The awakening of crypto consumption: from fringe applications to mainstream entry

If cryptocurrencies still need applications outside of finance to explain their value, it precisely indicates that a new growth trend is taking shape. Consumer crypto—namely, mainstream blockchain applications aimed at ordinary users—is becoming the key engine driving industry growth. Whether in digital media, social platforms, or virtual gaming, the total potential market size in these sectors reaches up to $3 trillion, while NFT technology and smart contracts are rewriting business logic for these industries.

The Three Core Drivers of Consumer crypto

The ability of consumer-grade applications to change the landscape of the crypto market relies on three key technological elements.

First is the realization of digital ownership. NFTs essentially extend the concept of “scarcity” created by Bitcoin to all digital content. In the past, music, art, articles, videos, and other content faced the problem of unlimited copying, making true “ownership” impossible. NFTs change all that—any file format (.jpeg, .pdf, .wav, .mp3, .mp4, etc.) can be encrypted and rights-verified to become scarce, tradable, and collectible digital assets. This technology, called Cryptomedia, is creating a whole new content economy.

Second is permissionless infrastructure. Smart contracts provide an open space for application development, allowing developers and enterprises to create economic activity on fully open infrastructure without approval from any centralized platform. This breaks the monopoly of large platforms typical of Web2, enabling social and gaming applications to grow within a free competitive ecosystem.

Third is on-chain user identity. Users establish and reinforce their network identity by holding NFTs and on-chain assets. This is both a symbol of identity and a source of community belonging—ownership certificates for art, music, characters, and other assets collected by an individual become part of their online identity.

From 95 Yuan transaction fees to below one dollar: the evolution of user experience

Before consumer crypto can truly attract the masses, a fundamental issue must be addressed: user experience.

The situation in recent years is hard to imagine. Users had to buy cryptocurrencies on exchanges, download wallets, write down seed phrases, and pay nearly $20 in fees for each transaction, with the barrier to purchase an NFT exceeding $200. Such experiences are unacceptable to ordinary users.

Now, the situation has been completely reversed. Take top consumer apps like Sound as an example: users can log in directly with email, pay instantly via Apple Face ID, and purchase a music NFT for less than $1—often without even realizing they have set up a wallet, exchanged crypto, or completed the transaction on Layer 2.

However, achieving this level of experience requires app developers to spend 3 to 6 months integrating wallet providers, credit card channels, and Layer 2 networks. Even with the best toolkits, UX challenges remain. Especially from both developer and user perspectives, further innovation is needed in Layer 2 integration.

Nevertheless, most consumer applications are already preparing to serve more users, with key infrastructure and user experience tools gradually being refined.

Ownership, speculation, and gamification: the three layers of value in consumer crypto

The appeal of consumer crypto is not just about ownership itself, but also about the multiple dimensions of value it offers.

Ownership value first means users can become true collectors. Someone can own music, art, or game characters from their favorite creators, with proof of ownership permanently stored on-chain. This sense of possession directly translates into user loyalty and establishes a direct connection with creators.

Speculation value is often criticized, but in reality, it is a key mechanism driving market liquidity. When users realize that early NFTs they collect might appreciate or that they can profit from resale, they are motivated to participate. Interestingly, this speculation mechanism creates open markets for any on-chain asset, allowing users to benefit from supporting their preferred projects. Besides potential profits, collectors gain opportunities to build relationships with creators and communities, and to strengthen their online identity through on-chain asset data.

Gamification is a dimension that has only recently gained attention. Applications no longer rely solely on ownership and speculation to attract users but incorporate ranking systems, social achievements, community levels, and other gamified mechanisms to enhance user engagement. These are reflected in media apps (like Sound, SuperRare, Foundation user rankings), gaming apps (like Axie Infinity’s play-to-earn rewards), and community management.

The beauty of gamification is that it can sustain growth even in bear markets, something that pure ownership value cannot achieve. When the market declines, applications driven solely by speculation tend to lose users, whereas those with strong gamified experiences can retain users and continue to grow.

Content revolution: from subscription models to ownership-based models

The crypto media space is undergoing a fundamental shift in business models.

Traditional content industries rely on subscription or advertising models, which have obvious drawbacks—users pay but do not own the content, and platforms profit from ads while bombarding users with spam. The new model driven by consumer crypto is: content is directly stored on-chain, issued as NFTs, and users can buy, hold, and trade them.

This is similar to the “free + virtual item payment” model in Web2 gaming but with clear advantages: users can experience content for free, and if they like it, they can purchase and collect it, while creators receive direct income without relying on platform intermediaries.

Early crypto media platforms have already taken shape: SuperRare and Foundation focus on digital art; Sound and Catalog specialize in music; Paragraph and Mirror serve writers; Pods provide stages for podcasters. Most of these platforms have overcome early UX hurdles, offering email login, Layer 2 support, credit card entry, and other consumer-grade experiences.

The core gameplay of these platforms is establishing user identity. Top collectors rank on leaderboards; creators gain exposure through collection volume; communities maintain cohesion through shared collections. This model benefits artists and also changes how collectors derive value—early supporters can profit from reselling rare works, similar to how Bob could sell early music from a musician he supported.

It’s worth noting that many leading crypto media applications are developing on-chain protocols, such as SuperRare’s governance protocol, Sound and Zora’s minting protocols, Manifold and Titles’ issuance protocols. These protocols provide permissionless infrastructure for other applications, and as the consumer media stack on-chain continues to improve, applications can better customize experiences and explore new business models.

On-chain virtual worlds: from Web2.5 to fully on-chain games

The gaming sector’s consumer crypto applications are showing more aggressive technological approaches.

The earliest crypto games adopted a Web2.5 model—adding NFTs to Web2 games, allowing in-game items to be traded and resold. But this model has fundamental limitations: game rules and economic mechanisms are still controlled by the development team, and players cannot truly participate in the game’s evolution.

Fully on-chain games (FOCG) completely rewrite this logic. All game rules and economic mechanisms are managed by on-chain smart contracts, meaning developers can build new games on existing ones without permission. This permissionless composability opens endless possibilities for the gaming ecosystem.

A classic example is the Loot ecosystem. Loot, released in August 2021, is a collection of 8,000 NFTs, each representing a virtual adventure gear pack. What started as a simple project has spawned multiple cross-technology games like Realms, Dope Wars, and Treasure, each establishing its own ecosystem. This exemplifies the infinite possibilities of consumer crypto—a foundational asset can become the cornerstone of an entire gaming universe.

Currently, the on-chain gaming ecosystem spans multiple blockchains. Ethereum supports frameworks like MUD with games such as Primodium and Skystrife; Starknet supports DoJo with Realms and Dope Wars; Solana has Bolt supporting SolCIV and Sage. Each framework has open-source tools and a mature developer community.

Even more exciting, the emergence of the ERC6551 standard allows NPCs within games to become NFTs—these characters can have their own wallets, owned and controlled by real players, representing players’ actions in the game. This means each NPC is not just a game asset but also an autonomous on-chain entity.

Although still in early stages, consumer crypto on-chain games require significant infrastructure improvements: more efficient transaction processing, better wallet abstraction, lower Gas fees, and enhanced game engines and service layers.

Why consumer crypto is an inevitable trend in the crypto market

The crypto market has long faced a dilemma: speculation can drive short-term growth, but sustainable, healthy growth depends on real users and practical applications.

DeFi products meet genuine market demand, but their audience is primarily financial professionals. Ordinary users—billions of internet users—are the ones releasing purchasing power through consumption scenarios. Their spending behaviors in media, entertainment, and gaming are the true drivers for the real-world adoption of crypto applications.

This is why institutional and retail investors increasingly focus on user growth data when evaluating crypto projects. Without this data, investments based solely on technological upgrades and narrative shifts are hard to sustain. Consumer crypto precisely provides this critical “user story”—showing ordinary people their real needs within this ecosystem.

For the crypto market, consumer crypto is not only a high-potential track but also a necessity. Killer applications are emerging in this space, and the growth of user data and adoption rates will ultimately determine whether the crypto market can shift from speculation to genuine value creation.