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From DeFi Apps to DeFi Primitives

Feb 24, 2024

Presentation given at ETHDenver '24 in Denver. Slides viewable below or here.


In crypto, the deeper a protocol sinks in the stack, the deeper its moat can be and hence the more valuable it generally is. An LP management protocol is less valuable than the underlying DEX which is less valuable than the blockchain it is built on (empirically, at least so far).

As such, many successful DeFi protocols aim to evolve from apps to primitives. Becoming more akin to 'DeFi Infra' in their specific vertical and allowing for different implementations and apps to be built on top.

This presentation covers the why and the how behind this transition, with three main sections:

  • Moat building in DeFi

  • Value capture

  • Case studies (or, examples of 'sinking in the stack')

    • Uniswap, Morpho, dYdX