GuShiio.com In-depth elaboration of the important strategic value and development prospects of the consumer cryptocurrency market.
Original text:Peter Yuan Pan, 1kx Partner
Compiled by: Yuliya, PANews
This research was originally presented to its limited partners by 1kx Network and elaborated in depth on the important strategic values and development prospects of the consumer cryptocurrency market. The following are the latest market observations.
Evolution rules of new platforms
In the history of technological development, whenever a new platform appears, a new leader will inevitably be born in the market. Existing market leaders often lose their market position through misjudgment, slow response, or poor execution of new opportunities. The fundamental reason for this phenomenon is that new technological paradigms require new thinking models and business strategies. This rule has been fully verified in the field of games and video over the past decade.
The disruptive evolution of the mobile game market
In the 2000s, the traditional gaming market was dominated by hard-core games, with players generally pursuing high-fidelity images and deeply immersive experiences. At that time, mobile devices were completely at odds with the needs of the mainstream game market due to their small screens, limited performance, and lack of high-quality content. Traditional gamers have little interest in mobile games, and mainstream game publishers have ignored this emerging market.
However, the potential of mobile gaming platforms is obvious. It finally realized the vision of allowing users to compete online with global players anytime and anywhere, creating a new category of mobile free games. This not only created an unprecedented emerging player market, but also spawned a number of new game companies. These successful players are completely based on game types that are completely different from traditional games, and their target users do not even recognize the identity tags of traditional game players.
Although the industry generally believed at the time that"These are not real games, and these are not real gamers.", but mobile games have finally achieved an astonishing achievement that exceeds twice the revenue of traditional games.
Market changes in video
The online video field has also shown a similar disruptive development pattern. In an era when television networks dominate global media consumption, the limitations of this traditional model have become increasingly prominent: high barriers to entry, expensive production costs, and limited distribution scope to local or regional markets. Even so, traditional entertainment industry executives still underestimate the development potential of online video.
However, forward-looking market observers have recognized the revolutionary characteristics of online video platforms: decentralization, low barriers to entry, and natural globalization. These characteristics have brought disruptive changes to content creation and dissemination.
As a result of market changes,The traditional entertainment industry has been restructured and new media companies have emerged.Similar to the mobile gaming field, these emerging content is fundamentally different from the content forms of traditional platforms. A new generation of entertainment stars and brands (such as Mr. Beast, Bella Poarch, etc.) have rapidly emerged and have spawned innovative business models (such as Shein) that rely on online video distribution channels. Online video eventually surpassed traditional TV and maintained a sustained growth trend.
Blockchain: A new generation of consumer platforms
Blockchain technology is creating a new platform paradigm for consumers. This technology allows developers to build an application ecosystem with digital property rights and programmable incentives from scratch in a decentralized, global environment.
Market analysis shows that this will bring revolutionary innovations to games, social media, creator economy and other fields, and give rise to a new market shape. Similar to the development trajectory of mobile games and online video, this market change will be achieved through content forms completely different from traditional platforms and create new user groups and market spaces.
Vertical integration advantages
Market leaders in the consumer cryptocurrency space will gain unprecedented growth potential thanks to their unique advantages of vertical integration in a decentralized environment.In traditional markets, the most successful companies are often those that can achieve vertical integration。Take Amazon as an example. Although it initially started as an e-commerce platform, its cloud services division AWS now contributes 70-80% of the group’s operating profit (only 15-17% of total revenue).
Companies in the traditional consumer sector generally pursue vertical integration, but they are often limited by technology costs. The open source nature of the Web3 ecosystem allows market leaders to naturally realize vertical integration as business grows, more effectively control all links of the value chain, gain scale effects, and achieve flexible business monetization. this makesLeading companies in the consumer cryptocurrency space are able to achieve faster growth rates and larger business scales than their Web2 competitors.
Market practice verification
This vertical integration strategy has been verified in multiple cases:
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Coinbase started with a centralized exchange business and then launched the Base Chain Network
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Axie Infinity develops the Ronin Network based on its large user base
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Puggy Penguins leverages existing distribution channels to build Abstract Chain
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LINE and Kakao launch Kaia Chain with user advantages
Consumer-grade encryption technology is considered to be the ultimate form of the development of the consumer Internet. With the continuous advancement of blockchain and encryption technology, its application potential in the consumer field has become increasingly significant, which may reshape the way consumers interact with the Internet and become an important driving force for the future digital economy.
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