TLDR
- ARK Invest analyst Lorenzo Valente says crypto is entering its biggest consolidation phase in history
- Hyperliquid and Pump.fun together account for about 67% of total crypto application revenue
- Adding Ethena brings the top three protocols’ combined share to nearly 80%
- BitMEX and BitMart both announced plans to shut down exchange operations
- Bybit expanded into Indonesia after acquiring a majority stake in digital asset firm NOBI
An analyst at ARK Invest says the crypto industry is going through its biggest consolidation phase yet. Revenue is becoming concentrated among a small group of protocols, while weaker projects fall behind.
Lorenzo Valente, a research associate at ARK Invest, shared the view in a post on X on Wednesday. He said investors have grown more selective with their money.
This makes it harder for smaller crypto projects to raise capital. Valente said this is especially true for platforms that lack a strong product that people actually want to use.
As weaker projects shut down or struggle, revenue keeps shifting toward a small number of dominant platforms. Valente pointed to hard numbers to back up his claim.
Revenue Concentration Grows
According to Valente, perpetual futures exchange Hyperliquid and memecoin launchpad Pump.fun together make up roughly 67% of all crypto application revenue. That is more than two thirds of the entire market’s revenue coming from just two platforms.
When synthetic dollar protocol Ethena is added to the mix, the top three platforms’ combined share rises to nearly 80%. Valente called this a record level of revenue concentration for the sector.
He expects this trend to continue over the coming months. Valente said this will likely lead to more mergers, acquisitions, and Chapter 11 bankruptcies.
He also expects more project shutdowns and acqui-hires, where a company is bought mainly to bring its team on board. Despite the shakeout, Valente described the trend as “extremely bullish” for the crypto industry overall.
Exchanges Shut Down and Merge
Valente’s comments come as several crypto exchanges have already announced plans to close. Last week, BitMEX said it will shut down its exchange in September.
The decision followed a strategic review by owner HDR Global Trading. BitMEX had already sped up the delisting of trading pairs and derivative contracts, pointing to weak trading interest.
Days later, BitMart made a similar announcement. The exchange said it will end trading services on August 26 before fully winding down operations by January 2027.
BitMart said the decision came after reviewing its operating conditions, the current market environment, and its future strategy. Both exchanges framed the closures as business decisions rather than emergency measures.
Consolidation has also shown up in the form of acquisitions rather than closures. Earlier this month, Bybit launched a locally run exchange in Indonesia.
This followed Bybit’s acquisition of a majority stake in NOBI, a local digital asset firm. The move expands Bybit’s footprint in one of Asia’s largest crypto markets.
Together, these moves point to a shifting landscape where fewer platforms hold more of the market. Some exchanges are closing their doors, while others are buying their way into new regions.
