Article Compilation: Block unicorn
For most of financial history, moving money was the hard part. The difficulty lay in getting funds from Point A to Point B, passing through a series of banks, each taking a commission along the way. Sometimes, this even involved moving funds across borders.
For the past decade, cryptocurrencies and stablecoins promised to minimize this friction through crypto apps and wallets. But these fast, low-cost transfers are meaningless if the funds cannot be used in the broader economy. A dollar trapped in a crypto wallet is worth less than a real one. This is why crypto is now playing the role of a more efficient infrastructure for moving existing traditional assets.
The convergence of the old and new financial systems has given rise to a new intermediate layer where value is being captured. In today's article, I will explore who is capturing value in this new layer.
The Necessity of Web 2.5
For over a decade, the crypto industry has tried to convince people to download wallets, bridge assets between blockchains, and store funds in new apps. But people won't abandon systems they've known and used for decades just to try something new. No supplier wants to receive payment via a blockchain and then watch that money sit in their wallet, waiting for them to figure out how to get it back into a bank account for daily expenses. Moving funds from a wallet to a bank account incurs fees and, in most cases, requires compliance checks.
The problem was never crypto's ability to transfer funds in seconds; it was the architecture that demanded people abandon the systems they already used, such as bank accounts, credit cards, and payroll systems, in favor of entirely new ones. The entry points, exit points, and bridging solutions are friction points that need to be hidden, not features to be celebrated. People will always adopt new technology that moves their existing funds faster and cheaper into their existing accounts.
The ideal infrastructure is crypto acting as an efficient, invisible enabler and the underlying carrier for traditional finance. We call this optimal state "Web 2.5." While the term may sound a bit clumsy, the idea behind it is to capture the best of both worlds. We keep the good parts of traditional finance, such as regulation, licensing, verification, and the user interfaces and experiences people already trust and use. Then, we combine it with crypto's low-cost, programmable, and always-on settlement. They don't need to replace each other. Banks remain banks, while crypto breathes new life into the slow, antiquated infrastructure that previously moved money.
But if crypto becomes the invisible foundation and traditional finance the familiar surface, where is value captured in this new world of Web 2.5?
The layer connecting the two financial systems has historically been worth more than most of the institutions it connects. Visa made $24 billion in operating profit last year (fiscal year ending September 2025) with fees of less than one percent per transaction on its network. Yet, its operating margin remains as high as 60%. The Depository Trust & Clearing Corporation (DTCC), which is currently building its own on-chain settlement system, processed $47 quadrillion in securities transactions in 2025, generating $2.9 billion in profit.
The Intermediate Layer
Institutions on both sides are now building conversion layers that allow banks to retain their infrastructure while translating ISO 20022 instructions for on-chain settlement.
On June 23rd, Chainlink, along with a consortium of more than 50 European and Korean banks (with total assets of approximately $10 trillion), announced the launch of Project Pangea to test real-time settlement of foreign exchange transactions.
The goal is to transition FX settlement infrastructure from the traditional T+2 cycle to a real-time T+0 model.
Chainlink's Chainlink Runtime Environment (CRE) acts as an orchestration layer, connecting blockchains with other external payment systems without requiring manual routing or bridging. It translates each regular instruction into an on-chain atomic swap and returns the result for the banking system to read.
Chainlink is a relatively new technology. Yet, the 50-year-old DTCC, situated at the center of the American market (which processed approximately $4.7 quadrillion in securities transactions last year), chose the same Chainlink Runtime to support its collateral AppChain.
On the traditional institution side, SWIFT is an example. According to early predictions for crypto, SWIFT was the institution that blockchain was supposed to replace. Many predicted stablecoins would bypass this messaging monopoly. Eight years ago, this global messaging network for banks said blockchain "was not ready for mainstream." However, SWIFT is now building a blockchain-based shared ledger with over 40 banks.
This is not a replacement for the SWIFT network but an orchestration layer built on top of it. The movement of funds on-chain was never the threat itself. For SWIFT, the concern was being excluded from the layer that decides how funds move on-chain. As long as it can participate and have a say in the decision-making process, it stays in the game. So, it is building this layer itself.
Even nation-states are rushing into this space, trying to capture value. The Bank for International Settlements (BIS) convened seven central banks and over forty private institutions to launch "Project Agorá," aiming to test atomic settlement using tokenized central bank reserves.
But is the real value in building a bridge between two financial and/or banking giants?
The Value of Bridges
A translation layer that merely gets two parties talking is likely to be more valuable than the players themselves.
Visa and Mastercard started as routing networks between banks and merchants. Even today, they do not hold deposits, issue any cards, or assume any risk. Yet, Visa's market capitalization exceeds that of all global banks except JPMorgan Chase.
The value from operating the translation layer extends beyond just money. Those who decide where funds flow also have the power to decide when to shut off that flow.
The SWIFT system was born in 1973 as simply a way for banks to send standardized messages to each other. Fifty years later, it wields the power to impose sanctions on countries. Over the past decade, the SWIFT system has played a significant role in economic warfare, such as the sanctions imposed on Russia over the war in Ukraine. It even imposed EU sanctions on Iranian banks to curb the country's nuclear program, later relaxing them as progress was made on the nuclear deal.
Chainlink's current collaboration with Project Pangea on a pilot for addressable liquidity pools for real-time FX settlement is significant.
Cross-border payments amount to $150-190 trillion annually and are projected to exceed $250 trillion by 2030. If Chainlink, along with its consortium of 50 banks, can capture even 1% of that, it implies a Total Addressable Market (TAM) exceeding $1.5 trillion. Even charging just 0.1% in fees would translate to $1.5 billion in revenue for Chainlink by bridging traditional finance with on-chain settlement.
But there's a catch. Both SWIFT and Visa became dominant standards in their respective fields, eventually forcing the entire system to adopt them. There's only one winner per field, consolidating their position over decades.
Now we have four different models—protocols, market utilities, bank cooperatives, and central bank clubs—all vying for the same single translation layer to connect the Web 2.0 and Web 3.0 financial worlds.
Permission and Float
The economic mechanisms driving value in this layer are age-old. As technology for moving funds advanced, the transaction processing itself gradually became a commodity. As the cost of moving funds decreased, the value that could be captured focused on two main aspects. First, permission—the power of those who decide whether a transaction is permissible and under what conditions. Second, float—the interest earned on funds sitting idle while awaiting transfer.
We have previously written about how this works when payments happen between AI agents (see here and here). Today, the same logic applies to settlement between banks.
This is precisely what makes the middle coordination layer worth fighting over. It creates a two-sided network effect. The more banks that connect on one side, the more attractive it becomes for settlement institutions on the other side, and vice versa. Each additional institution raises the cost for existing ones to leave. While individual banks and blockchains compete, the institution coordinating the conversion layer serves all banks and blockchains and collects fees for doing so.
Stripe employed the same strategy in card payments. It made it easy for businesses of all sizes to accept and manage online payments through a simple, developer-friendly API that hid the complexities of payment processors, acquirers, and networks. Then, it charged all its users a fee to remove that friction and hide it in the background.
This is why connection layers become hot acquisition targets. Once someone builds the connection layer, others would rather acquire it than rebuild it from scratch. We saw this five years ago when Visa agreed to acquire Plaid for $5.3 billion. Although the deal ultimately fell through due to a Department of Justice antitrust lawsuit, the intent was clear. Visa was attempting to acquire Plaid's market share of the connection layer that linked thousands of fintech apps to bank accounts.
The New World of Web 2.5
The world of Web 2.5 is more promising than the utopian vision of a fully decentralized Web 3.0 because it doesn't require capital to flee existing players to access the services crypto provides. Instead, it leverages crypto as the underlying, more efficient infrastructure for moving money and assets within the existing ecosystem.
While bank-side projects, including Pangea, DTCC's AppChain, and Agorá, remain in pre-production stages, we are optimistic about the direction of players like Chainlink. For too long, crypto's internal debates have centered on how to build better crypto apps to lure users away from traditional payment rails. Developers have argued over which blockchain has the lowest gas fees and which token is best to hold. Web 2.5 renders these debates moot by removing all the jargon and hiding the infrastructure in the background.
The internet we use is, in essence, packets of data transmitted over a global computer network. That's a nice bit of knowledge, but it's nothing to boast about if you just want to go online. No one cares whether the technology enabling these lightning-fast, low-cost transactions is crypto or something else.
Blockchain is gradually commoditizing into an interchangeable, invisible, and low-margin component of a transaction. Its value now lies in the business model of how money flows and grants some say in how it flows and whether it flows at all.
