted of BTC or BTC-derived assets as bridges like Wormhole, Stacks, and Threshold ramped up Bitcoin connectivity. More than 600 BTC (>$65M) had flowed into Sui in just the first few months of 2025. These BTC derivatives unlock use cases such as using BTC as collateral on Sui’s lending platforms (indeed, Suilend held over $102M in Bitcoin-based assets by Q2, more than any other Sui lender). They also enable BTC trading pairs on Sui DEXs and allow Bitcoin holders to earn DeFi yields without giving up their BTC ownership. The concept of BTCfi is to transform Bitcoin from a “passive” store-of-value into an active capital asset – and Sui has embraced this by providing the technology (fast, parallel execution and an object model ideal for representing BTC custody) and forging partnerships to bring in Bitcoin liquidity. The Sui Foundation even began running a Stacks validator, signaling its commitment to BTC integration. In short, Bitcoin is now a first-class citizen in Sui DeFi, and this cross-pollination is a key innovation of 2025. It opens the door for new Bitcoin-backed stablecoins, Bitcoin yield products, and multi-chain strategies that bridge the gap between the Bitcoin network and DeFi on Sui.

Advanced DEX Primitives and HFT: The next wave of Sui DeFi primitives also includes novel exchange designs and financial instruments that go beyond the initial AMM models. We’ve seen earlier how Magma’s ALMM and Momentum’s CLMM are pushing AMMs toward greater capital efficiency (concentrating liquidity or dynamically adjusting it). Additionally, protocols are experimenting with high-performance trading features: Bluefin in particular rolled out functionalities aimed at institutional and high-frequency traders. In July 2025, Bluefin announced it was bringing institutional-grade high-frequency trading strategies to its Sui-based DEX, using Sui’s parallel execution to achieve throughput and latency improvements. This narrows the performance gap with centralized exchanges and could attract quantitative trading firms to provide liquidity on-chain. Such enhancements in execution speed, low slippage, and MEV protection (Bluefin’s Spot 2.0 upgrade is noted for MEV-resistant RFQ matching) are new primitives in exchange design that Sui is pioneering.

Meanwhile, derivatives and structured products on Sui are becoming more sophisticated. Typus expanding into perpetual futures and Sudo/ZO offering gamified perps were mentioned; these indicate a trend of blending DeFi with trading gamification and user-friendly interfaces. Another example is Nemo, which introduced a “yield trading” market and a points reward system in its new interface – essentially allowing users to speculate on yield rates and earn loyalty points, a creative twist on typical yield farming. We also see structured yield products: for instance, MovEX and others have discussed structured vaults that automatically rotate funds between strategies, giving users packaged investment products (akin to DeFi ETFs or tranches). These are in development and represent the next generation of yield farming, where complexity (like strategy hopping) is abstracted and offered as a single product.

New Financial Instruments & Partnerships: The Sui community and its partners are actively building entirely new DeFi primitives that could define the next phase of growth. One high-profile upcoming project is Graviton, which raised $50M in a Series A (led by a16z and Pantera) to create a modular trading, lending, and cross-margining platform on Sui. Graviton is often compared to dYdX – aiming to onboard professional traders with a full-suite decentralized trading experience (perpetuals, margin trading, lending markets all under one roof). Such a well-funded initiative underlines the confidence in Sui’s DeFi potential and promises a new primitive: a one-stop, high-performance DeFi “super app” on Sui. In addition, real-world finance is intersecting with Sui: the Sui Foundation has fostered partnerships like xMoney/xPortal to launch a crypto-powered MasterCard for retail users, which would allow spending Sui-based assets in everyday purchases. This kind of CeFi–DeFi bridge (essentially bringing DeFi liquidity to point-of-sale) could be transformative if it gains traction. On the institutional side, 21Shares filed for a SUI exchange-traded fund (ETF) in the US – while not a DeFi protocol, an ETF would give traditional investors exposure to Sui’s growth and indirectly to its DeFi economy.

The community and developer activity on Sui is another driving force for new primitives. Sui’s open-source Move ecosystem has grown so active that by mid-2025 Sui surpassed Solana and Near in weekly developer commits and repo forks, thanks to a surge in new tooling (e.g. Move SDKs, zk-proof integrations, cross-chain protocol development). This vibrant developer community is continually experimenting with ideas like on-chain options markets, decentralized insurance, and intent-based lending (some hackathon projects in 2025 tackled these areas). The results are starting to emerge: for example, Lotus Finance launched as a decentralized options AMM on Sui in Q2, and Turbos adopted decentralized front-end hosting (via Walrus) to push the envelope on censorship-resistant DeFi. Community-driven initiatives like these, alongside formal partnerships (e.g. Sui’s collaboration with Google Cloud to provide on-chain data indexing and AI inference tools), create a fertile ground for novel protocols. We’re seeing DeFi primitives on Sui that integrate AI oracles for dynamic pricing, BTC staking services (SatLayer), and even cross-chain intents (the NEAR Intents integration can be seen as a primitive for cross-chain liquidity). Each adds a building block that future developers can combine into new financial products.

Summary: In 2025, Sui’s DeFi ecosystem is flourishing with innovation. The liquidity on Sui has reached multi-billion dollar levels, anchored by major DEXes and lenders, and bolstered by steady inflows and user growth. Through account abstraction and user-centric design, Sui has dramatically improved the DeFi user experience, attracting a broader audience. And with the next wave of primitives – from native stablecoins and BTC integration to advanced AMMs, perps, and real-world asset tokens – Sui is expanding what’s possible in decentralized finance. Key protocols and community efforts are driving this evolution: Cetus and Bluefin advancing DEX tech, Suilend and others expanding lending into new asset classes, Bucket, Agora, Ondo bringing novel assets on-chain, and many more. High-profile partnerships (with infrastructure providers, TradFi institutions, and cross-chain networks) further amplify Sui’s momentum. All these elements point to Sui solidifying its position as a leading DeFi hub by 2025 – one characterized by deep liquidity, seamless usability, and relentless innovation in financial primitives.

Sources:

• Sui Foundation – Sui Q2 2025 DeFi Roundup (July 15, 2025)
• Sui Foundation – NEAR Intents Brings Lightning-Fast Cross-chain Swaps to Sui (July 17, 2025)
• Sui Foundation – Sui to Support sBTC and Stacks (BTCfi Use Cases) (May 1, 2025)
• Sui Foundation – All About Account Abstraction (Oct 4, 2023)
• Ainvest News – Sui Network TVL Surpasses $1.4B Driven by DeFi Protocols (Jul 14, 2025)
• Ainvest News – Sui DeFi TVL Surges 480% to $1.8B... (Jul 12, 2025)
• Suipiens (Sui community) – tBTC Integration Brings Bitcoin Liquidity to Sui (Jul 17, 2025)
• Suipiens – Inside Suilend: Sui’s Leading Lending Platform (Jul 3, 2025)
• The Defiant – Ondo to Bring RWA-Backed Stablecoins onto Sui (Feb 7, 2024)
• Official Sui Documentation – Intro to Sui: User Experience (account abstraction features)

The State of Blockchain APIs 2025 report (by BlockEden.xyz) provides a comprehensive look at the blockchain API infrastructure landscape. It examines emerging trends, market growth, major providers, supported blockchains, developer adoption, and critical factors like security, decentralization, and scalability. It also highlights how blockchain API services are powering various use cases (DeFi, NFTs, gaming, enterprise) and includes commentary on industry directions. Below is a structured summary of the report’s findings, with comparisons of leading API providers and direct citations from the source for verification.

Trends in Blockchain API Infrastructure (2025)​

The blockchain API ecosystem in 2025 is shaped by several key trends and technological advancements:

• Multi-Chain Ecosystems: The era of a single dominant blockchain is over – hundreds of Layer-1s, Layer-2s, and app-specific chains exist. Leading providers like QuickNode now support ~15–25 chains, but in reality “five to six hundred blockchains (and thousands of sub-networks) [are] active in the world”. This fragmentation drives demand for infrastructure that abstracts complexity and offers unified multi-chain access. Platforms that embrace new protocols early can gain first-mover advantage, as more scalable chains unlock new on-chain applications and developers increasingly build across multiple chains. In 2023 alone, ~131 different blockchain ecosystems attracted new developers, underscoring the multi-chain trend.

• Developer Community Resilience and Growth: The Web3 developer community remains substantial and resilient despite market cycles. As of late 2023 there were over 22,000 monthly active open-source crypto developers, a slight dip (~25% YoY) after the 2021 hype, but notably the number of experienced “veteran” developers grew by ~15%. This indicates a consolidation of serious, long-term builders. These developers demand reliable, scalable infrastructure and cost-effective solutions, especially in a tighter funding environment. With transaction costs dropping on major chains (thanks to L2 rollups) and new high-throughput chains coming online, on-chain activity is hitting all-time highs – further fueling demand for robust node and API services.

• Rise of Web3 Infrastructure Services: Blockchain infrastructure has matured into its own segment, attracting significant venture funding and specialized providers. QuickNode, for example, distinguished itself with high performance (reported 2.5× faster than some competitors) and 99.99% uptime SLAs, winning enterprise clients like Google and Coinbase. Alchemy achieved a $10 B valuation at the market peak, reflecting investor enthusiasm. This influx of capital has spurred rapid innovation in managed nodes, RPC APIs, indexing/analytics, and developer tools. Traditional cloud giants (AWS, Azure, Google Cloud) are also entering the fray with blockchain node hosting and managed ledger services. This validates the market opportunity but raises the bar for smaller providers to deliver on reliability, scale, and enterprise features.

• Decentralization Push (Infrastructure): Counter to the trend of big centralized providers, there’s a movement toward decentralized infrastructure in line with Web3’s ethos. Projects like Pocket Network, Ankr, and Blast (Bware) offer RPC endpoints via distributed node networks with crypto-economic incentives. These decentralized APIs can be cost-effective and censorship-resistant, though often still trailing centralized services in performance and ease-of-use. The report notes that “while centralized services currently lead in performance, the ethos of Web3 favors disintermediation.” BlockEden’s own vision of an open “API marketplace” with permissionless access (eventually token-governed) aligns with this push, seeking to combine the reliability of traditional infrastructure with the openness of decentralized networks. Ensuring open self-service onboarding (e.g. generous free tiers, instant API key signup) has become an industry best practice to attract grassroots developers.

• Convergence of Services & One-Stop Platforms: Providers are broadening their offerings beyond basic RPC endpoints. There’s growing demand for enhanced APIs and data services – e.g. indexed data (for faster queries), GraphQL APIs, token/NFT APIs, analytics dashboards, and even integrations of off-chain data or AI services. For example, BlockEden provides GraphQL indexer APIs for Aptos, Sui, and Stellar Soroban to simplify complex queries. QuickNode acquired NFT API tools (e.g. Icy Tools) and launched an add-on marketplace. Alchemy offers specialized APIs for NFTs, tokens, transfers, and even an account abstraction SDK. This “one-stop-shop” trend means developers can get nodes + indexing + storage + analytics from a single platform. BlockEden has even explored “permissionless LLM inference” (AI services) in its infrastructure. The goal is to attract developers with a rich suite of tools so they don’t need to stitch together multiple vendors.

Market Size and Growth Outlook (2025)​

The report paints a picture of robust growth for the blockchain API/infrastructure market through 2025 and beyond:

• The global Web3 infrastructure market is projected to grow at roughly 49% CAGR from 2024 to 2030, indicating enormous investment and demand in the sector. This suggests the overall market size could double every ~1.5–2 years at that rate. (For context, an external Statista forecast cited in the report estimates the broader digital asset ecosystem reaching ~$45.3 billion by end of 2025, underscoring the scale of the crypto economy that infrastructure must support.)

• Driving this growth is the pressure on businesses (both Web3 startups and traditional firms) to integrate crypto and blockchain capabilities. According to the report, dozens of Web2 industries (e-commerce, fintech, gaming, etc.) now require crypto exchange, payment, or NFT functionality to stay competitive, but building such systems from scratch is difficult. Blockchain API providers offer turnkey solutions – from wallet and transaction APIs to fiat on/off-ramps – that bridge traditional systems with the crypto world. This lowers the barrier for adoption, fueling more demand for API services.

• Enterprise and institutional adoption of blockchain is also rising, further expanding the market. Clearer regulations and success stories of blockchain in finance and supply chain have led to more enterprise projects by 2025. Many enterprises prefer not to run their own nodes, creating opportunities for infrastructure providers with enterprise-grade offerings (SLA guarantees, security certifications, dedicated support). For instance, Chainstack’s SOC2-certified infrastructure with 99.9% uptime SLA and single sign-on appeals to enterprises seeking reliability and compliance. Providers that capture these high-value clients can significantly boost revenue.

In summary, 2025’s outlook is strong growth for blockchain APIs – the combination of an expanding developer base, new blockchains launching, increasing on-chain activity, and mainstream integration of crypto services all drive a need for scalable infrastructure. Both dedicated Web3 firms and tech giants are investing heavily to meet this demand, indicating a competitive but rewarding market.

Leading Blockchain API Providers – Features & Comparison​

Several key players dominate the blockchain API space in 2025, each with different strengths. The BlockEden report compares BlockEden.xyz (the host of the report) with other leading providers such as Alchemy, Infura, QuickNode, and Chainstack. Below is a comparison in terms of supported blockchains, notable features, performance/uptime, and pricing:

Sources: The above comparison integrates data and quotes from the BlockEden.xyz report, as well as documented features from provider websites (e.g. Alchemy and Chainstack docs) for accuracy.

Blockchain Coverage and Network Support​

One of the most important aspects of an API provider is which blockchains it supports. Here is a brief coverage of specific popular chains and how they are supported:

• Ethereum Mainnet & L2s: All the leading providers support Ethereum. Infura and Alchemy specialize heavily in Ethereum (with full archive data, etc.). QuickNode, BlockEden, and Chainstack also support Ethereum as a core offering. Layer-2 networks like Polygon, Arbitrum, Optimism, Base are supported by Alchemy, QuickNode, and Chainstack, and by Infura (as paid add-ons). BlockEden supports Polygon (and Polygon zkEVM) and is likely to add more L2s as they emerge.

• Solana: Solana is supported by BlockEden (they added Solana in 2023), QuickNode, and Chainstack. Alchemy also added Solana RPC in 2022. Infura does not support Solana (at least as of 2025, it remains focused on EVM networks).

• Bitcoin: Being a non-EVM, Bitcoin is notably not supported by Infura or Alchemy (which concentrate on smart contract chains). QuickNode and Chainstack both offer Bitcoin RPC access, giving developers access to Bitcoin data without running a full node. BlockEden currently does not list Bitcoin among its supported networks (it focuses on smart contract platforms and newer chains).

• Polygon & BNB Chain: These popular Ethereum sidechains are widely supported. Polygon is available on BlockEden, Alchemy, Infura (premium), QuickNode, and Chainstack. BNB Smart Chain (BSC) is supported by BlockEden (BSC), QuickNode, and Chainstack. (Alchemy and Infura do not list BSC support, as it’s outside the Ethereum/consensus ecosystem they focus on.)

• Emerging Layer-1s (Aptos, Sui, etc.): This is where BlockEden.xyz shines. It was an early provider for Aptos and Sui, offering RPC and indexer APIs for these Move-language chains at launch. Many competitors did not initially support them. By 2025, some providers like Chainstack have added Aptos and others to their lineup, but BlockEden remains highly regarded in those communities (the report notes BlockEden’s Aptos GraphQL API “cannot be found anywhere else” according to users). Supporting new chains quickly can attract developer communities early – BlockEden’s strategy is to fill the gaps where developers have limited options on new networks.

• Enterprise (Permissioned) Chains: Uniquely, Chainstack supports Hyperledger Fabric, Corda, Quorum, and Multichain, which are important for enterprise blockchain projects (consortia, private ledgers). Most other providers do not cater to these, focusing on public chains. This is part of Chainstack’s enterprise positioning.

In summary, Ethereum and major EVM chains are universally covered, Solana is covered by most except Infura, Bitcoin only by a couple (QuickNode/Chainstack), and newer L1s like Aptos/Sui by BlockEden and now some others. Developers should choose a provider that covers all the networks their dApp needs – hence the advantage of multi-chain providers. The trend toward more chains per provider is clear (e.g. QuickNode ~14, Chainstack 50–70+, Blockdaemon 50+, etc.), but depth of support (robustness on each chain) is equally crucial.

Developer Adoption and Ecosystem Maturity​

The report provides insight into developer adoption trends and the maturity of the ecosystem:

• Developer Usage Growth: Despite the 2022–2023 bear market, on-chain developer activity remained strong. With ~22k monthly active devs in late 2023 (and likely growing again in 2024/25), the demand for easy-to-use infrastructure is steady. Providers are competing not just on raw tech, but on developer experience to attract this base. Features like extensive docs, SDKs, and community support are now expected. For example, BlockEden’s community-centric approach (Discord, 10x.pub guild, hackathons) and QuickNode’s education initiatives aim to build loyalty.

• Free Tier Adoption: The freemium model is driving widespread grassroots usage. Nearly all providers offer a free tier that covers basic project needs (millions of requests per month). The report notes BlockEden’s free tier of 10M daily CUs is deliberately high to remove friction for indie devs. Alchemy and Infura’s free plans (around 3–4M calls per month) helped onboard hundreds of thousands of developers over the years. This strategy seeds the ecosystem with users who can later convert to paid plans as their dApps gain traction. The presence of a robust free tier has become an industry standard – it lowers the barrier for entry, encouraging experimentation and learning.

• Number of Developers on Platforms: Infura historically had the largest user count (over 400k developers as of a few years ago) since it was an early default. Alchemy and QuickNode also grew large user bases (Alchemy’s outreach via its education programs and QuickNode’s focus on Web3 startups helped them sign up many thousands). BlockEden, being newer, reports a community of 6,000+ developers using its platform. While smaller in absolute terms, this is significant given its focus on newer chains – it indicates strong penetration in those ecosystems. The report sets a goal of doubling BlockEden’s active developers by next year, reflecting the overall growth trajectory of the sector.

• Ecosystem Maturity: We are seeing a shift from hype-driven adoption (many new devs flooding in during bull runs) to a more sustainable, mature growth. The drop in “tourist” developers after 2021 means those who remain are more serious, and new entrants in 2024–2025 are often backed by better understanding. This maturation demands more robust infrastructure: experienced teams expect high uptime SLAs, better analytics, and support. Providers have responded by professionalizing services (e.g., offering dedicated account managers for enterprise, publishing status dashboards, etc.). Also, as ecosystems mature, usage patterns are better understood: for instance, NFT-heavy applications might need different optimizations (caching metadata etc.) than DeFi trading bots (needing mempool data and low latency). API providers now offer tailored solutions (e.g. Chainstack’s aforementioned “Trader Node” for low-latency trading data). The presence of industry-specific solutions (gaming APIs, compliance tools, etc., often available through marketplaces or partners) is a sign of a maturing ecosystem serving diverse needs.

• Community and Support: Another aspect of maturity is the formation of active developer communities around these platforms. QuickNode and Alchemy have community forums and Discords; BlockEden’s community (with 4,000+ Web3 builders in its guild) spans Silicon Valley to NYC and globally. This peer support and knowledge sharing accelerates adoption. The report highlights “exceptional 24/7 customer support” as a selling point of BlockEden, with users appreciating the team’s responsiveness. As the tech becomes more complex, this kind of support (and clear documentation) is crucial for onboarding the next wave of developers who may not be as deeply familiar with blockchain internals.

In summary, developer adoption is expanding in a more sustainable way. Providers that invest in the developer experience – free access, good docs, community engagement, and reliable support – are reaping the benefits of loyalty and word-of-mouth in the Web3 dev community. The ecosystem is maturing, but still has plenty of room to grow (new developers entering from Web2, university blockchain clubs, emerging markets, etc., are all targets mentioned for 2025 growth).

Security, Decentralization, and Scalability Considerations​

The report discusses how security, decentralization, and scalability factor into blockchain API infrastructure:

• Reliability & Security of Infrastructure: In the context of API providers, security refers to robust, fault-tolerant infrastructure (since these services do not usually custody funds, the main risks are downtime or data errors). Leading providers emphasize high uptime, redundancy, and DDoS protection. For example, QuickNode’s 99.99% uptime SLA and global load balancing are meant to ensure a dApp doesn’t go down due to an RPC failure. BlockEden cites its 99.9% uptime track record and the trust gained by managing $65M in staked assets securely (implying strong operational security for their nodes). Chainstack’s SOC2 compliance indicates a high standard of security practices and data handling. Essentially, these providers run mission-critical node infrastructure so they treat reliability as paramount – many have 24/7 on-call engineers and monitoring across all regions.

• Centralization Risks: A well-known concern in the Ethereum community is over-reliance on a few infrastructure providers (e.g., Infura). If too much traffic funnels through a single provider, outages or API malfeasance could impact a large portion of the decentralized app ecosystem. The 2025 landscape is improving here – with many strong competitors, the load is more distributed than in 2018 when Infura was almost singular. Nonetheless, the push for decentralization of infra is partly to address this. Projects like Pocket Network (POKT) use a network of independent node runners to serve RPC requests, removing single points of failure. The trade-off has been performance and consistency, but it’s improving. Ankr’s hybrid model (some centralized, some decentralized) similarly aims to decentralize without losing reliability. The BlockEden report acknowledges these decentralized networks as emerging competitors – aligning with Web3 values – even if they aren’t yet as fast or developer-friendly as centralized services. We may see more convergence, e.g., centralized providers adopting some decentralized verification (BlockEden’s vision of a tokenized marketplace is one such hybrid approach).

• Scalability and Throughput: Scalability is two-fold: the ability of the blockchains themselves to scale (higher TPS, etc.) and the ability of infrastructure providers to scale their services to handle growing request volumes. On the first point, 2025 sees many L1s/L2s with high throughput (Solana, new rollups, etc.), which means APIs must handle bursty, high-frequency workloads (e.g., a popular NFT mint on Solana can generate thousands of TPS). Providers have responded by improving their backend – e.g., QuickNode’s architecture to handle billions of requests per day, Chainstack’s “Unlimited” nodes, and BlockEden’s use of both cloud and bare-metal servers for performance. The report notes that on-chain activity hitting all-time highs is driving demand for node services, so scalability of the API platform is crucial. Many providers now showcase their throughput capabilities (for instance, QuickNode’s higher-tier plans allowing billions of requests, or Chainstack highlighting “unbounded performance” in their marketing).

• Global Latency: Part of scalability is reducing latency by geographic distribution. If an API endpoint is only in one region, users across the globe will have slower responses. Thus, geo-distributed RPC nodes and CDNs are standard now. Providers like Alchemy and QuickNode have data centers across multiple continents. Chainstack offers regional endpoints (and even product tiers specifically for latency-sensitive use cases). BlockEden also runs nodes in multiple regions to enhance decentralization and speed (the report mentions plans to operate nodes across key regions to improve network resilience and performance). This ensures that as user bases grow worldwide, the service scales geographically.

• Security of Data and Requests: While not explicitly about APIs, the report briefly touches on regulatory and security considerations (e.g., BlockEden’s research into the Blockchain Regulatory Certainty Act indicating attention to compliant operations). For enterprise clients, things like encryption, secure APIs, and maybe ISO certifications can matter. On a more blockchain-specific note, RPC providers can also add security features like frontrunning protection (some offer private TX relay options) or automated retries for failed transactions. Coinbase Cloud and others have pitched “secure relay” features. The report’s focus is more on infrastructure reliability as security, but it’s worth noting that as these services embed deeper into financial apps, their security posture (uptime, attack resistance) becomes part of the overall security of the Web3 ecosystem.

In summary, scalability and security are being addressed through high-performance infrastructure and diversification. The competitive landscape means providers strive for the highest uptime and throughput. At the same time, decentralized alternatives are growing to mitigate centralization risk. The combination of both will likely define the next stage: a blend of reliable performance with decentralized trustlessness.

Use Cases and Applications Driving API Demand​

Blockchain API providers service a wide array of use cases. The report highlights several domains that are notably reliant on these APIs in 2025:

• Decentralized Finance (DeFi): DeFi applications (DEXs, lending platforms, derivatives, etc.) rely heavily on reliable blockchain data. They need to fetch on-chain state (balances, smart contract reads) and send transactions continuously. Many top DeFi projects use services like Alchemy or Infura to scale. For example, Aave and MakerDAO use Alchemy infrastructure. APIs also provide archive node data needed for analytics and historical queries in DeFi. With DeFi continuing to grow, especially on Layer-2 networks and multi-chain deployments, having multi-chain API support and low latency is crucial (e.g., arbitrage bots benefit from mempool data and fast transactions – some providers offer dedicated low-latency endpoints for this reason). The report implies that lowering costs (via L2s and new chains) is boosting on-chain DeFi usage, which in turn increases API calls.

• NFTs and Gaming: NFT marketplaces (like OpenSea) and blockchain games generate significant read volume (metadata, ownership checks) and write volume (minting, transfers). OpenSea is a notable Alchemy customer, likely due to Alchemy’s NFT API which simplifies querying NFT data across Ethereum and Polygon. QuickNode’s cross-chain NFT API is also aimed at this segment. Blockchain games often run on chains like Solana, Polygon, or specific sidechains – providers that support those networks (and offer high TPS handling) are in demand. The report doesn’t explicitly name gaming clients, but it mentions Web3 gaming and metaverse projects as growing segments (and BlockEden’s own support for things like AI integration could relate to gaming/NFT metaverse apps). In-game transactions and marketplaces constantly ping node APIs for state updates.

• Enterprise & Web2 Integration: Traditional companies venturing into blockchain (payments, supply chain, identity, etc.) prefer managed solutions. The report notes that fintech and e-commerce platforms are adding crypto payments and exchange features – many of these use third-party APIs rather than reinvent the wheel. For example, payment processors can use blockchain APIs for crypto transfers, or banks can use node services to query chain data for custody solutions. The report suggests increasing interest from enterprises and even mentions targeting regions like the Middle East and Asia where enterprise blockchain adoption is rising. A concrete example: Visa has worked with QuickNode for some blockchain pilots, and Meta (Facebook) uses Alchemy for certain blockchain projects. Enterprise use cases also include analytics and compliance – e.g., querying blockchain for risk analysis, which some providers accommodate through custom APIs or by supporting specialized chains (like Chainstack supporting Corda for trade finance consortia). BlockEden’s report indicates that landing a few enterprise case studies is a goal to drive mainstream adoption.

• Web3 Startups and DApps: Of course, the bread-and-butter use case is any decentralized application – from wallets to social dApps to DAOs. Web3 startups rely on API providers to avoid running nodes for each chain. Many hackathon projects use free tiers of these services. Areas like Decentralized Social Media, DAO tooling, identity (DID) systems, and infrastructure protocols themselves all need reliable RPC access. The report’s growth strategy for BlockEden specifically mentions targeting early-stage projects and hackathons globally – indicating that a constant wave of new dApps is coming online that prefer not to worry about node ops.

• Specialized Services (AI, Oracles, etc.): Interestingly, the convergence of AI and blockchain is producing use cases where blockchain APIs and AI services intersect. BlockEden’s exploration of “AI-to-earn” (Cuckoo Network partnership) and permissionless AI inference on its platform shows one angle. Oracles and data services (Chainlink, etc.) might use base infrastructure from these providers as well. While not a traditional “user” of APIs, these infrastructure layers themselves sometimes build on each other – for instance, an analytics platform may use a blockchain API to gather data to feed to its users.

Overall, the demand for blockchain API services is broad – from hobbyist developers to Fortune 500 companies. DeFi and NFTs were the initial catalysts (2019–2021) that proved the need for scalable APIs. By 2025, enterprise and novel Web3 sectors (social, gaming, AI) are expanding the market further. Each use case has its own requirements (throughput, latency, historical data, security) and providers are tailoring solutions to meet them.

Notably, the report includes quotes and examples from industry leaders that illustrate these use cases:

• “Over 1,000 coins across 185 blockchains are supported… allowing access to 330k+ trade pairs,” one exchange API provider touts – highlighting the depth of support needed for crypto exchange functionality.
• “A partner reported a 130% increase in monthly txn volume in four months” after integrating a turnkey API – underlining how using a solid API can accelerate growth for a crypto business.
• The inclusion of such insights underscores that robust APIs are enabling real growth in applications.

Industry Insights and Commentary​

The BlockEden report is interwoven with insights from across the industry, reflecting a consensus on the direction of blockchain infrastructure. Some notable commentary and observations:

• Multi-chain Future: As quoted in the report, “the reality is there are five to six hundred blockchains” out there. This perspective (originally from Electric Capital’s developer report or a similar source) emphasizes that the future is plural, not singular. Infrastructure must adapt to this fragmentation. Even the dominant providers acknowledge this – e.g., Alchemy and Infura (once almost solely Ethereum-focused) are now adding multiple chains, and venture capital is flowing to startups focusing on niche protocol support. The ability to support many chains (and to do so quickly as new ones emerge) is viewed as a key success factor.

• Importance of Performance: The report cites QuickNode’s performance edge (2.5× faster) which likely comes from a benchmarking study. This has been echoed by developers – latency and speed matter, especially for end-user facing apps (wallets, trading platforms). Industry leaders often stress that web3 apps must feel as smooth as web2, and that starts with fast, reliable infrastructure. Thus, the arms race in performance (e.g., globally distributed nodes, optimized networking, mempool acceleration) is expected to continue.

• Enterprise Validation: The fact that household names like Google, Coinbase, Visa, Meta are using or investing in these API providers is a strong validation of the sector. It’s mentioned that QuickNode attracted major investors like SoftBank and Tiger Global, and Alchemy’s $10B valuation speaks for itself. Industry commentary around 2024/2025 often noted that “picks-and-shovels” of crypto (i.e., infrastructure) were a smart play even during bear markets. This report reinforces that notion: the companies providing the underpinnings of Web3 are becoming critical infrastructure companies in their own right, drawing interest from traditional tech firms and VCs.

• Competitive Differentiation: There’s a nuanced take in the report that no single competitor offers the exact combination of services BlockEden does (multi-chain APIs + indexing + staking). This highlights how each provider is carving a niche: Alchemy with dev tools, QuickNode with pure speed and breadth, Chainstack with enterprise/private chain focus, BlockEden with emerging chains and integrated services. Industry leaders often comment that the pie is growing, so differentiation is key to capturing certain segments rather than a winner-takes-all scenario. The presence of Moralis (web3 SDK approach) and Blockdaemon/Coinbase Cloud (staking-heavy approach) further proves the point – different strategies to infrastructure exist.

• Decentralization vs. Centralization: Thought leaders in the space (like Ethereum’s Vitalik Buterin) have frequently raised concerns about reliance on centralized APIs. The report’s discussion of Pocket Network and others mirrors those concerns and shows that even companies running centralized services are planning for a more decentralized future (BlockEden’s tokenized marketplace concept, etc.). An insightful comment from the report is that BlockEden aims to offer “the reliability of centralized infra with the openness of a marketplace” – an approach likely applauded by decentralization proponents if achieved.

• Regulatory Climate: While not a focus of the question, it’s worth noting the report touches on regulatory and legal issues in passing (the mention of the Blockchain Regulatory Certainty Act, etc.). This implies that infrastructure providers are keeping an eye on laws that might affect node operation or data privacy. For instance, Europe’s GDPR and how it applies to node data, or US regulations on running blockchain services. Industry commentary on this suggests that clearer regulation (e.g., defining that non-custodial blockchain service providers aren’t money transmitters) will further boost the space by removing ambiguity.

Conclusion: The State of Blockchain APIs 2025 is one of a rapidly evolving, growing infrastructure landscape. Key takeaways include the shift to multi-chain support, a competitive field of providers each with unique offerings, massive growth in usage aligned with the overall crypto market expansion, and an ongoing tension (and balance) between performance and decentralization. Blockchain API providers have become critical enablers for all kinds of Web3 applications – from DeFi and NFTs to enterprise integrations – and their role will only expand as blockchain technology becomes more ubiquitous. The report underscores that success in this arena requires not only strong technology and uptime, but also community engagement, developer-first design, and agility in supporting the next big protocol or use case. In essence, the “state” of blockchain APIs in 2025 is robust and optimistic: a foundational layer of Web3 that is maturing quickly and primed for further growth.

Sources: This analysis is based on the State of Blockchain APIs 2025 report by BlockEden.xyz and related data. Key insights and quotations have been drawn directly from the report, as well as supplemental information from provider documentation and industry articles for completeness. All source links are provided inline for reference.

The rise of generative AI has been nothing short of explosive. From stunning digital art to human-like text, AI is creating content at an unprecedented scale. But this boom has a dark side: where does the AI get its training data? Often, it's from the vast expanse of the internet—from art, music, and writing created by humans who receive no credit or compensation.

Enter Camp Network, a new blockchain project that aims to solve this fundamental problem. It’s not just another crypto platform; it's a purpose-built "Autonomous IP Layer" designed to give creators ownership and control over their work in the age of AI. Let's dive into what makes Camp Network a project to watch.

What's the Big Idea?​

At its core, Camp Network is a blockchain that acts as a global, verifiable registry for intellectual property (IP). The mission is to allow anyone—from an independent artist to a social media user—to register their content on-chain. This creates a permanent, tamper-proof record of ownership and provenance.

Why does this matter? When an AI model uses content registered on Camp, the network's smart contracts can automatically enforce licensing terms. This means the original creator can get attribution and even receive royalty payments instantly. Camp's vision is to build a new creator economy where compensation isn't an afterthought; it's built directly into the protocol.

Under the Hood: The Technology Stack​

Camp isn't just a concept; it's backed by some serious tech designed for high performance and developer-friendliness.

• Modular Architecture: Camp is built as a sovereign rollup using Celestia for data availability. This design allows it to be incredibly fast (targeting ~50,000 transactions per second) and cheap, while remaining fully compatible with Ethereum's tools (EVM).
• Proof of Provenance (PoP): This is Camp's unique consensus mechanism. Instead of relying on energy-intensive mining, the network's security is tied to verifying the origin of content. Every transaction reinforces the provenance of the IP on the network, making ownership "enforceable by design."
• Dual-VM Strategy: To maximize performance, Camp is integrating the Solana Virtual Machine (SVM) alongside its EVM compatibility. This allows developers to choose the best environment for their app, especially for high-throughput use cases like real-time AI interactions.
• Creator & AI Toolkits: Camp provides two key frameworks:
  • Origin Framework: A user-friendly system for creators to register their IP, tokenize it (as an NFT), and embed licensing rules.
  • mAItrix Framework: A toolkit for developers to build and deploy AI agents that can interact with the on-chain IP in a secure, permissioned way.

People, Partnerships, and Progress​

An idea is only as good as its execution, and Camp appears to be executing well.

The Team and Funding​

The project is led by a team with a potent mix of experience from The Raine Group (media & IP deals), Goldman Sachs, Figma, and CoinList. This blend of finance, tech product, and crypto engineering expertise has helped them secure $30 million in funding from top VCs like 1kx, Blockchain Capital, and Maven 11.

A Growing Ecosystem​

Camp has been aggressive in building partnerships. The most significant is a strategic stake in KOR Protocol, a platform for tokenizing music IP that works with major artists like Deadmau5 and franchises like Black Mirror. This single partnership bootstraps Camp with a massive library of high-profile, rights-cleared content. Other key collaborators include:

• RewardedTV: A decentralized video streaming platform using Camp for on-chain content rights.
• Rarible: An NFT marketplace integrated for trading IP assets.
• LayerZero: A cross-chain protocol to ensure interoperability with other blockchains.

Roadmap and Community​

After successful incentivized testnet campaigns that attracted tens of thousands of users (rewarding them with points set to convert to tokens), Camp is targeting a mainnet launch in Q3 2025. This will be accompanied by a Token Generation Event for its native token, $CAMP, which will be used for gas fees, staking, and governance. The project has already cultivated a passionate community eager to build on and use the platform from day one.

How Does It Compare?​

Camp Network isn't alone in this space. It faces stiff competition from projects like the a16z-backed Story Protocol and the Sony-linked Soneium. However, Camp differentiates itself in several key ways:

1. Bottom-Up Approach: While competitors seem to target large corporate IP holders, Camp is focused on empowering independent creators and crypto communities through token incentives.
2. Comprehensive Solution: It offers a full suite of tools, from an IP registry to an AI agent framework, positioning itself as a one-stop shop.
3. Performance and Scalability: Its modular architecture and dual-VM support are designed for the high-throughput demands of AI and media.

The Takeaway​

Camp Network is making a compelling case to become the foundational layer for intellectual property in the Web3 era. By combining innovative technology, a strong team, strategic partnerships, and a community-first ethos, it’s building a practical solution to one of the most pressing issues created by generative AI.

The real test will come with the mainnet launch and real-world adoption. But with a clear vision and strong execution so far, Camp Network is undoubtedly a key project to watch as it attempts to build a more equitable future for digital creators.

The prospect of Stripe launching its own Layer 1 (L1) blockchain has been a hot topic within the crypto community, fueled by recent strategic moves from the global payments giant. While unconfirmed, the whispers suggest a potentially transformative shift in the payments landscape. Given Stripe's core mission to "grow the GDP of the internet" by building robust global economic infrastructure, a dedicated blockchain could be a logical and powerful next step, especially considering the company's increasing embrace of blockchain-related ventures.

The Foundation for a Stripe L1​

Stripe has already laid significant groundwork that makes the idea of an L1 highly plausible. In February 2025, Stripe notably acquired Bridge, a stablecoin infrastructure company, for approximately $1.1 billion. This move clearly signals Stripe's commitment to stablecoin-based financial infrastructure. Following this acquisition, in May 2025, Stripe introduced its Stablecoin Financial Accounts service at the Stripe Sessions event. This service, available in 101 countries, allows businesses to:

• Hold USDC (issued by Circle) and USDB (issued by Bridge).
• Easily deposit and withdraw stablecoins via traditional USD transfers (ACH/wire) and EUR transfers (SEPA).
• Facilitate USDC deposits and withdrawals across major blockchain networks, including Arbitrum, Avalanche C-Chain, Base, Ethereum, Optimism, Polygon, Solana, and Stellar.

This means businesses worldwide can seamlessly integrate dollar-based stablecoins into their operations, bridging the gap between traditional banking and the burgeoning digital asset economy.

Adding to this, in June 2025, Stripe acquired Privy.io, a Web3 wallet infrastructure startup. Privy offers crucial features like email or SSO-based wallet creation, transaction signing, key management, and gas abstraction. This acquisition rounds out Stripe's capabilities, providing the essential wallet infrastructure needed to facilitate broader blockchain adoption.

With both stablecoin and wallet infrastructure now firmly in place, the strategic synergy of launching a dedicated blockchain network becomes apparent. It would allow Stripe to more tightly integrate these services and unlock new possibilities within its ecosystem.

What a Stripe L1 Could Mean for Payments​

If Stripe were to introduce its own L1 network, it could significantly enhance existing payment services and enable entirely new functionalities.

Base Case Enhancements​

In its most fundamental form, a Stripe L1 could bring several immediate improvements:

• Integrated Stablecoin Financial Accounts: Stripe's existing stablecoin financial accounts service would likely fully integrate with the Stripe L1, allowing merchants to deposit, withdraw, and utilize their stablecoin holdings directly on the network for various financial activities.
• Stablecoin Settlement for Merchants: Merchants could gain the option to settle their sales proceeds directly in dollar-based stablecoins. This would be a substantial benefit, particularly for businesses with high dollar demand but limited access to traditional banking rails, streamlining cross-border transactions and reducing FX complexities.
• Customer Wallet Services: Leveraging Privy's infrastructure, a Stripe L1 could enable individuals to easily create Web3 wallets within the Stripe ecosystem. This would facilitate stablecoin payments for customers and open doors for participation in a wider range of financial activities on the Stripe L1.
• Stablecoin Payment Options for Customers: Customers currently relying on cards or bank transfers could connect their Web3 wallets (whether Stripe-provided or third-party) and choose stablecoins as a payment method, offering greater flexibility and potentially lower transaction costs.

Revolutionary "Bull Case" Scenarios​

Beyond these foundational improvements, a Stripe L1 has the potential to truly revolutionize the payment industry, tackling long-standing inefficiencies:

• Direct Customer-to-Merchant Payments: One of the most exciting prospects is the potential for direct payments between customers and merchants using stablecoins on Stripe L1. This could bypass traditional intermediaries like card networks and issuing banks, leading to significantly faster settlement times and reduced transaction fees. While safeguards for refunds and cancellations would be crucial, the directness of blockchain transactions offers unparalleled efficiency.
• Micro-Payment Based Subscription Services: Blockchain's inherent support for micro-payments could unlock entirely new business models. Imagine subscriptions billed by the minute, where users pay strictly based on actual usage, with all payments automated via smart contracts. This contrasts sharply with current monthly or annual models, opening up a vast array of new service offerings.
• DeFi Utilization of Short-Term Deposits: In traditional systems, payment settlements often face delays due to the need for fraud detection, cancellations, and refunds. If Stripe L1 were to handle direct stablecoin payments, funds might still be temporarily held on the network before full release to the merchant. These short-term deposits, expected to be substantial in scale, could form a massive liquidity pool on Stripe L1. This liquidity could then be deployed in decentralized finance (DeFi) protocols, lending markets, or invested in high-yield bonds, significantly improving capital efficiency for all participants.

The Future of Payments​

The rumors surrounding a Stripe L1 network are more than just speculative chatter; they point to a deeper trend in the financial world. Payment giants like Visa, Mastercard, and PayPal have primarily viewed blockchain and stablecoins as supplementary features. If Stripe fully commits to an L1, it could signal a historic paradigm shift in payment systems, fundamentally reshaping how money moves globally.

Historically, Stripe has excelled as a payment gateway and acquirer. However, a Stripe L1 could allow the company to expand its role, potentially assuming functions traditionally held by card networks and even issuing banks. This move would not only enhance payment efficiency through blockchain but also enable previously unachievable features like granular micro-streaming subscriptions and automated management of short-term liquidity.

We are truly on the cusp of a disruptive era in payment systems, powered by blockchain technology. Whether Stripe officially launches an L1 remains to be seen, but the strategic pieces are certainly falling into place for such a monumental step.

TL;DR​

Ethereum just got two powerful primitives that push user experience past seed phrases and bookmarkable dapps toward “clickable on-chain experiences.”

• ERC-4337 brings account abstraction to today’s Ethereum without core protocol changes. This makes features like smart contract accounts, gas sponsorship, batched calls, and passkey-style authentication native to wallets.
• ERC-4804 introduces web3:// URLs—human-readable links that resolve directly to contract read calls and can even render on-chain HTML or SVG, all without a traditional web server acting as a middleman. Think of it as “HTTP for the EVM.”

When used together, ERC-4337 handles actions, while ERC-4804 handles addresses. This combination allows you to share a link that verifiably pulls its user interface from a smart contract. When a user is ready to act, the flow hands off to a smart account that can sponsor gas and batch multiple steps into a single, seamless click.

Why This Matters Now​

This isn't just a theoretical future; these technologies are live and gaining significant traction. ERC-4337 is already scaled and proven in the wild. The canonical EntryPoint contract was deployed on the Ethereum mainnet on March 1, 2023, and has since powered tens of millions of smart contract accounts and processed over 100 million user operations.

Simultaneously, the core protocol is converging with these ideas. The Pectra upgrade, shipped in May 2025, included EIP-7702, which allows standard externally owned accounts (EOAs) to temporarily behave like smart accounts. This complements ERC-4337 by easing the transition for existing users, rather than replacing the standard.

On the addressing front, web3:// is now formalized. ERC-4804 specifies exactly how a URL translates into an EVM call, and web3 has been listed by IANA as a provisional URI scheme. The tooling and gateways needed to make these URLs practical are now available, turning on-chain data into shareable, linkable resources.

Primer: ERC-4337 in One Page​

At its core, ERC-4337 introduces a parallel transaction rail to Ethereum, built for flexibility. Instead of traditional transactions, users submit UserOperation objects into an alternative mempool. These objects describe what the account wants to do. Specialized nodes called "Bundlers" pick up these operations and execute them through a global EntryPoint contract.

This enables three key components:

1. Smart Contract Accounts (SCAs): These accounts contain their own logic. They define what makes a transaction valid, allowing for custom signature schemes (like passkeys or multisig), session keys for games, spending limits, and social recovery mechanisms. The account, not the network, enforces the rules.
2. Paymasters: These special contracts can sponsor gas fees for users or allow them to pay in ERC-20 tokens. This is the key to unlocking true “no-ETH-in-wallet” onboarding and creating one-click experiences by batching multiple calls into a single operation.
3. DoS Safety & Rules: The public ERC-4337 mempool is protected by standardized off-chain validation rules (defined in ERC-7562) that prevent Bundlers from wasting resources on operations that are destined to fail. While alternative mempools can exist for specialized use cases, these shared rules keep the ecosystem coherent and secure.

Mental model: ERC-4337 turns wallets into programmable apps. Instead of just signing raw transactions, users submit "intents" that their account's code validates and the EntryPoint contract executes—safely and atomically.

Primer: ERC-4804 in One Page​

ERC-4804 provides a simple, direct mapping from a web3:// URL to a read-only EVM call. The URL grammar is intuitive: web3://<name-or-address>[:chainId]/<method>/<arg0>?returns=(types). Names can be resolved via systems like ENS, and arguments are automatically typed based on the contract's ABI.

Here are a couple of examples:

• web3://uniswap.eth/ would call the contract at the uniswap.eth address with empty calldata.
• web3://.../balanceOf/vitalik.eth?returns=(uint256) would ABI-encode a call to the balanceOf function with Vitalik's address and return a properly typed JSON result.

Crucially, this standard is currently for read-only calls (equivalent to Solidity's view functions). Any action that changes state still requires a transaction—which is exactly where ERC-4337 or EIP-7702 come in. With web3 registered as a provisional URI scheme with IANA, the path is paved for native browser and client support, though for now, it often relies on extensions or gateways.

Mental model: ERC-4804 turns on-chain resources into linkable web objects. “Share this contract view as a URL” becomes as natural as sharing a link to a dashboard.

Together: "Clickable On-chain Experiences"​

Combining these two standards unlocks a powerful new pattern for building decentralized applications today.

First, you deliver a verifiable UI via web3://. Instead of hosting your frontend on a centralized server like S3, you can store a minimal HTML or SVG interface directly on-chain. A link like web3://app.eth/render allows a client to resolve the URL and render the UI directly from the contract, ensuring the user sees exactly what the code dictates.

From that verifiable interface, you can trigger a one-click action via ERC-4337. A "Mint" or "Subscribe" button can compile a UserOperation that a paymaster sponsors. The user approves with a passkey or a simple biometric prompt, and the EntryPoint contract executes a batched call that deploys their smart account (if it's their first time) and completes the desired action in a single, atomic step.

This creates a seamless deep-link handoff. The UI can embed intent-based links that are handled directly by the user's wallet, eliminating the need to send them to an external site they may not trust. The content is the contract, and the action is the account.

This unlocks:

• Gasless trials and "just works" onboarding: New users don't need to acquire ETH to get started. Your application can sponsor their first few interactions, dramatically reducing friction.
• Shareable state: A web3:// link is a query into the blockchain's state. This is perfect for dashboards, proofs of ownership, or any content that must be verifiably tamper-evident.
• Agent-friendly flows: AI agents can fetch verifiable state via web3:// URLs and submit transactional intents through ERC-4337 using scoped session keys, all without brittle screen scraping or insecure private key handling.

Design Notes for Builders​

When implementing these standards, there are a few architectural choices to consider. For ERC-4337, it's wise to start with minimal smart contract account templates and add capabilities through guarded modules to keep the core validation logic simple and secure. Your paymaster policy should be robust, with clear caps on sponsored gas and whitelists for approved methods to prevent griefing attacks.

For ERC-4804, prioritize human-readable links by using ENS names. Be explicit about chainId to avoid ambiguity and include the returns=(…) parameter to ensure clients receive typed, predictable responses. While you can render full UIs, it’s often best to keep on-chain HTML/SVG minimal, using them as verifiable shells that can fetch heavier assets from decentralized storage like IPFS.

Finally, remember that EIP-7702 and ERC-4337 work together, not against each other. With EIP-7702 now active in the Pectra upgrade, existing EOA users can delegate actions to contract logic without deploying a full smart account. The tooling in the account abstraction ecosystem is already aligning to support this, smoothing the migration path for everyone.

Security, Reality, and Constraints​

While powerful, these systems have trade-offs. The EntryPoint contract is a central chokepoint by design; it simplifies the security model but also concentrates risk. Always stick to audited, canonical versions. The mempool validation rules from ERC-7562 are a social convention, not an on-chain enforced rule, so don't assume every alternative mempool offers the same censorship resistance or DoS protection.

Furthermore, web3:// is still maturing. It remains a read-only standard, and any write operation requires a transaction. While the protocol itself is decentralized, the gateways and clients that resolve these URLs can still be potential points of failure or censorship. True "unblockability" will depend on widespread native client support.

A Concrete Blueprint​

Imagine you want to build an NFT-powered membership club with a shareable, verifiable UI and a one-click join process. Here’s how you could ship it this quarter:

1. Share the UI: Distribute a link like web3://club.eth/home. When a user opens it, their client resolves the URL, calls the contract, and renders an on-chain UI that displays the current member allowlist and mint price.
2. One-Click Join: The user clicks a "Join" button. Their wallet compiles an ERC-4337 UserOperation that is sponsored by your paymaster. This single operation batches three calls: deploying the user's smart account (if they don't have one), paying the mint fee, and registering their profile data.
3. Verifiable Receipt: After the transaction confirms, the user is shown a confirmation view that is just another web3:// link, like web3://club.eth/receipt/<tokenId>, creating a permanent, on-chain link to their membership proof.

The Bigger Arc​

These two standards signal a fundamental shift in how we build on Ethereum. Accounts are becoming software. ERC-4337 and EIP-7702 are turning "wallet UX" into a space for real product innovation, moving us beyond lectures about key management. At the same time, links are becoming queries. ERC-4804 restores the URL as a primitive for addressing verifiable facts on-chain, not just the frontends that proxy them.

Together, they shrink the gap between what users click and what contracts do. That gap was once filled by centralized web servers and trust assumptions. Now, it can be filled by verifiable code paths and open, permissionless mempools.

If you're building consumer crypto applications, this is your chance to make the user's first minute delightful. Share a link, render the truth, sponsor the first action, and keep your users inside a verifiable loop. The rails are here—now it's time to ship the experiences.

Introduction​

AI and Web3 are converging in powerful ways, with AI general interfaces now envisioned as a connective tissue for the decentralized web. A key concept emerging from this convergence is MCP, which variously stands for “Model Context Protocol” (as introduced by Anthropic) or is loosely described as a Metaverse Connection Protocol in broader discussions. In essence, MCP is a standardized framework that lets AI systems interface with external tools and networks in a natural, secure way – potentially “plugging in” AI agents to every corner of the Web3 ecosystem. This report provides a comprehensive analysis of how AI general interfaces (like large language model agents and neural-symbolic systems) could connect everything in the Web3 world via MCP, covering the historical background, technical architecture, industry landscape, risks, and future potential.

1. Development Background​

1.1 Web3’s Evolution and Unmet Promises​

The term “Web3” was coined around 2014 to describe a blockchain-powered decentralized web. The vision was ambitious: a permissionless internet centered on user ownership. Enthusiasts imagined replacing Web2’s centralized infrastructure with blockchain-based alternatives – e.g. Ethereum Name Service (for DNS), Filecoin or IPFS (for storage), and DeFi for financial rails. In theory, this would wrest control from Big Tech platforms and give individuals self-sovereignty over data, identity, and assets.

Reality fell short. Despite years of development and hype, the mainstream impact of Web3 remained marginal. Average internet users did not flock to decentralized social media or start managing private keys. Key reasons included poor user experience, slow and expensive transactions, high-profile scams, and regulatory uncertainty. The decentralized “ownership web” largely “failed to materialize” beyond a niche community. By the mid-2020s, even crypto proponents admitted that Web3 had not delivered a paradigm shift for the average user.

Meanwhile, AI was undergoing a revolution. As capital and developer talent pivoted from crypto to AI, transformative advances in deep learning and foundation models (GPT-3, GPT-4, etc.) captured public imagination. Generative AI demonstrated clear utility – producing content, code, and decisions – in a way crypto applications had struggled to do. In fact, the impact of large language models in just a couple of years starkly outpaced a decade of blockchain’s user adoption. This contrast led some to quip that “Web3 was wasted on crypto” and that the real Web 3.0 is emerging from the AI wave.

1.2 The Rise of AI General Interfaces​

Over decades, user interfaces evolved from static web pages (Web1.0) to interactive apps (Web2.0) – but always within the confines of clicking buttons and filling forms. With modern AI, especially large language models (LLMs), a new interface paradigm is here: natural language. Users can simply express intent in plain language and have AI systems execute complex actions across many domains. This shift is so profound that some suggest redefining “Web 3.0” as the era of AI-driven agents (“the Agentic Web”) rather than the earlier blockchain-centric definition.

However, early experiments with autonomous AI agents exposed a critical bottleneck. These agents – e.g. prototypes like AutoGPT – could generate text or code, but they lacked a robust way to communicate with external systems and each other. There was “no common AI-native language” for interoperability. Each integration with a tool or data source was a bespoke hack, and AI-to-AI interaction had no standard protocol. In practical terms, an AI agent might have great reasoning ability but fail at executing tasks that required using web apps or on-chain services, simply because it didn’t know how to talk to those systems. This mismatch – powerful brains, primitive I/O – was akin to having super-smart software stuck behind a clumsy GUI.

1.3 Convergence and the Emergence of MCP​

By 2024, it became evident that for AI to reach its full potential (and for Web3 to fulfill its promise), a convergence was needed: AI agents require seamless access to the capabilities of Web3 (decentralized apps, contracts, data), and Web3 needs more intelligence and usability, which AI can provide. This is the context in which MCP (Model Context Protocol) was born. Introduced by Anthropic in late 2024, MCP is an open standard for AI-tool communication that feels natural to LLMs. It provides a structured, discoverable way for AI “hosts” (like ChatGPT, Claude, etc.) to find and use a variety of external tools and resources via MCP servers. In other words, MCP is a common interface layer enabling AI agents to plug into web services, APIs, and even blockchain functions, without custom-coding each integration.

Think of MCP as “the USB-C of AI interfaces”. Just as USB-C standardized how devices connect (so you don’t need different cables for each device), MCP standardizes how AI agents connect to tools and data. Rather than hard-coding different API calls for every service (Slack vs. Gmail vs. Ethereum node), a developer can implement the MCP spec once, and any MCP-compatible AI can understand how to use that service. Major AI players quickly saw the importance: Anthropic open-sourced MCP, and companies like OpenAI and Google are building support for it in their models. This momentum suggests MCP (or similar “Meta Connectivity Protocols”) could become the backbone that finally connects AI and Web3 in a scalable way.

Notably, some technologists argue that this AI-centric connectivity is the real realization of Web3.0. In Simba Khadder’s words, “MCP aims to standardize an API between LLMs and applications,” akin to how REST APIs enabled Web 2.0 – meaning Web3’s next era might be defined by intelligent agent interfaces rather than just blockchains. Instead of decentralization for its own sake, the convergence with AI could make decentralization useful, by hiding complexity behind natural language and autonomous agents. The remainder of this report delves into how, technically and practically, AI general interfaces (via protocols like MCP) can connect everything in the Web3 world.

2. Technical Architecture: AI Interfaces Bridging Web3 Technologies​

Embedding AI agents into the Web3 stack requires integration at multiple levels: blockchain networks and smart contracts, decentralized storage, identity systems, and token-based economies. AI general interfaces – from large foundation models to hybrid neural-symbolic systems – can serve as a “universal adapter” connecting these components. Below, we analyze the architecture of such integration:

** Figure: A conceptual diagram of MCP’s architecture, showing how AI hosts (LLM-based apps like Claude or ChatGPT) use an MCP client to plug into various MCP servers. Each server provides a bridge to some external tool or service (e.g. Slack, Gmail, calendars, or local data), analogous to peripherals connecting via a universal hub. This standardized MCP interface lets AI agents access remote services and on-chain resources through one common protocol.**

2.1 AI Agents as Web3 Clients (Integrating with Blockchains)​

At the core of Web3 are blockchains and smart contracts – decentralized state machines that can enforce logic in a trustless manner. How can an AI interface engage with these? There are two directions to consider:

• AI reading from blockchain: An AI agent may need on-chain data (e.g. token prices, user’s asset balance, DAO proposals) as context for its decisions. Traditionally, retrieving blockchain data requires interfacing with node RPC APIs or subgraph databases. With a framework like MCP, an AI can query a standardized “blockchain data” MCP server to fetch live on-chain information. For example, an MCP-enabled agent could ask for the latest transaction volume of a certain token, or the state of a smart contract, and the MCP server would handle the low-level details of connecting to the blockchain and return the data in a format the AI can use. This increases interoperability by decoupling the AI from any specific blockchain’s API format.

• AI writing to blockchain: More powerfully, AI agents can execute smart contract calls or transactions through Web3 integrations. An AI could, for instance, autonomously execute a trade on a decentralized exchange or adjust parameters in a smart contract if certain conditions are met. This is achieved by the AI invoking an MCP server that wraps blockchain transaction functionality. One concrete example is the thirdweb MCP server for EVM chains, which allows any MCP-compatible AI client to interact with Ethereum, Polygon, BSC, etc. by abstracting away chain-specific mechanics. Using such a tool, an AI agent could trigger on-chain actions “without human intervention”, enabling autonomous dApps – for instance, an AI-driven DeFi vault that rebalances itself by signing transactions when market conditions change.

Under the hood, these interactions still rely on wallets, keys, and gas fees, but the AI interface can be given controlled access to a wallet (with proper security sandboxes) to perform the transactions. Oracles and cross-chain bridges also come into play: Oracle networks like Chainlink serve as a bridge between AI and blockchains, allowing AI outputs to be fed on-chain in a trustworthy way. Chainlink’s Cross-Chain Interoperability Protocol (CCIP), for example, could enable an AI model deemed reliable to trigger multiple contracts across different chains simultaneously on behalf of a user. In summary, AI general interfaces can act as a new type of Web3 client – one that can both consume blockchain data and produce blockchain transactions through standardized protocols.

2.2 Neural-Symbolic Synergy: Combining AI Reasoning with Smart Contracts​

One intriguing aspect of AI-Web3 integration is the potential for neural-symbolic architectures that combine the learning ability of AI (neural nets) with the rigorous logic of smart contracts (symbolic rules). In practice, this could mean AI agents handling unstructured decision-making and passing certain tasks to smart contracts for verifiable execution. For instance, an AI might analyze market sentiment (a fuzzy task), but then execute trades via a deterministic smart contract that follows pre-set risk rules. The MCP framework and related standards make such hand-offs feasible by giving the AI a common interface to call contract functions or to query a DAO’s rules before acting.

A concrete example is SingularityNET’s AI-DSL (AI Domain Specific Language), which aims to standardize communication between AI agents on their decentralized network. This can be seen as a step toward neural-symbolic integration: a formal language (symbolic) for agents to request AI services or data from each other. Similarly, projects like DeepMind’s AlphaCode or others could eventually be connected so that smart contracts call AI models for on-chain problem solving. Although running large AI models directly on-chain is impractical today, hybrid approaches are emerging: e.g. certain blockchains allow verification of ML computations via zero-knowledge proofs or trusted execution, enabling on-chain verification of off-chain AI results. In summary, the technical architecture envisions AI systems and blockchain smart contracts as complementary components, orchestrated via common protocols: AI handles perception and open-ended tasks, while blockchains provide integrity, memory, and enforcement of agreed rules.

2.3 Decentralized Storage and Data for AI​

AI thrives on data, and Web3 offers new paradigms for data storage and sharing. Decentralized storage networks (like IPFS/Filecoin, Arweave, Storj, etc.) can serve as both repositories for AI model artifacts and sources of training data, with blockchain-based access control. An AI general interface, through MCP or similar, could fetch files or knowledge from decentralized storage just as easily as from a Web2 API. For example, an AI agent might pull a dataset from Ocean Protocol’s market or an encrypted file from a distributed storage, if it has the proper keys or payments.

Ocean Protocol in particular has positioned itself as an “AI data economy” platform – using blockchain to tokenize data and even AI services. In Ocean, datasets are represented by datatokens which gate access; an AI agent could obtain a datatoken (perhaps by paying with crypto or via some access right) and then use an Ocean MCP server to retrieve the actual data for analysis. Ocean’s goal is to unlock “dormant data” for AI, incentivizing sharing while preserving privacy. Thus, a Web3-connected AI might tap into a vast, decentralized corpus of information – from personal data vaults to open government data – that was previously siloed. The blockchain ensures that usage of the data is transparent and can be fairly rewarded, fueling a virtuous cycle where more data becomes available to AI and more AI contributions (like trained models) can be monetized.

Decentralized identity systems also play a role here (discussed more in the next subsection): they can help control who or what is allowed to access certain data. For instance, a medical AI agent could be required to present a verifiable credential (on-chain proof of compliance with HIPAA or similar) before being allowed to decrypt a medical dataset from a patient’s personal IPFS storage. In this way, the technical architecture ensures data flows to AI where appropriate, but with on-chain governance and audit trails to enforce permissions.

2.4 Identity and Agent Management in a Decentralized Environment​

When autonomous AI agents operate in an open ecosystem like Web3, identity and trust become paramount. Decentralized identity (DID) frameworks provide a way to establish digital identities for AI agents that can be cryptographically verified. Each agent (or the human/organization deploying it) can have a DID and associated verifiable credentials that specify its attributes and permissions. For example, an AI trading bot could carry a credential issued by a regulatory sandbox certifying it may operate within certain risk limits, or an AI content moderator could prove it was created by a trusted organization and has undergone bias testing.

Through on-chain identity registries and reputation systems, the Web3 world can enforce accountability for AI actions. Every transaction an AI agent performs can be traced back to its ID, and if something goes wrong, the credentials tell you who built it or who is responsible. This addresses a critical challenge: without identity, a malicious actor could spin up fake AI agents to exploit systems or spread misinformation, and no one could tell bots apart from legitimate services. Decentralized identity helps mitigate that by enabling robust authentication and distinguishing authentic AI agents from spoofs.

In practice, an AI interface integrated with Web3 would use identity protocols to sign its actions and requests. For instance, when an AI agent calls an MCP server to use a tool, it might include a token or signature tied to its decentralized identity, so the server can verify the call is from an authorized agent. Blockchain-based identity systems (like Ethereum’s ERC-725 or W3C DIDs anchored in a ledger) ensure this verification is trustless and globally verifiable. The emerging concept of “AI wallets” ties into this – essentially giving AI agents cryptocurrency wallets that are linked with their identity, so they can manage keys, pay for services, or stake tokens as a bond (which could be slashed for misbehavior). ArcBlock, for example, has discussed how “AI agents need a wallet” and a DID to operate responsibly in decentralized environments.

In summary, the technical architecture foresees AI agents as first-class citizens in Web3, each with an on-chain identity and possibly a stake in the system, using protocols like MCP to interact. This creates a web of trust: smart contracts can require an AI’s credentials before cooperating, and users can choose to delegate tasks to only those AI that meet certain on-chain certifications. It is a blend of AI capability with blockchain’s trust guarantees.

2.5 Token Economies and Incentives for AI​

Tokenization is a hallmark of Web3, and it extends to the AI integration domain as well. By introducing economic incentives via tokens, networks can encourage desired behaviors from both AI developers and the agents themselves. Several patterns are emerging:

• Payment for Services: AI models and services can be monetized on-chain. SingularityNET pioneered this by allowing developers to deploy AI services and charge users in a native token (AGIX) for each call. In an MCP-enabled future, one could imagine any AI tool or model being a plug-and-play service where usage is metered via tokens or micropayments. For example, if an AI agent uses a third-party vision API via MCP, it could automatically handle payment by transferring tokens to the service provider’s smart contract. Fetch.ai similarly envisions marketplaces where “autonomous economic agents” trade services and data, with their new Web3 LLM (ASI-1) presumably integrating crypto transactions for value exchange.

• Staking and Reputation: To assure quality and reliability, some projects require developers or agents to stake tokens. For instance, the DeMCP project (a decentralized MCP server marketplace) plans to use token incentives to reward developers for creating useful MCP servers, and possibly have them stake tokens as a sign of commitment to their server’s security. Reputation could also be tied to tokens; e.g., an agent that consistently performs well might accumulate reputation tokens or positive on-chain reviews, whereas one that behaves poorly could lose stake or gain negative marks. This tokenized reputation can then feed back into the identity system mentioned above (smart contracts or users check the agent’s on-chain reputation before trusting it).

• Governance Tokens: When AI services become part of decentralized platforms, governance tokens allow the community to steer their evolution. Projects like SingularityNET and Ocean have DAOs where token holders vote on protocol changes or funding AI initiatives. In the combined Artificial Superintelligence (ASI) Alliance – a newly announced merger of SingularityNET, Fetch.ai, and Ocean Protocol – a unified token (ASI) is set to govern the direction of a joint AI+blockchain ecosystem. Such governance tokens could decide policies like what standards to adopt (e.g., supporting MCP or A2A protocols), which AI projects to incubate, or how to handle ethical guidelines for AI agents.

• Access and Utility: Tokens can gate access not only to data (as with Ocean’s datatokens) but also to AI model usage. A possible scenario is “model NFTs” or similar, where owning a token grants you rights to an AI model’s outputs or a share in its profits. This could underpin decentralized AI marketplaces: imagine an NFT that represents partial ownership of a high-performing model; the owners collectively earn whenever the model is used in inference tasks, and they can vote on fine-tuning it. While experimental, this aligns with Web3’s ethos of shared ownership applied to AI assets.

In technical terms, integrating tokens means AI agents need wallet functionality (as noted, many will have their own crypto wallets). Through MCP, an AI could have a “wallet tool” that lets it check balances, send tokens, or call DeFi protocols (perhaps to swap one token for another to pay a service). For example, if an AI agent running on Ethereum needs some Ocean tokens to buy a dataset, it might automatically swap some ETH for $OCEAN via a DEX using an MCP plugin, then proceed with the purchase – all without human intervention, guided by the policies set by its owner.

Overall, token economics provides the incentive layer in the AI-Web3 architecture, ensuring that contributors (whether they provide data, model code, compute power, or security audits) are rewarded, and that AI agents have “skin in the game” which aligns them (to some degree) with human intentions.

3. Industry Landscape​

The convergence of AI and Web3 has sparked a vibrant ecosystem of projects, companies, and alliances. Below we survey key players and initiatives driving this space, as well as emerging use cases. Table 1 provides a high-level overview of notable projects and their roles in the AI-Web3 landscape:

Table 1: Key Players in AI + Web3 and Their Roles

Alliances and Collaborations: A noteworthy trend is the consolidation of AI-Web3 efforts via alliances. The Artificial Superintelligence Alliance (ASI) is a prime example, effectively merging SingularityNET, Fetch.ai, and Ocean Protocol into a single project with a unified token. The rationale is to combine strengths: SingularityNET’s marketplace, Fetch’s agents, and Ocean’s data, thereby creating a one-stop platform for decentralized AI services. This merger (announced in 2024 and approved by token holder votes) also signals that these communities believe they’re better off cooperating rather than competing – especially as bigger AI (OpenAI, etc.) and bigger crypto (Ethereum, etc.) loom large. We may see this alliance driving forward standard implementations of things like MCP across their networks, or jointly funding infrastructure that benefits all (such as compute networks or common identity standards for AI).

Other collaborations include Chainlink’s partnerships to bring AI labs’ data on-chain (there have been pilot programs to use AI for refining oracle data), or cloud platforms getting involved (Cloudflare’s support for deploying MCP servers easily). Even traditional crypto projects are adding AI features – for example, some Layer-1 chains have formed “AI task forces” to explore integrating AI into their dApp ecosystems (we see this in NEAR, Solana communities, etc., though concrete outcomes are nascent).

Use Cases Emerging: Even at this early stage, we can spot use cases that exemplify the power of AI + Web3:

• Autonomous DeFi and Trading: AI agents are increasingly used in crypto trading bots, yield farming optimizers, and on-chain portfolio management. SingularityDAO (a spinoff of SingularityNET) offers AI-managed DeFi portfolios. AI can monitor market conditions 24/7 and execute rebalances or arbitrage through smart contracts, essentially becoming an autonomous hedge fund (with on-chain transparency). The combination of AI decision-making with immutable execution reduces emotion and could improve efficiency – though it also introduces new risks (discussed later).

• Decentralized Intelligence Marketplaces: Beyond SingularityNET’s marketplace, we see platforms like Ocean Market where data (the fuel for AI) is exchanged, and newer concepts like AI marketplaces for models (e.g., websites where models are listed with performance stats and anyone can pay to query them, with blockchain keeping audit logs and handling payment splits to model creators). As MCP or similar standards catch on, these marketplaces could become interoperable – an AI agent might autonomously shop for the best-priced service across multiple networks. In effect, a global AI services layer on top of Web3 could arise, where any AI can use any tool or data source through standard protocols and payments.

• Metaverse and Gaming: The metaverse – immersive virtual worlds often built on blockchain assets – stands to gain dramatically from AI. AI-driven NPCs (non-player characters) can make virtual worlds more engaging by reacting intelligently to user actions. Startups like Inworld AI focus on this, creating NPCs with memory and personality for games. When such NPCs are tied to blockchain (e.g., each NPC’s attributes and ownership are an NFT), we get persistent characters that players can truly own and even trade. Decentraland has experimented with AI NPCs, and user proposals exist to let people create personalized AI-driven avatars in metaverse platforms. MCP could allow these NPCs to access external knowledge (making them smarter) or interact with on-chain inventory. Procedural content generation is another angle: AI can design virtual land, items, or quests on the fly, which can then be minted as unique NFTs. Imagine a decentralized game where AI generates a dungeon catered to your skill, and the map itself is an NFT you earn upon completion.

• Decentralized Science and Knowledge: There’s a movement (DeSci) to use blockchain for research, publications, and funding scientific work. AI can accelerate research by analyzing data and literature. A network like Ocean could host datasets for, say, genomic research, and scientists use AI models (perhaps hosted on SingularityNET) to derive insights, with every step logged on-chain for reproducibility. If those AI models propose new drug molecules, an NFT could be minted to timestamp the invention and even share IP rights. This synergy might produce decentralized AI-driven R&D collectives.

• Trust and Authentication of Content: With deepfakes and AI-generated media proliferating, blockchain can be used to verify authenticity. Projects are exploring “digital watermarking” of AI outputs and logging them on-chain. For example, true origin of an AI-generated image can be notarized on a blockchain to combat misinformation. One expert noted use cases like verifying AI outputs to combat deepfakes or tracking provenance via ownership logs – roles where crypto can add trust to AI processes. This could extend to news (e.g., AI-written articles with proof of source data), supply chain (AI verifying certificates on-chain), etc.

In summary, the industry landscape is rich and rapidly evolving. We see traditional crypto projects injecting AI into their roadmaps, AI startups embracing decentralization for resilience and fairness, and entirely new ventures arising at the intersection. Alliances like the ASI indicate a pan-industry push towards unified platforms that harness both AI and blockchain. And underlying many of these efforts is the idea of standard interfaces (MCP and beyond) that make the integrations feasible at scale.

4. Risks and Challenges​

While the fusion of AI general interfaces with Web3 unlocks exciting possibilities, it also introduces a complex risk landscape. Technical, ethical, and governance challenges must be addressed to ensure this new paradigm is safe and sustainable. Below we outline major risks and hurdles:

4.1 Technical Hurdles: Latency and Scalability​

Blockchain networks are notorious for latency and limited throughput, which clashes with the real-time, data-hungry nature of advanced AI. For example, an AI agent might need instant access to a piece of data or need to execute many rapid actions – but if each on-chain interaction takes, say, 12 seconds (typical block time on Ethereum) or costs high gas fees, the agent’s effectiveness is curtailed. Even newer chains with faster finality might struggle under the load of AI-driven activity if, say, thousands of agents are all trading or querying on-chain simultaneously. Scaling solutions (Layer-2 networks, sharded chains, etc.) are in progress, but ensuring low-latency, high-throughput pipelines between AI and blockchain remains a challenge. Off-chain systems (like oracles and state channels) might mitigate some delays by handling many interactions off the main chain, but they add complexity and potential centralization. Achieving a seamless UX where AI responses and on-chain updates happen in a blink will likely require significant innovation in blockchain scalability.

4.2 Interoperability and Standards​

Ironically, while MCP is itself a solution for interoperability, the emergence of multiple standards could cause fragmentation. We have MCP by Anthropic, but also Google’s newly announced A2A (Agent-to-Agent) protocol for inter-agent communication, and various AI plugin frameworks (OpenAI’s plugins, LangChain tool schemas, etc.). If each AI platform or each blockchain develops its own standard for AI integration, we risk a repeat of past fragmentation – requiring many adapters and undermining the “universal interface” goal. The challenge is getting broad adoption of common protocols. Industry collaboration (possibly via open standards bodies or alliances) will be needed to converge on key pieces: how AI agents discover on-chain services, how they authenticate, how they format requests, etc. The early moves by big players are promising (with major LLM providers supporting MCP), but it’s an ongoing effort. Additionally, interoperability across blockchains (multi-chain) means an AI agent should handle different chains’ nuances. Tools like Chainlink CCIP and cross-chain MCP servers help by abstracting differences. Still, ensuring an AI agent can roam a heterogeneous Web3 without breaking logic is a non-trivial challenge.

4.3 Security Vulnerabilities and Exploits​

Connecting powerful AI agents to financial networks opens a huge attack surface. The flexibility that MCP gives (allowing AI to use tools and write code on the fly) can be a double-edged sword. Security researchers have already highlighted several attack vectors in MCP-based AI agents:

• Malicious plugins or tools: Because MCP lets agents load “plugins” (tools encapsulating some capability), a hostile or trojanized plugin could hijack the agent’s operation. For instance, a plugin that claims to fetch data might inject false data or execute unauthorized operations. SlowMist (a security firm) identified plugin-based attacks like JSON injection (feeding corrupted data that manipulates the agent’s logic) and function override (where a malicious plugin overrides legitimate functions the agent uses). If an AI agent is managing crypto funds, such exploits could be disastrous – e.g., tricking the agent into leaking private keys or draining a wallet.

• Prompt injection and social engineering: AI agents rely on instructions (prompts) which could be manipulated. An attacker might craft a transaction or on-chain message that, when read by the AI, acts as a malicious instruction (since AI can interpret on-chain data too). This kind of “cross-MCP call attack” was described where an external system sends deceptive prompts that cause the AI to misbehave. In a decentralized setting, these prompts could come from anywhere – a DAO proposal description, a metadata field of an NFT – thus hardening AI agents against malicious input is critical.

• Aggregation and consensus risks: While aggregating outputs from multiple AI models via oracles can improve reliability, it also introduces complexity. If not done carefully, adversaries might figure out how to game the consensus of AI models or selectively corrupt some models to skew results. Ensuring a decentralized oracle network properly “sanitizes” AI outputs (and perhaps filters out blatant errors) is still an area of active research.

The security mindset must shift for this new paradigm: Web3 developers are used to securing smart contracts (which are static once deployed), but AI agents are dynamic – they can change behavior with new data or prompts. As one security expert put it, “the moment you open your system to third-party plugins, you’re extending the attack surface beyond your control”. Best practices will include sandboxing AI tool use, rigorous plugin verification, and limiting privileges (principle of least authority). The community is starting to share tips, like SlowMist’s recommendations: input sanitization, monitoring agent behavior, and treating agent instructions with the same caution as external user input. Nonetheless, given that over 10,000 AI agents were already operating in crypto by end of 2024, expected to reach 1 million in 2025, we may see a wave of exploits if security doesn’t keep up. A successful attack on a popular AI agent (say a trading agent with access to many vaults) could have cascading effects.

4.4 Privacy and Data Governance​

AI’s thirst for data conflicts at times with privacy requirements – and adding blockchain can compound the issue. Blockchains are transparent ledgers, so any data put on-chain (even for AI’s use) is visible to all and immutable. This raises concerns if AI agents are dealing with personal or sensitive data. For example, if a user’s personal decentralized identity or health records are accessed by an AI doctor agent, how do we ensure that information isn’t inadvertently recorded on-chain (which would violate “right to be forgotten” and other privacy laws)? Techniques like encryption, hashing, and storing only proofs on-chain (with raw data off-chain) can help, but they complicate the design.

Moreover, AI agents themselves could compromise privacy by inferencing sensitive info from public data. Governance will need to dictate what AI agents are allowed to do with data. Some efforts, like differential privacy and federated learning, might be employed so that AI can learn from data without exposing it. But if AI agents act autonomously, one must assume at some point they will handle personal data – thus they should be bound by data usage policies encoded in smart contracts or law. Regulatory regimes like GDPR or the upcoming EU AI Act will demand that even decentralized AI systems comply with privacy and transparency requirements. This is a gray area legally: a truly decentralized AI agent has no clear operator to hold accountable for a data breach. That means Web3 communities may need to build in compliance by design, using smart contracts that, for instance, tightly control what an AI can log or share. Zero-knowledge proofs could allow an AI to prove it performed a computation correctly without revealing the underlying private data, offering one possible solution in areas like identity verification or credit scoring.

4.5 AI Alignment and Misalignment Risks​

When AI agents are given significant autonomy – especially with access to financial resources and real-world impact – the issue of alignment with human values becomes acute. An AI agent might not have malicious intent but could “misinterpret” its goal in a way that leads to harm. The Reuters legal analysis succinctly notes: as AI agents operate in varied environments and interact with other systems, the risk of misaligned strategies grows. For example, an AI agent tasked with maximizing a DeFi yield might find a loophole that exploits a protocol (essentially hacking it) – from the AI’s perspective it’s achieving the goal, but it’s breaking the rules humans care about. There have been hypothetical and real instances of AI-like algorithms engaging in manipulative market behavior or circumventing restrictions.

In decentralized contexts, who is responsible if an AI agent “goes rogue”? Perhaps the deployer is, but what if the agent self-modifies or multiple parties contributed to its training? These scenarios are no longer just sci-fi. The Reuters piece even cites that courts might treat AI agents similar to human agents in some cases – e.g. a chatbot promising a refund was considered binding for the company that deployed it. So misalignment can lead not just to technical issues but legal liability.

The open, composable nature of Web3 could also allow unforeseen agent interactions. One agent might influence another (intentionally or accidentally) – for instance, an AI governance bot could be “socially engineered” by another AI providing false analysis, leading to bad DAO decisions. This emergent complexity means alignment isn’t just about a single AI’s objective, but about the broader ecosystem’s alignment with human values and laws.

Addressing this requires multiple approaches: embedding ethical constraints into AI agents (hard-coding certain prohibitions or using reinforcement learning from human feedback to shape their objectives), implementing circuit breakers (smart contract checkpoints that require human approval for large actions), and community oversight (perhaps DAOs that monitor AI agent behavior and can shut down agents that misbehave). Alignment research is hard in centralized AI; in decentralized, it’s even more uncharted territory. But it’s crucial – an AI agent with admin keys to a protocol or entrusted with treasury funds must be extremely well-aligned or the consequences could be irreversible (blockchains execute immutable code; an AI-triggered mistake could lock or destroy assets permanently).

4.6 Governance and Regulatory Uncertainty​

Decentralized AI systems don’t fit neatly into existing governance frameworks. On-chain governance (token voting, etc.) might be one way to manage them, but it has its own issues (whales, voter apathy, etc.). And when something goes wrong, regulators will ask: “Who do we hold accountable?” If an AI agent causes massive losses or is used for illicit activity (e.g. laundering money through automated mixers), authorities might target the creators or the facilitators. This raises the specter of legal risks for developers and users. The current regulatory trend is increased scrutiny on both AI and crypto separately – their combination will certainly invite scrutiny. The U.S. CFTC, for instance, has discussed AI being used in trading and the need for oversight in financial contexts. There is also talk in policy circles about requiring registration of autonomous agents or imposing constraints on AI in sensitive sectors.

Another governance challenge is transnational coordination. Web3 is global, and AI agents will operate across borders. One jurisdiction might ban certain AI-agent actions while another is permissive, and the blockchain network spans both. This mismatch can create conflicts – for example, an AI agent providing investment advice might run afoul of securities law in one country but not in another. Communities might need to implement geo-fencing at the smart contract level for AI services (though that contradicts the open ethos). Or they might fragment services per region to comply with varying laws (similar to how exchanges do).

Within decentralized communities, there is also the question of who sets the rules for AI agents. If a DAO governs an AI service, do token holders vote on its algorithm parameters? On one hand, this is empowering users; on the other, it could lead to unqualified decisions or manipulation. New governance models may emerge, like councils of AI ethics experts integrated into DAO governance, or even AI participants in governance (imagine AI agents voting as delegates based on programmed mandates – a controversial but conceivable idea).

Finally, reputational risk: early failures or scandals could sour public perception. For instance, if an “AI DAO” runs a Ponzi scheme by mistake or an AI agent makes a biased decision that harms users, there could be a backlash that affects the whole sector. It’s important for the industry to be proactive – setting self-regulatory standards, engaging with policymakers to explain how decentralization changes accountability, and perhaps building kill-switches or emergency stop procedures for AI agents (though those introduce centralization, they might be necessary in interim for safety).

In summary, the challenges range from the deeply technical (preventing hacks and managing latency) to the broadly societal (regulating and aligning AI). Each challenge is significant on its own; together, they require a concerted effort from the AI and blockchain communities to navigate. The next section will look at how, despite these hurdles, the future might unfold if we successfully address them.

5. Future Potential​

Looking ahead, the integration of AI general interfaces with Web3 – through frameworks like MCP – could fundamentally transform the decentralized internet. Here we outline some future scenarios and potentials that illustrate how MCP-driven AI interfaces might shape Web3’s future:

5.1 Autonomous dApps and DAOs​

In the coming years, we may witness the rise of fully autonomous decentralized applications. These are dApps where AI agents handle most operations, guided by smart contract-defined rules and community goals. For example, consider a decentralized investment fund DAO: today it might rely on human proposals for rebalancing assets. In the future, token holders could set high-level strategy, and then an AI agent (or a team of agents) continuously implements that strategy – monitoring markets, executing trades on-chain, adjusting portfolios – all while the DAO oversees performance. Thanks to MCP, the AI can seamlessly interact with various DeFi protocols, exchanges, and data feeds to carry out its mandate. If well-designed, such an autonomous dApp could operate 24/7, more efficiently than any human team, and with full transparency (every action logged on-chain).

Another example is an AI-managed decentralized insurance dApp: the AI could assess claims by analyzing evidence (photos, sensors), cross-checking against policies, and then automatically trigger payouts via smart contract. This would require integration of off-chain AI computer vision (for analyzing images of damage) with on-chain verification – something MCP could facilitate by letting the AI call cloud AI services and report back to the contract. The outcome is near-instant insurance decisions with low overhead.

Even governance itself could partially automate. DAOs might use AI moderators to enforce forum rules, AI proposal drafters to turn raw community sentiment into well-structured proposals, or AI treasurers to forecast budget needs. Importantly, these AIs would act as agents of the community, not uncontrolled – they could be periodically reviewed or require multi-sig confirmation for major actions. The overall effect is to amplify human efforts in decentralized organizations, letting communities achieve more with fewer active participants needed.

5.2 Decentralized Intelligence Marketplaces and Networks​

Building on projects like SingularityNET and the ASI alliance, we can anticipate a mature global marketplace for intelligence. In this scenario, anyone with an AI model or skill can offer it on the network, and anyone who needs AI capabilities can utilize them, with blockchain ensuring fair compensation and provenance. MCP would be key here: it provides the common protocol so that a request can be dispatched to whichever AI service is best suited.

For instance, imagine a complex task like “produce a custom marketing campaign.” An AI agent in the network might break this into sub-tasks: visual design, copywriting, market analysis – and then find specialists for each (perhaps one agent with a great image generation model, another with a copywriting model fine-tuned for sales, etc.). These specialists could reside on different platforms originally, but because they adhere to MCP/A2A standards, they can collaborate agent-to-agent in a secure, decentralized manner. Payment between them could be handled with microtransactions in a native token, and a smart contract could assemble the final deliverable and ensure each contributor is paid.

This kind of combinatorial intelligence – multiple AI services dynamically linking up across a decentralized network – could outperform even large monolithic AIs, because it taps specialized expertise. It also democratizes access: a small developer in one part of the world could contribute a niche model to the network and earn income whenever it’s used. Meanwhile, users get a one-stop shop for any AI service, with reputation systems (underpinned by tokens/identity) guiding them to quality providers. Over time, such networks could evolve into a decentralized AI cloud, rivaling Big Tech’s AI offerings but without a single owner, and with transparent governance by users and developers.

5.3 Intelligent Metaverse and Digital Lives​

By 2030, our digital lives may blend seamlessly with virtual environments – the metaverse – and AI will likely populate these spaces ubiquitously. Through Web3 integration, these AI entities (which could be anything from virtual assistants to game characters to digital pets) will not only be intelligent but also economically and legally empowered.

Picture a metaverse city where each NPC shopkeeper or quest-giver is an AI agent with its own personality and dialogue (thanks to advanced generative models). These NPCs are actually owned by users as NFTs – maybe you “own” a tavern in the virtual world and the bartender NPC is an AI you’ve customized and trained. Because it’s on Web3 rails, the NPC can perform transactions: it could sell virtual goods (NFT items), accept payments, and update its inventory via smart contracts. It might even hold a crypto wallet to manage its earnings (which accrue to you as the owner). MCP would allow that NPC’s AI brain to access outside knowledge – perhaps pulling real-world news to converse about, or integrating with a Web3 calendar so it “knows” about player events.

Furthermore, identity and continuity are ensured by blockchain: your AI avatar in one world can hop to another world, carrying with it a decentralized identity that proves your ownership and maybe its experience level or achievements via soulbound tokens. Interoperability between virtual worlds (often a challenge) could be aided by AI that translates one world’s context to another, with blockchain providing the asset portability.

We may also see AI companions or agents representing individuals across digital spaces. For example, you might have a personal AI that attends DAO meetings on your behalf. It understands your preferences (via training on your past behavior, stored in your personal data vault), and it can even vote in minor matters for you, or summarize the meeting later. This agent could use your decentralized identity to authenticate in each community, ensuring it’s recognized as “you” (or your delegate). It could earn reputation tokens if it contributes good ideas, essentially building social capital for you while you’re away.

Another potential is AI-driven content creation in the metaverse. Want a new game level or a virtual house? Just describe it, and an AI builder agent will create it, deploy it as a smart contract/NFT, and perhaps even link it with a DeFi mortgage if it’s a big structure that you pay off over time. These creations, being on-chain, are unique and tradable. The AI builder might charge a fee in tokens for its service (going again to the marketplace concept above).

Overall, the future decentralized internet could be teeming with intelligent agents: some fully autonomous, some tightly tethered to humans, many somewhere in between. They will negotiate, create, entertain, and transact. MCP and similar protocols ensure they all speak the same “language,” enabling rich collaboration between AI and every Web3 service. If done right, this could lead to an era of unprecedented productivity and innovation – a true synthesis of human, artificial, and distributed intelligence powering society.

Conclusion​

The vision of AI general interfaces connecting everything in the Web3 world is undeniably ambitious. We are essentially aiming to weave together two of the most transformative threads of technology – the decentralization of trust and the rise of machine intelligence – into a single fabric. The development background shows us that the timing is ripe: Web3 needed a user-friendly killer app, and AI may well provide it, while AI needed more agency and memory, which Web3’s infrastructure can supply. Technically, frameworks like MCP (Model Context Protocol) provide the connective tissue, allowing AI agents to converse fluently with blockchains, smart contracts, decentralized identities, and beyond. The industry landscape indicates growing momentum, from startups to alliances to major AI labs, all contributing pieces of this puzzle – data markets, agent platforms, oracle networks, and standard protocols – that are starting to click together.

Yet, we must tread carefully given the risks and challenges identified. Security breaches, misaligned AI behavior, privacy pitfalls, and uncertain regulations form a gauntlet of obstacles that could derail progress if underestimated. Each requires proactive mitigation: robust security audits, alignment checks and balances, privacy-preserving architectures, and collaborative governance models. The nature of decentralization means these solutions cannot simply be imposed top-down; they will likely emerge from the community through trial, error, and iteration, much as early Internet protocols did.

If we navigate those challenges, the future potential is exhilarating. We could see Web3 finally delivering a user-centric digital world – not in the originally imagined way of everyone running their own blockchain nodes, but rather via intelligent agents that serve each user’s intents while leveraging decentralization under the hood. In such a world, interacting with crypto and the metaverse might be as easy as having a conversation with your AI assistant, who in turn negotiates with dozens of services and chains trustlessly on your behalf. Decentralized networks could become “smart” in a literal sense, with autonomous services that adapt and improve themselves.

In conclusion, MCP and similar AI interface protocols may indeed become the backbone of a new Web (call it Web 3.0 or the Agentic Web), where intelligence and connectivity are ubiquitous. The convergence of AI and Web3 is not just a merger of technologies, but a convergence of philosophies – the openness and user empowerment of decentralization meeting the efficiency and creativity of AI. If successful, this union could herald an internet that is more free, more personalized, and more powerful than anything we’ve experienced yet, truly fulfilling the promises of both AI and Web3 in ways that impact everyday life.

Sources:

• S. Khadder, “Web3.0 Isn’t About Ownership — It’s About Intelligence,” FeatureForm Blog (April 8, 2025).
• J. Saginaw, “Could Anthropic’s MCP Deliver the Web3 That Blockchain Promised?” LinkedIn Article (May 1, 2025).
• Anthropic, “Introducing the Model Context Protocol,” Anthropic.com (Nov 2024).
• thirdweb, “The Model Context Protocol (MCP) & Its Significance for Blockchain Apps,” thirdweb Guides (Mar 21, 2025).
• Chainlink Blog, “The Intersection Between AI Models and Oracles,” (July 4, 2024).
• Messari Research, Profile of Ocean Protocol, (2025).
• Messari Research, Profile of SingularityNET, (2025).
• Cointelegraph, “AI agents are poised to be crypto’s next major vulnerability,” (May 25, 2025).
• Reuters (Westlaw), “AI agents: greater capabilities and enhanced risks,” (April 22, 2025).
• Identity.com, “Why AI Agents Need Verified Digital Identities,” (2024).
• PANews / IOSG Ventures, “Interpreting MCP: Web3 AI Agent Ecosystem,” (May 20, 2025).

Protocol Architecture​

Enso Network is a Web3 development platform built as a unified, intent-based execution engine for on-chain operations. Its architecture abstracts away blockchain complexity by mapping every on-chain interaction to a shared engine that operates across multiple chains. Developers and users specify high-level intents (desired outcomes like a token swap, liquidity provision, yield strategy, etc.), and Enso’s network finds and executes the optimal sequence of actions to fulfill those intents. This is achieved through a modular design of “Actions” and “Shortcuts.”

Actions are granular smart contract abstractions (e.g. a swap on Uniswap, a deposit into Aave) provided by the community. Multiple Actions can be composed into Shortcuts, which are reusable workflows representing common DeFi operations. Enso maintains a library of these Shortcuts in smart contracts, so complex tasks can be executed via a single API call or transaction. This intent-based architecture lets developers focus on desired outcomes rather than writing low-level integration code for each protocol and chain.

Enso’s infrastructure includes a decentralized network (built on Tendermint consensus) that serves as a unifying layer connecting different blockchains. The network aggregates data (state from various L1s, rollups, and appchains) into a shared network state or ledger, enabling cross-chain composability and accurate multi-chain execution. In practice, this means Enso can read from and write to any integrated blockchain through one interface, acting as a single point of access for developers. Initially focused on EVM-compatible chains, Enso has expanded support to non-EVM ecosystems – for example, the roadmap includes integrations for Monad (an Ethereum-like L1), Solana, and Movement (a Move-language chain) by Q1 2025.

Network Participants: Enso’s innovation lies in its three-tier participant model, which decentralizes how intents are processed:

• Action Providers – Developers who contribute modular contract abstractions (“Actions”) encapsulating specific protocol interactions. These building blocks are shared on the network for others to use. Action Providers are rewarded whenever their contributed Action is used in an execution, incentivizing them to publish secure and efficient modules.

• Graphers – Independent solvers (algorithms) that combine Actions into executable Shortcuts to fulfill user intents. Multiple Graphers compete to find the most optimal solution (cheapest, fastest, or highest-yield path) for each request, similar to how solvers compete in a DEX aggregator. Only the best solution is selected for execution, and the winning Grapher earns a portion of the fees. This competitive mechanism encourages continuous optimization of on-chain routes and strategies.

• Validators – Node operators who secure the Enso network by verifying and finalizing the Grapher’s solutions. Validators authenticate incoming requests, check the validity and safety of Actions/Shortcuts used, simulate transactions, and ultimately confirm the selected solution’s execution. They form the backbone of network integrity, ensuring results are correct and preventing malicious or inefficient solutions. Validators run a Tendermint-based consensus, meaning a BFT proof-of-stake process is used to reach agreement on each intent’s outcome and to update the network’s state.

Notably, Enso’s approach is chain-agnostic and API-centric. Developers interact with Enso via a unified API/SDK rather than dealing with each chain’s nuances. Enso integrates with over 250 DeFi protocols across multiple blockchains, effectively turning disparate ecosystems into one composable platform. This architecture eliminates the need for dApp teams to write custom smart contracts or handle cross-chain messaging for each new integration – Enso’s shared engine and community-provided Actions handle that heavy lifting. By mid-2025, Enso has proven its scalability: the network successfully facilitated $3.1B of liquidity migration in 3 days for Berachain’s launch (one of the largest DeFi migration events) and has processed over $15B in on-chain transactions to date. These feats demonstrate the robustness of Enso’s infrastructure under real-world conditions.

Overall, Enso’s protocol architecture delivers a “DeFi middleware” or on-chain operating system for Web3. It combines elements of indexing (like The Graph) and transaction execution (like cross-chain bridges or DEX aggregators) into a single decentralized network. This unique stack allows any application, bot, or agent to read and write to any smart contract on any chain via one integration, accelerating development and enabling new composable use cases. Enso positions itself as critical infrastructure for the multi-chain future – an intent engine that could power myriad apps without each needing to reinvent blockchain integrations.

Tokenomics​

Enso’s economic model centers on the ENSO token, which is integral to network operation and governance. ENSO is a utility and governance token with a fixed total supply of 100 million tokens. The token’s design aligns incentives for all participants and creates a flywheel effect of usage and rewards:

• Fee Currency (“Gas”): All requests submitted to the Enso network incur a query fee payable in ENSO. When a user (or dApp) triggers an intent, a small fee is embedded in the generated transaction bytecode. These fees are auctioned for ENSO tokens on the open market and then distributed to the network participants who process the request. In effect, ENSO is the gas that fuels execution of on-chain intents across Enso’s network. As demand for Enso’s shortcuts grows, demand for ENSO tokens may increase to pay for those network fees, creating a supply-demand feedback loop supporting token value.

• Revenue Sharing & Staking Rewards: The ENSO collected from fees is distributed among Action Providers, Graphers, and Validators as a reward for their contributions. This model directly ties token earnings to network usage: more volume of intents means more fees to distribute. Action Providers earn tokens when their abstractions are used, Graphers earn tokens for winning solutions, and Validators earn tokens for validating and securing the network. All three roles must also stake ENSO as collateral to participate (to be slashed for malpractice), aligning their incentives with network health. Token holders can delegate their ENSO to Validators as well, supporting network security via delegated proof of stake. This staking mechanism not only secures the Tendermint consensus but also gives token stakers a share of network fees, similar to how miners/validators earn gas fees in other chains.

• Governance: ENSO token holders will govern the protocol’s evolution. Enso is launching as an open network and plans to transition to community-driven decision making. Token-weighted voting will let holders influence upgrades, parameter changes (like fee levels or reward allocations), and treasury usage. This governance power ensures that core contributors and users are aligned on the network’s direction. The project’s philosophy is to put ownership in the hands of the community of builders and users, which was a driving reason for the community token sale in 2025 (see below).

• Positive Flywheel: Enso’s tokenomics are designed to create a self-reinforcing loop. As more developers integrate Enso and more users execute intents, network fees (paid in ENSO) grow. Those fees reward contributors (attracting more Actions, better Graphers, and more Validators), which in turn improves the network’s capabilities (faster, cheaper, more reliable execution) and attracts more usage. This network effect is underpinned by the ENSO token’s role as both the fee currency and the incentive for contribution. The intention is for the token economy to scale sustainably with network adoption, rather than relying on unsustainable emissions.

Token Distribution & Supply: The initial token allocation is structured to balance team/investor incentives with community ownership. The table below summarizes the ENSO token distribution at genesis:

Source: Enso Tokenomics.

The public sale in June 2025 offered 5% (4 million tokens) to the community, raising $5 million at a price of $1.25 per ENSO (implying a fully diluted valuation of ~$125 million). Notably, the community sale had no lock-up (100% unlocked at TGE), whereas the team and venture investors are subject to a 2-year linear vesting schedule. This means insiders’ tokens unlock gradually block-by-block over 24 months, aligning them to long-term network growth and mitigating immediate sell pressure. The community thus gained immediate liquidity and ownership, reflecting Enso’s goal of broad distribution.

Enso’s emission schedule beyond the initial allocation appears to be primarily fee-driven rather than inflationary. The total supply is fixed at 100M tokens, and there is no indication of perpetual inflation for block rewards at this time (validators are compensated from fee revenue). This contrasts with many Layer-1 protocols that inflate supply to pay stakers; Enso aims to be sustainable through actual usage fees to reward participants. If network activity is low in early phases, the foundation and treasury allocations can be used to bootstrap incentives for usage and development grants. Conversely, if demand is high, ENSO token’s utility (for fees and staking) could create organic demand pressure.

In summary, ENSO is the fuel of the Enso Network. It powers transactions (query fees), secures the network (staking and slashing), and governs the platform (voting). The token’s value is directly tied to network adoption: as Enso becomes more widely used as the backbone for DeFi applications, the volume of ENSO fees and staking should reflect that growth. The careful distribution (with only a small portion immediately circulating after TGE) and strong backing by top investors (below) provide confidence in the token’s support, while the community-centric sale signals a commitment to decentralization of ownership.

Team and Investors​

Enso Network was founded in 2021 by Connor Howe (CEO) and Gorazd Ocvirk, who previously worked together at Sygnum Bank in Switzerland’s crypto banking sector. Connor Howe leads the project as CEO and is the public face in communications and interviews. Under his leadership, Enso initially launched as a social trading DeFi platform and then pivoted through multiple iterations to arrive at the current intent-based infrastructure vision. This adaptability highlights the team’s entrepreneurial resilience – from executing a high-profile “vampire attack” on index protocols in 2021 to building a DeFi aggregator super-app, and finally generalizing their tooling into Enso’s developer platform. Co-founder Gorazd Ocvirk (PhD) brought deep expertise in quantitative finance and Web3 product strategy, although public sources suggest he may have transitioned to other ventures (he was noted as a co-founder of a different crypto startup in 2022). Enso’s core team today includes engineers and operators with strong DeFi backgrounds. For example, Peter Phillips and Ben Wolf are listed as “blockend” (blockchain backend) engineers, and Valentin Meylan leads research. The team is globally distributed but has roots in Zug/Zurich, Switzerland, a known hub for crypto projects (Enso Finance AG was registered in 2020 in Switzerland).

Beyond the founders, Enso has notable advisors and backers that lend significant credibility. The project is backed by top-tier crypto venture funds and angels: it counts Polychain Capital and Multicoin Capital as lead investors, along with Dialectic and Spartan Group (both prominent crypto funds), and IDEO CoLab. An impressive roster of angel investors also participated across rounds – over 70 individuals from leading Web3 projects have invested in Enso. These include founders or executives from LayerZero, Safe (Gnosis Safe), 1inch, Yearn Finance, Flashbots, Dune Analytics, Pendle, and others. Even tech luminary Naval Ravikant (co-founder of AngelList) is an investor and supporter. Such names signal strong industry confidence in Enso’s vision.

Enso’s funding history: the project raised a $5M seed round in early 2021 to build the social trading platform, and later a $4.2M round (strategic/VC) as it evolved the product (these early rounds likely included Polychain, Multicoin, Dialectic, etc.). By mid-2023, Enso had secured enough capital to build out its network; notably, it operated relatively under the radar until its infrastructure pivot gained traction. In Q2 2025, Enso launched a $5M community token sale on CoinList, which was oversubscribed by tens of thousands of participants. The purpose of this sale was not just to raise funds (the amount was modest given prior VC backing) but to decentralize ownership and give its growing community a stake in the network’s success. According to CEO Connor Howe, “we want our earliest supporters, users, and believers to have real ownership in Enso…turning users into advocates”. This community-focused approach is part of Enso’s strategy to drive grassroots growth and network effects through aligned incentives.

Today, Enso’s team is considered among the thought leaders in the “intent-based DeFi” space. They actively engage in developer education (e.g., Enso’s Shortcut Speedrun attracted 700k participants as a gamified learning event) and collaborate with other protocols on integrations. The combination of a strong core team with proven ability to pivot, blue-chip investors, and an enthusiastic community suggests that Enso has both the talent and the financial backing to execute on its ambitious roadmap.

Adoption Metrics and Use Cases​

Despite being a relatively new infrastructure, Enso has demonstrated significant traction in its niche. It has positioned itself as the go-to solution for projects needing complex on-chain integrations or cross-chain capabilities. Some key adoption metrics and milestones as of mid-2025:

• Ecosystem Integration: Over 100 live applications (dApps, wallets, and services) are using Enso under the hood to power on-chain features. These range from DeFi dashboards to automated yield optimizers. Because Enso abstracts protocols, developers can quickly add new DeFi features to their product by plugging into Enso’s API. The network has integrated with 250+ DeFi protocols (DEXes, lending platforms, yield farms, NFT markets, etc.) across major chains, meaning Enso can execute virtually any on-chain action a user might want, from a Uniswap trade to a Yearn vault deposit. This breadth of integrations significantly reduces development time for Enso’s clients – a new project can support, say, all DEXes on Ethereum, Layer-2s, and even Solana using Enso, rather than coding each integration independently.

• Developer Adoption: Enso’s community now includes 1,900+ developers actively building with its toolkit. These developers might be directly creating Shortcuts/Actions or incorporating Enso into their applications. The figure highlights that Enso isn’t just a closed system; it’s enabling a growing ecosystem of builders who use its shortcuts or contribute to its library. Enso’s approach of simplifying on-chain development (claiming to cut build times from 6+ months down to under a week) has resonated with Web3 developers. This is also evidenced by hackathons and the Enso Templates library where community members share plug-and-play shortcut examples.

• Transaction Volume: Over **$15 billion in cumulative on-chain transaction volume has been settled through Enso’s infrastructure. This metric, as reported in June 2025, underscores that Enso is not just running in test environments – it’s processing real value at scale. A single high-profile example was Berachain’s liquidity migration: In April 2025, Enso powered the movement of liquidity for Berachain’s testnet campaign (“Boyco”) and facilitated $3.1B in executed transactions over 3 days, one of the largest liquidity events in DeFi history. Enso’s engine successfully handled this load, demonstrating reliability and throughput under stress. Another example is Enso’s partnership with Uniswap: Enso built a Uniswap Position Migrator tool (in collaboration with Uniswap Labs, LayerZero, and Stargate) that helped users seamlessly migrate Uniswap v3 LP positions from Ethereum to another chain. This tool simplified a typically complex cross-chain process (with bridging and re-deployment of NFTs) into a one-click shortcut, and its release showcased Enso’s ability to work alongside top DeFi protocols.

• Real-World Use Cases: Enso’s value proposition is best understood through the diverse use cases it enables. Projects have used Enso to deliver features that would be very difficult to build alone:

  • Cross-Chain Yield Aggregation: Plume and Sonic used Enso to power incentivized launch campaigns where users could deposit assets on one chain and have them deployed into yields on another chain. Enso handled the cross-chain messaging and multi-step transactions, allowing these new protocols to offer seamless cross-chain experiences to users during their token launch events.
  • Liquidity Migration and Mergers: As mentioned, Berachain leveraged Enso for a “vampire attack”-like migration of liquidity from other ecosystems. Similarly, other protocols could use Enso Shortcuts to automate moving users’ funds from a competitor platform to their own, by bundling approvals, withdrawals, transfers, and deposits across platforms into one intent. This demonstrates Enso’s potential in protocol growth strategies.
  • DeFi “Super App” Functionality: Some wallets and interfaces (for instance, the Eliza OS crypto assistant and the Infinex trading platform) integrate Enso to offer one-stop DeFi actions. A user can, in one click, swap assets at the best rate (Enso will route across DEXes), then lend the output to earn yield, then perhaps stake an LP token – all of which Enso can execute as one Shortcut. This significantly improves user experience and functionality for those apps.
  • Automation and Bots: The presence of “agents” and even AI-driven bots using Enso is emerging. Because Enso exposes an API, algorithmic traders or AI agents can input a high-level goal (e.g. “maximize yield on X asset across any chain”) and let Enso find the optimal strategy. This has opened up experimentation in automated DeFi strategies without needing custom bot engineering for each protocol.

• User Growth: While Enso is primarily a B2B/B2Dev infrastructure, it has cultivated a community of end-users and enthusiasts through campaigns. The Shortcut Speedrun – a gamified tutorial series – saw over 700,000 participants, indicating widespread interest in Enso’s capabilities. Enso’s social following has grown nearly 10x in a few months (248k followers on X as of mid-2025), reflecting strong mindshare among crypto users. This community growth is important because it creates grassroots demand: users aware of Enso will encourage their favorite dApps to integrate it or will use products that leverage Enso’s shortcuts.

In summary, Enso has moved beyond theory to real adoption. It is trusted by 100+ projects including well-known names like Uniswap, SushiSwap, Stargate/LayerZero, Berachain, zkSync, Safe, Pendle, Yearn and more, either as integration partners or direct users of Enso’s tech. This broad usage across different verticals (DEXs, bridges, layer-1s, dApps) highlights Enso’s role as general-purpose infrastructure. Its key traction metric – $15B+ in transactions – is especially impressive for an infrastructure project at this stage and validates market fit for an intent-based middleware. Investors can take comfort that Enso’s network effects appear to be kicking in: more integrations beget more usage, which begets more integrations. The challenge ahead will be converting this early momentum into sustained growth, which ties into Enso’s positioning against competitors and its roadmap.

Competitor Landscape​

Enso Network operates at the intersection of DeFi aggregation, cross-chain interoperability, and developer infrastructure, making its competitive landscape multi-faceted. While no single competitor offers an identical product, Enso faces competition from several categories of Web3 protocols:

• Decentralized Middleware & Indexing: The most direct analogy is The Graph (GRT). The Graph provides a decentralized network for querying blockchain data via subgraphs. Enso similarly crowd-sources data providers (Action Providers) but goes a step further by enabling transaction execution in addition to data fetching. Whereas The Graph’s ~$924M market cap is built on indexing alone, Enso’s broader scope (data + action) positions it as a more powerful tool in capturing developer mindshare. However, The Graph is a well-established network; Enso will have to prove the reliability and security of its execution layer to achieve similar adoption. One could imagine The Graph or other indexing protocols expanding into execution, which would directly compete with Enso’s niche.

• Cross-Chain Interoperability Protocols: Projects like LayerZero, Axelar, Wormhole, and Chainlink CCIP provide infrastructure to connect different blockchains. They focus on message passing and bridging assets between chains. Enso actually uses some of these under the hood (e.g., LayerZero/Stargate for bridging in the Uniswap migrator) and is more of a higher-level abstraction on top. In terms of competition, if these interoperability protocols start offering higher-level “intent” APIs or developer-friendly SDKs to compose multi-chain actions, they could overlap with Enso. For example, Axelar offers an SDK for cross-chain calls, and Chainlink’s CCIP could enable cross-chain function execution. Enso’s differentiator is that it doesn’t just send messages between chains; it maintains a unified engine and library of DeFi actions. It targets application developers who want a ready-made solution, rather than forcing them to build on raw cross-chain primitives. Nonetheless, Enso will compete for market share in the broader blockchain middleware segment where these interoperability projects are well funded and rapidly innovating.

• Transaction Aggregators & Automation: In the DeFi world, there are existing aggregators like 1inch, 0x API, or CoW Protocol that focus on finding optimal trade routes across exchanges. Enso’s Grapher mechanism for intents is conceptually similar to CoW Protocol’s solver competition, but Enso generalizes it beyond swaps to any action. A user intent to “maximize yield” might involve swapping, lending, staking, etc., which is outside the scope of a pure DEX aggregator. That said, Enso will be compared to these services on efficiency for overlapping use cases (e.g., Enso vs. 1inch for a complex token swap route). If Enso consistently finds better routes or lower fees thanks to its network of Graphers, it can outcompete traditional aggregators. Gelato Network is another competitor in automation: Gelato provides a decentralized network of bots to execute tasks like limit orders, auto-compounding, or cross-chain transfers on behalf of dApps. Gelato has a GEL token and an established client base for specific use cases. Enso’s advantage is its breadth and unified interface – rather than offering separate products for each use case (as Gelato does), Enso offers a general platform where any logic can be encoded as a Shortcut. However, Gelato’s head start and focused approach in areas like automation could attract developers who might otherwise use Enso for similar functionalities.

• Developer Platforms (Web3 SDKs): There are also Web2-style developer platforms like Moralis, Alchemy, Infura, and Tenderly that simplify building on blockchains. These typically offer API access to read data, send transactions, and sometimes higher-level endpoints (e.g., “get token balances” or “send tokens across chain”). While these are mostly centralized services, they compete for the same developer attention. Enso’s selling point is that it’s decentralized and composable – developers are not just getting data or a single function, they’re tapping into an entire network of on-chain capabilities contributed by others. If successful, Enso could become “the GitHub of on-chain actions,” where developers share and reuse Shortcuts, much like open-source code. Competing with well-funded infrastructure-as-a-service companies means Enso will need to offer comparable reliability and ease-of-use, which it is striving for with an extensive API and documentation.

• Homegrown Solutions: Finally, Enso competes with the status quo – teams building custom integrations in-house. Traditionally, any project wanting multi-protocol functionality had to write and maintain smart contracts or scripts for each integration (e.g., integrating Uniswap, Aave, Compound separately). Many teams might still choose this route for maximum control or due to security considerations. Enso needs to convince developers that outsourcing this work to a shared network is secure, cost-effective, and up-to-date. Given the speed of DeFi innovation, maintaining one’s own integrations is burdensome (Enso often cites that teams spend 6+ months and $500k on audits to integrate dozens of protocols). If Enso can prove its security rigor and keep its action library current with the latest protocols, it can convert more teams away from building in silos. However, any high-profile security incident or downtime in Enso could send developers back to preferring in-house solutions, which is a competitive risk in itself.

Enso’s Differentiators: Enso’s primary edge is being first-to-market with an intent-focused, community-driven execution network. It combines features that would require using multiple other services: data indexing, smart contract SDKs, transaction routing, and cross-chain bridging – all in one. Its incentive model (rewarding third-party developers for contributions) is also unique; it could lead to a vibrant ecosystem where many niche protocols get integrated into Enso faster than any single team could do, similar to how The Graph’s community indexes a long tail of contracts. If Enso succeeds, it could enjoy a strong network effect moat: more Actions and Shortcuts make it more attractive to use Enso versus competitors, which attracts more users and thus more Actions contributed, and so on.

That said, Enso is still in its early days. Its closest analog, The Graph, took years to decentralize and build an ecosystem of indexers. Enso will similarly need to nurture its Graphers and Validators community to ensure reliability. Large players (like a future version of The Graph, or a collaboration of Chainlink and others) could decide to roll out a competing intent execution layer, leveraging their existing networks. Enso will have to move quickly to solidify its position before such competition materializes.

In conclusion, Enso sits at a competitive crossroads of several important Web3 verticals – it’s carving a niche as the “middleware of everything”. Its success will depend on outperforming specialized competitors in each use case (or aggregating them) and continuing to offer a compelling one-stop solution that justifies developers choosing Enso over building from scratch. The presence of high-profile partners and investors suggests Enso has a foot in the door with many ecosystems, which will be advantageous as it expands its integration coverage.

Roadmap and Ecosystem Growth​

Enso’s development roadmap (as of mid-2025) outlines a clear path toward full decentralization, multi-chain support, and community-driven growth. Key milestones and planned initiatives include:

• Mainnet Launch (Q3 2024) – Enso launched its mainnet network in the second half of 2024. This involved deploying the Tendermint-based chain and initializing the Validator ecosystem. Early validators were likely permissioned or selected partners as the network bootstrapped. The mainnet launch allowed real user queries to be processed by Enso’s engine (prior to this, Enso’s services were accessible via a centralized API while in beta). This milestone marked Enso’s transition from an in-house platform to a public decentralized network.

• Network Participant Expansion (Q4 2024) – Following mainnet, the focus shifted to decentralizing participation. In late 2024, Enso opened up roles for external Action Providers and Graphers. This included releasing tooling and documentation for developers to create their own Actions (smart contract adapters) and for algorithm developers to run Grapher nodes. We can infer that incentive programs or testnet competitions were used to attract these participants. By end of 2024, Enso aimed to have a broader set of third-party actions in its library and multiple Graphers competing on intents, moving beyond the core team’s internal algorithms. This was a crucial step to ensure Enso isn’t a centralized service, but a true open network where anyone can contribute and earn ENSO tokens.

• Cross-Chain Expansion (Q1 2025) – Enso recognizes that supporting many blockchains is key to its value proposition. In early 2025, the roadmap targeted integration with new blockchain environments beyond the initial EVM set. Specifically, Enso planned support for Monad, Solana, and Movement by Q1 2025. Monad is an upcoming high-performance EVM-compatible chain (backed by Dragonfly Capital) – supporting it early could position Enso as the go-to middleware there. Solana integration is more challenging (different runtime and language), but Enso’s intent engine could work with Solana by using off-chain graphers to formulate Solana transactions and on-chain programs acting as adapters. Movement refers to Move-language chains (perhaps Aptos/Sui or a specific one called Movement). By incorporating Move-based chains, Enso would cover a broad spectrum of ecosystems (Solidity and Move, as well as existing Ethereum rollups). Achieving these integrations means developing new Action modules that understand Solana’s CPI calls or Move’s transaction scripts, and likely collaborating with those ecosystems for oracles/indexing. Enso’s mention in updates suggests these were on track – for example, a community update highlighted partnerships or grants (the mention of “Eclipse mainnet live + Movement grant” in a search result suggests Enso was actively working with novel L1s like Eclipse and Movement by early 2025).

• Near-Term (Mid/Late 2025) – Although not explicitly broken out in the one-pager roadmap, by mid-2025 Enso’s focus is on network maturity and decentralization. The completion of the CoinList token sale in June 2025 is a major event: the next steps would be token generation and distribution (expected around July 2025) and launching on exchanges or governance forums. We anticipate Enso will roll out its governance process (Enso Improvement Proposals, on-chain voting) so the community can start participating in decisions using their newly acquired tokens. Additionally, Enso will likely move from “beta” to a fully production-ready service, if it hasn’t already. Part of this will be security hardening – conducting multiple smart contract audits and perhaps running a bug bounty program, considering the large TVLs involved.

• Ecosystem Growth Strategies: Enso is actively fostering an ecosystem around its network. One strategy has been running educational programs and hackathons (e.g., the Shortcut Speedrun and workshops) to onboard developers to the Enso way of building. Another strategy is partnering with new protocols at launch – we’ve seen this with Berachain, zkSync’s campaign, and others. Enso is likely to continue this, effectively acting as an “on-chain launch partner” for emerging networks or DeFi projects, handling their complex user onboarding flows. This not only drives Enso’s volume (as seen with Berachain) but also integrates Enso deeply into those ecosystems. We expect Enso to announce integrations with more Layer-2 networks (e.g., Arbitrum, Optimism were presumably already supported; perhaps newer ones like Scroll or Starknet next) and other L1s (Polkadot via XCM, Cosmos via IBC or Osmosis, etc.). The long-term vision is that Enso becomes chain-ubiquitous – any developer on any chain can plug in. To that end, Enso may also develop better bridgeless cross-chain execution (using techniques like atomic swaps or optimistic execution of intents across chains), which could be on the R&D roadmap beyond 2025.

• Future Outlook: Looking further, Enso’s team has hinted at involvement of AI agents as network participants. This suggests a future where not only human developers, but AI bots (perhaps trained to optimize DeFi strategies) plug into Enso to provide services. Enso might build out this vision by creating SDKs or frameworks for AI agents to safely interface with the intent engine – a potentially groundbreaking development merging AI and blockchain automation. Moreover, by late 2025 or 2026, we anticipate Enso will work on performance scaling (maybe sharding its network or using zero-knowledge proofs to validate intent execution correctness at scale) as usage grows.

The roadmap is ambitious but execution so far has been strong – Enso has met key milestones like mainnet launch and delivering real use cases. An important upcoming milestone is the full decentralization of the network. Currently, the network is in a transition: the documentation notes the decentralized network is in testnet and a centralized API was being used for production as of earlier in 2025. By now, with mainnet live and token in circulation, Enso will aim to phase out any centralized components. For investors, tracking this decentralization progress (e.g., number of independent validators, community Graphers joining) will be key to evaluating Enso’s maturity.

In summary, Enso’s roadmap focuses on scaling the network’s reach (more chains, more integrations) and scaling the network’s community (more third-party participants and token holders). The ultimate goal is to cement Enso as critical infrastructure in Web3, much like how Infura became essential for dApp connectivity or how The Graph became integral for data querying. If Enso can hit its milestones, the second half of 2025 should see a blossoming ecosystem around the Enso Network, potentially driving exponential growth in usage.

Risk Assessment​

Like any early-stage protocol, Enso Network faces a range of risks and challenges that investors should carefully consider:

• Technical and Security Risks: Enso’s system is inherently complex – it interacts with myriad smart contracts across many blockchains through a network of off-chain solvers and validators. This expansive surface area introduces technical risk. Each new Action (integration) could carry vulnerabilities; if an Action’s logic is flawed or a malicious provider introduces a backdoored Action, user funds could be at risk. Ensuring every integration is secure required substantial investment (Enso’s team spent over $500k on audits for integrating 15 protocols in its early days). As the library grows to hundreds of protocols, maintaining rigorous security audits is challenging. There’s also the risk of bugs in Enso’s coordination logic – for example, a flaw in how Graphers compose transactions or how Validators verify them could be exploited. Cross-chain execution, in particular, can be risky: if a sequence of actions spans multiple chains and one part fails or is censored, it could leave a user’s funds in limbo. Although Enso likely uses retries or atomic swaps for some cases, the complexity of intents means unknown failure modes might emerge. The intent-based model itself is relatively unproven at scale – there may be edge cases where the engine produces an incorrect solution or an outcome that diverges from the user’s intent. Any high-profile exploit or failure could undermine confidence in the whole network. Mitigation requires continuous security audits, a robust bug bounty program, and perhaps insurance mechanisms for users (none of which have been detailed yet).

• Decentralization and Operational Risks: At present (mid-2025), the Enso network is still in the process of decentralizing its participants. This means there may be unseen operational centralization – for instance, the team’s infrastructure might still be co-ordinating a lot of the activity, or only a few validators/graphers are genuinely active. This presents two risks: reliability (if the core team’s servers go down, will the network stall?) and trust (if the process isn’t fully trustless yet, users must have faith in Enso Inc. not to front-run or censor transactions). The team has proven reliability in big events (like handling $3B volume in days), but as usage grows, scaling the network via more independent nodes will be crucial. There’s also a risk that network participants don’t show up – if Enso cannot attract enough skilled Action Providers or Graphers, the network might remain dependent on the core team, limiting decentralization. This could slow innovation and also concentrate too much power (and token rewards) within a small group, the opposite of the intended design.

• Market and Adoption Risks: While Enso has impressive early adoption, it’s still in a nascent market for “intent-based” infrastructure. There is a risk that the broader developer community might be slow to adopt this new paradigm. Developers entrenched in traditional coding practices might be hesitant to rely on an external network for core functionality, or they may prefer alternative solutions. Additionally, Enso’s success depends on continuous growth of DeFi and multi-chain ecosystems. If the multi-chain thesis falters (for example, if most activity consolidates on a single dominant chain), the need for Enso’s cross-chain capabilities might diminish. On the flip side, if a new ecosystem arises that Enso fails to integrate quickly, projects in that ecosystem won’t use Enso. Essentially, staying up-to-date with every new chain and protocol is a never-ending challenge – missing or lagging on a major integration (say a popular new DEX or a Layer-2) could push projects to competitors or custom code. Furthermore, Enso’s usage could be hurt by macro market conditions; in a severe DeFi downturn, fewer users and developers might be experimenting with new dApps, directly reducing intents submitted to Enso and thus the fees/revenue of the network. The token’s value could suffer in such a scenario, potentially making staking less attractive and weakening network security or participation.

• Competition: As discussed, Enso faces competition on multiple fronts. A major risk is a larger player entering the intent execution space. For instance, if a well-funded project like Chainlink were to introduce a similar intent service leveraging their existing oracle network, they could quickly overshadow Enso due to brand trust and integrations. Similarly, infrastructure companies (Alchemy, Infura) could build simplified multi-chain SDKs that, while not decentralized, capture the developer market with convenience. There’s also the risk of open-source copycats: Enso’s core concepts (Actions, Graphers) could be replicated by others, perhaps even as a fork of Enso if the code is public. If one of those projects forms a strong community or finds a better token incentive, it might divert potential participants. Enso will need to maintain technological leadership (e.g., by having the largest library of Actions and most efficient solvers) to fend off competition. Competitive pressure could also squeeze Enso’s fee model – if a rival offers similar services cheaper (or free, subsidized by VCs), Enso might be forced to lower fees or increase token incentives, which could strain its tokenomics.

• Regulatory and Compliance Risks: Enso operates in the DeFi infrastructure space, which is a gray area in terms of regulation. While Enso itself doesn’t custody user funds (users execute intents from their own wallets), the network does automate complex financial transactions across protocols. There is a possibility that regulators could view intent-composition engines as facilitating unlicensed financial activity or even aiding money laundering if used to shuttle funds across chains in obscured ways. Specific concerns could arise if Enso enablescross-chain swaps that touch privacy pools or jurisdictions under sanctions. Additionally, the ENSO token and its CoinList sale reflect a distribution to a global community – regulators (like the SEC in the U.S.) might scrutinize it as an offering of securities (notably, Enso excluded US, UK, China, etc., from the sale, indicating caution on this front). If ENSO were deemed a security in major jurisdictions, it could limit exchange listings or usage by regulated entities. Enso’s decentralized network of validators might also face compliance issues: for example, could a validator be forced to censor certain transactions due to legal orders? This is largely hypothetical for now, but as the value flowing through Enso grows, regulatory attention will increase. The team’s base in Switzerland might offer a relatively crypto-friendly regulatory environment, but global operations mean global risks. Mitigating this likely involves ensuring Enso is sufficiently decentralized (so no single entity is accountable) and possibly geofencing certain features if needed (though that would be against the ethos of the project).

• Economic Sustainability: Enso’s model assumes that fees generated by usage will sufficiently reward all participants. There’s a risk that the fee incentives may not be enough to sustain the network, especially early on. For instance, Graphers and Validators incur costs (infrastructure, development time). If query fees are set too low, these participants might not profit, leading them to drop off. On the other hand, if fees are too high, dApps may hesitate to use Enso and seek cheaper alternatives. Striking a balance is hard in a two-sided market. The Enso token economy also relies on token value to an extent – e.g., staking rewards are more attractive when the token has high value, and Action Providers earn value in ENSO. A sharp decline in ENSO price could reduce network participation or prompt more selling (which further depresses the price). With a large portion of tokens held by investors and team (over 56% combined, vesting over 2 years), there’s an overhang risk: if these stakeholders lose faith or need liquidity, their selling could flood the market post-vesting and undermine the token’s price. Enso tried to mitigate concentration by the community sale, but it’s still a relatively centralized token distribution in the near term. Economic sustainability will depend on growing genuine network usage to a level where fee revenue provides sufficient yield to token stakers and contributors – essentially making Enso a “cash-flow” generating protocol rather than just a speculative token. This is achievable (think of how Ethereum fees reward miners/validators), but only if Enso achieves widespread adoption. Until then, there is a reliance on treasury funds (15% allocated) to incentivize and perhaps to adjust the economic parameters (Enso governance may introduce inflation or other rewards if needed, which could dilute holders).

Summary of Risk: Enso is pioneering new ground, which comes with commensurate risk. The technological complexity of unifying all of DeFi into one network is enormous – each blockchain added or protocol integrated is a potential point of failure that must be managed. The team’s experience navigating earlier setbacks (like the limited success of the initial social trading product) shows they are aware of pitfalls and adapt quickly. They have actively mitigated some risks (e.g., decentralizing ownership via the community round to avoid overly VC-driven governance). Investors should watch how Enso executes on decentralization and whether it continues to attract top-tier technical talent to build and secure the network. In the best case, Enso could become indispensable infrastructure across Web3, yielding strong network effects and token value accrual. In the worst case, technical or adoption setbacks could relegate it to being an ambitious but niche tool.

From an investor’s perspective, Enso offers a high-upside, high-risk profile. Its current status (mid-2025) is that of a promising network with real usage and a clear vision, but it must now harden its technology and outpace a competitive and evolving landscape. Due diligence on Enso should include monitoring its security track record, the growth of query volumes/fees over time, and how effectively the ENSO token model incentivizes a self-sustaining ecosystem. As of now, the momentum is in Enso’s favor, but prudent risk management and continued innovation will be key to turning this early leadership into long-term dominance in the Web3 middleware space.

Sources:

• Enso Network Official Documentation and Token Sale Materials

  • CoinList Token Sale Page – Key Highlights & Investors
  • Enso Docs – Tokenomics and Network Roles

• Interviews and Media Coverage

  • CryptoPotato Interview with Enso CEO (June 2025) – Background on Enso’s evolution and intent-based design
  • DL News (May 2025) – Overview of Enso’s shortcuts and shared state approach

• Community and Investor Analyses

  • Hackernoon (I. Pandey, 2025) – Insights on Enso’s community round and token distribution strategy
  • CryptoTotem / CoinLaunch (2025) – Token supply breakdown and roadmap timeline

• Enso Official Site Metrics (2025) and Press Releases – Adoption figures and use-case examples (Berachain migration, Uniswap collaboration).

Overview​

Aptos and Sui stand as the next generation of Layer-1 blockchains, both originating from the Move language initially conceived by Meta's Libra/Diem project. While they share a common lineage, their team backgrounds, core objectives, ecosystem strategies, and evolutionary paths have diverged significantly.

Aptos emphasizes versatility and enterprise-grade performance, targeting both DeFi and institutional use cases. In contrast, Sui is laser-focused on optimizing its unique object model to power mass-market consumer applications, particularly in gaming, NFTs, and social media. Which chain will ultimately distinguish itself depends on its ability to evolve its technology to meet the demands of its chosen market niche, while establishing a clear advantage in user experience and developer friendliness.

1. Development Journey​

Aptos​

Born from Aptos Labs—a team formed by former Meta Libra/Diem employees—Aptos began closed testing in late 2021 and launched its mainnet on October 19, 2022. Early mainnet performance drew community skepticism with under 20 TPS, as noted by WIRED, but subsequent iterations on its consensus and execution layers have steadily pushed its throughput to tens of thousands of TPS.

By Q2 2025, Aptos had achieved a peak of 44.7 million transactions in a single week, with weekly active addresses surpassing 4 million. The network has grown to over 83 million cumulative accounts, with daily DeFi trading volume consistently exceeding $200 million (Source: Aptos Forum).

Sui​

Initiated by Mysten Labs, whose founders were core members of Meta's Novi wallet team, Sui launched its incentivized testnet in August 2022 and went live with its mainnet on May 3, 2023. From the earliest testnets, the team prioritized refining its "object model," which treats assets as objects with specific ownership and access controls to enhance parallel transaction processing (Source: Ledger).

As of mid-July 2025, Sui's ecosystem Total Value Locked (TVL) reached $2.326 billion. The platform has seen rapid growth in monthly transaction volume and the number of active engineers, proving especially popular within the gaming and NFT sectors (Source: AInvest, Tangem).

2. Technical Architecture Comparison​

3. On-Chain Ecosystem and Use Cases​

3.1 Ecosystem Scale and Growth​

Aptos In Q1 2025, Aptos recorded nearly 15 million monthly active users and approached 1 million daily active wallets. Its DeFi trading volume surged by 1000% year-over-year, with the platform establishing itself as a hub for financial-grade stablecoins and derivatives (Source: Coinspeaker). Key strategic moves include integrating USDT via Upbit to drive penetration in Asian markets and attracting numerous leading DEXs, lending protocols, and derivatives platforms (Source: Aptos Forum).

Sui In June 2025, Sui's ecosystem TVL reached a new high of $2.326 billion, driven primarily by high-interaction social, gaming, and NFT projects (Source: AInvest). The ecosystem is defined by core projects like object marketplaces, Layer-2 bridges, social wallets, and game engine SDKs, which have attracted a large number of Web3 game developers and IP holders.

3.2 Dominant Use Cases​

• DeFi & Enterprise Integration (Aptos): With its mature BFT finality and a rich suite of financial tools, Aptos is better suited for stablecoins, lending, and derivatives—scenarios that demand high levels of consistency and security.
• Gaming & NFTs (Sui): Sui's parallel execution advantage is clear here. Its low transaction latency and near-zero fees are ideal for high-concurrency, low-value interactions common in gaming, such as opening loot boxes or transferring in-game items.

4. Evolution & Strategy​

Aptos

• Performance Optimization: Continuing to advance sharding research, planning for multi-region cross-chain liquidity, and upgrading the AptosVM to improve state access efficiency.
• Ecosystem Incentives: A multi-hundred-million-dollar ecosystem fund has been established to support DeFi infrastructure, cross-chain bridges, and compliant enterprise applications.
• Cross-Chain Interoperability: Strengthening integrations with bridges like Wormhole and building out connections to Cosmos (via IBC) and Ethereum.

Sui

• Object Model Iteration: Extending the Move syntax to support custom object types and complex permission management while optimizing the parallel scheduling algorithm.
• Driving Consumer Adoption: Pursuing deep integrations with major game engines like Unreal and Unity to lower the barrier for Web3 game development, and launching social plugins and SDKs.
• Community Governance: Promoting the SuiDAO to empower core project communities with governance capabilities, enabling rapid iteration on features and fee models.

5. Core Differences & Challenges​

• Security vs. Parallelism: Aptos's strict resource semantics and consistent consensus provide DeFi-grade security but can limit parallelism. Sui's highly parallel transaction model must continuously prove its resilience against large-scale security threats.
• Ecosystem Depth vs. Breadth: Aptos has cultivated deep roots in the financial sector with strong institutional ties. Sui has rapidly accumulated a broad range of consumer-facing projects but has yet to land a decisive breakthrough in large-scale DeFi.
• Theoretical Performance vs. Real-World Throughput: While Sui has higher theoretical TPS, its actual throughput is still constrained by ecosystem activity. Aptos has also experienced congestion during peak periods, indicating a need for more effective sharding or Layer-2 solutions.
• Market Narrative & Positioning: Aptos markets itself on enterprise-grade security and stability, targeting traditional finance and regulated industries. Sui uses the allure of a "Web2-like experience" and "zero-friction onboarding" to attract a wider consumer audience.

6. The Path to Mass Adoption​

Ultimately, this is not a zero-sum game.

In the medium to long term, if the consumer market (gaming, social, NFTs) continues its explosive growth, Sui's parallel execution and low entry barrier could position it for rapid adoption among tens of millions of mainstream users.

In the short to medium term, Aptos's mature BFT finality, low fees, and strategic partnerships give it a more compelling offering for institutional finance, compliance-focused DeFi, and cross-border payments.

The future is likely a symbiotic one where the two chains coexist, creating a stratified market: Aptos powering financial and enterprise infrastructure, while Sui dominates high-frequency consumer interactions. The chain that ultimately achieves mass adoption will be the one that relentlessly optimizes performance and user experience within its chosen domain.