"Fat Apps" Are Dead, Welcome to the Era of "Fat Distribution"
The article "Fat Apps Are Dead, Welcome to the Era of Fat Distribution" argues that crypto applications are becoming commoditized infrastructure, shifting value from the applications themselves to the distribution channels and front-end interfaces that control user access.
The author traces the evolution of value accumulation theories in crypto, from the 2016 "Fat Protocol" thesis (value accrues to base layers like Ethereum) to the 2022 "Fat App" thesis (value accrues to applications like Uniswap that built liquidity and user experience). By 2025, the thesis has shifted again.
Excessive investment in infrastructure has led to diminishing returns; technical improvements (e.g., minor reductions in oracle costs or interest rate optimizations) are now imperceptible to end-users. Users prioritize familiar interfaces over marginally better backend performance.
Consequently, applications like Aave and Morpho are increasingly focusing on B2B partnerships, embedding their services as backends within other platforms (e.g., traditional fintech apps like Robinhood). The author posits that convincing an existing platform to integrate a feature is far easier than onboarding millions of new users to complex, native crypto workflows.
A case study illustrates this: Coinbase directs its users' borrowing activity to Morpho on Base, even though competitors offer better rates, because the seamless, integrated user experience within the Coinbase app is more valuable to customers than optimizing for cost.
The article concludes that while some apps will remain B2C, the new competitive moat is no longer liquidity or crypto-native UX, but rather control over distribution. The platforms that own the front-end and user relationships will capture the majority of the value.
marsbit12/19 07:55
