Zon - Appchains Are The New Apps
1. The Growing Trend of App Chains
Zon emphasized that app chains are becoming increasingly popular, with many players in the crypto space opting to create their own chains tailored to specific applications. He mentioned examples such as Plasma, Hyperlquid, and Echelon, pointing out that app chains provide a more specialized approach to blockchain functionality, allowing developers to cater to particular use cases. This growing trend indicates a future where each application might become its own dedicated chain.
2. Benefits of Sovereignty and Customizability
Zon highlighted two key advantages of app chains: sovereignty and customizability. Sovereignty allows developers full control over their blockchain stack, while customizability enables adjustments to various components, including virtual machines, fee structures, and data availability layers. This flexibility means that developers can efficiently tailor their chains to meet the specific needs of their projects, ultimately enhancing user experience and application functionality.
3. Low Operational Costs of App Chains
Zon shared that, contrary to popular belief, the costs of operating app chains can be quite manageable. With app chains on the Initia stack costing around $2,000 per month, developers can create and maintain their own blockchain environments at a relatively low cost. This affordability is significantly lower than the $6,000 to $7,000 monthly cost associated with more complex platforms. Such economic feasibility can encourage more projects to pursue app chains as a viable option.
4. Revenue Generation through App Chains
Zon illustrated the potential for significant revenue generation through app chains with the example of Pump Fun, which, by transitioning into an app chain, could capture substantial revenues from gas fees. He pointed out that existing protocols could leverage their established user bases to profit from transaction fees. The case studies he discussed show that app chains can provide new avenues for monetization, contributing to the long-term sustainability of applications while fostering growth.
5. Addressing Challenges in the App Chain Space
While Zon was optimistic about app chains’ future, he noted critical challenges that need addressing. Reducing operational costs, improving user experience, and streamlining the development process are crucial for wider adoption. He emphasized the importance of making app chains accessible and user-friendly, so developers can easily create their own chains with minimal effort.
6. The Importance of Network Effects
Zon underlined the role of network effects in driving app chain success. He explained how network effects in monolithic chains lead to a cycle of user acquisition, increased development, and enhanced liquidity. For app chains, the challenge lies in creating interconnected networks where users can seamlessly interact across different chains. He suggested that achieving cross-chain liquidity and utilization could help app chains emulate the virality and growth observed in traditional blockchain ecosystems.
