Vertically Integrated Capital Aggregators

The article argues that in crypto, protocols that integrate vertically, combining liquidity, users and distribution within one venue, build moats that are hard to compete against, and that capital-dense businesses are where value accrues. It cites Hyperliquid, whose builder code fees made up only about 6% of its roughly $1.1 billion cumulative revenue, with most revenue coming from its native front end. By contrast, on Ethereum aggregators account for 36% of DEX trades, while Uniswap has about $5.5 billion in lifetime fees. The author also notes that roughly $1.7 billion was stolen from DeFi and crypto protocols over the trailing twelve months, against about $3.42 billion in protocol revenue.