Important points
- Ethereum and Solana are expected to consolidate their position as the leading blockchain platforms by 2026, targeting different markets.
- The dominance of Ethereum and Solana will make it difficult for new smart contract chains to gain traction.
- By 2025, new general-purpose blockchain platforms will struggle to compete with Ethereum and Solana due to established network effects.
- Solana is becoming increasingly popular among developers and consumers, marking a shift in the blockchain space.
- Improvements in indicators such as TVL and institutional investor interest could lead to a positive shift in Ethereum sentiment.
- The Solana Foundation’s proactive approach to supporting construction contractors and training institutions is a key element to the growth of its ecosystem.
- The value of a blockchain token does not always reflect the value created by the chain itself.
- The market has yet to decide on a valuation for Ethereum, and estimates vary widely.
- We expect builders, activity, liquidity, and users to converge on Ethereum and Solana, driving asset performance.
- Robinhood could surpass Coinbase by 2026 due to its rapid product development and market performance.
- Privacy-protecting KYC technology is expected to become standard across a variety of applications, increasing data security.
- Centralized exchanges may face challenges as wallets capture more value and offer better fiat adoption.
Guest introduction
Arnav Pagidyala is a partner at Bankless Ventures, an early-stage Web3 venture fund that backs zero-to-one companies across DeFi, consumer, and fintech. He previously spent three years at HashKey Capital, one of Asia’s largest cryptocurrency funds, investing in on-chain commerce, smart contract compliance, and MEV solutions.
The future of Ethereum and Solana
- “The duopoly of Ethereum and Solana will become evident in 2026, with each targeting different markets.” – Arnab Pagidiyala
- Ethereum is positioned as a slow, risk-averse DeFi chain for real-world asset money markets.
- Solana is moving towards the vision of a decentralized Nasdaq focused on consumer cryptocurrencies.
- “This duopoly will become entrenched and will make it very difficult for new smart contract chains to enter the market.” – Arnab Pagidyala
- By 2025, it will be difficult for new general purpose chains to disrupt Ethereum and Solana.
- Application-specific chains have a hard time justifying their existence due to the strong network effects of existing chains.
- Solana is becoming the preferred platform for founders and consumers in the blockchain space.
- Ethereum sentiment is expected to undergo a major reversal due to improvements in various indicators.
Solana ecosystem and market positioning
- The Solana Foundation takes a hands-on approach to training institutions and supporting contractors.
- “One of them is something like the Solana Foundation, which I would say is very different from the Ethereum Foundation.” – Arnab Pagidyala
- Solana’s proactive strategy is a major contributor to the ecosystem’s success.
- “The value of a blockchain token does not necessarily correlate to the value created by the chain itself.” – Arnab Pagidyala
- Solana’s market position is strengthened by its appeal to developers and consumers.
- The Foundation’s operational strategy is a key element of Solana’s resilience and growth.
- Solana faces the unique challenges of an emerging chain, but is actively working to maintain its position.
- “They will definitely have to work hard to maintain their position… It will definitely be a very competitive battle.” – Arnab Pagidyala
Ethereum’s evolving market dynamics
- The market has yet to figure out how to value Ethereum, and estimates vary widely.
- “The market hasn’t really figured this out yet…some say it should be worth something like $80, others say it should be worth something like $30,000.” – Arnab Pagidyala
- It is expected that builders, activity, liquidity, and users will converge on Ethereum, leading to high asset performance.
- Although Ethereum and Solana face structural challenges, network effects remain strong.
- “Ethereum still has shortcomings… cracks are starting to appear in the microstructure of Ethereum and Solana.” – Arnab Pagidyala
- There is a bimonopolistic competition for store of value between Bitcoin and Ethereum.
- Ethereum may become the standard store of value in the future.
- “Is it possible that at some point in the future it will become a standard store of value? I think it would be naive to think potentially not.” – Arnab Pagidyala
Competitive environment for Robinhood and Coinbase
- Robinhood could gain the lead over Coinbase by 2026 due to its rapid product development.
- “It would probably be Robinhood… They shipped 11 new products with a run rate of over $100 million.” – Arnab Pagidiyala
- Robinhood’s intentional product design strategy may enhance user engagement.
- “I think they are very intentional with their product design… which I think is actually very smart.” – Arnab Pagidiyala
- Robinhood’s user experience is excellent and especially appealing to younger generations.
- “The UX is very good and it is very easy to log in to Robinhood with Face ID.” – Arnab Pagidyala
- Coinbase may abandon the content coin narrative and move towards becoming a bank alternative.
- Coinbase may develop two separate apps to better realize its banking ambitions.
The rise of privacy-preserving technology
- Privacy-protecting KYC technology prevents data leaks by not requiring trading partners to store sensitive information.
- “The great thing about a lot of the technology we have in cryptocurrencies is that you can do KYC without the counterparty actually storing that data locally.” – Arnab Pagidyala
- KYC to protect privacy will become the standard for a variety of emerging applications beyond cryptocurrencies.
- “I think this privacy-protecting KYC will become the standard for many emerging applications.” – Arnab Pagidiyala
- Projects focused on privacy in cryptocurrencies are still in their early stages and have not received much attention.
- “Believe it or not, I think it’s still a little early when it comes to privacy… New users who have reached the limits of cryptocurrencies are not as concerned about privacy.” – Arnab Pagidyala
- Wallets are gaining more and more value and have the potential to disrupt centralized exchanges by providing better fiat currency adoption.
- “I think centralized exchanges…face a lot of headwinds from wallets…if they had better fiat currencies…” – Arnab Pagidyala
Impact of decentralized finance on traditional systems
- Once the entire capital stack moves on-chain, centralized exchanges will lose power.
- “I believe that centralized exchanges will run out of power. That is a very, very positive thing for the sector.” – Arnab Pagidyala
- As centralized exchanges face viability issues, they will list quality assets on more favorable terms.
- “Centralized exchanges are encouraged to list quality assets as they also have viability issues.” – Arnab Pagidyala
- Institutions may consider building established chains due to network effects.
- “My intuition is that this year many of these institutions will understand the importance of building chains with deep network effects.” – Arnab Pagidyala
- Traditional financial institutions prefer a chain they can control, but are also exploring decentralized options.
- “They seem to be trying everything… They prefer chains where they have more control.” – Arnab Pagidyala
The evolving landscape of initial coin offerings (ICOs)
- ICOs are seen as a way to engage the community and create great value.
- “There are several reasons why I’m incredibly bullish on ICOs. It’s just about getting the community involved.” – Arnab Pagidyala
- As long as ICO platforms are selective about quality projects, ICOs will thrive in 2026 and beyond.
- “As long as these platforms continue to curate better projects and perform well…I’m very bullish on ICOs in 2026 and beyond.” – Arnab Pagidyala
- The success of an ICO depends on the platform’s ability to select successful projects.
- Community engagement is a key element for an ICO’s success.
- ICO platforms play a key role in the success of a project by ensuring quality curation.
- The future of ICOs looks promising if platforms maintain high standards in project selection.
Morpho’s strategic advantages in decentralized finance
- Morpho has a clean risk isolation architecture that is attractive to organizations.
- “Morpho has very clear risk segregation…This very clear risk segregation and management makes it attractive to financial institutions.” – Arnab Pagidiyala
- Morpho’s share of total active lending is expected to increase from 10% to 25-30% this year.
- “My prediction is that we currently have 10% of the total active loans issued and will probably increase to 25-30% this year.” – Arnab Pagidyala
- Morpho’s market structure has been simplified into five key components, making it attractive to institutions.
- “Every market is made up of just five elements. It’s very simple and clean, which is exactly what financial institutions want.” – Arnab Pagidyala
- Aave v4 is evolving towards a similar structure to Morpho, marking a change in the DeFi landscape.
- “Aave v four goes even further towards this Morpho-esque architecture.” – Arnab Pagidiyala
The role of social media in the cryptocurrency space
- Social media companies will inevitably enter the crypto space, especially with the integration of stablecoins.
- “If X enters the space is definitely a matter of when and not.” – Arnab Pagidyala
- The trend of integrating decentralized finance protocols into existing social media platforms could redefine the cryptocurrency wallet landscape.
- “We see potential with something like X entering the fat wallet space.” – Arnab Pagidyala
- The technical barriers to incorporating cryptocurrencies are decreasing, allowing even small teams to create high-quality products.
- “It may not have been possible before…smart contract auditors are surprised by how effective Opus 4.5 is.” – Arnab Pagidyala
- Social media platforms may leverage DeFi to enhance their service offerings and user engagement.
- The convergence of social media and finance can have a significant impact on market competition.
The future of cryptocurrencies as infrastructure
- Cryptocurrencies will move from niche online communities to ubiquitous infrastructure.
- “I believe this will be the defining trend of 2026… Cryptocurrency will become a ubiquitous infrastructure.” – Arnab Pagidyala
- The cryptocurrency community is tired of scams and is moving towards a more builder-focused approach.
- “People are just tired of the scams that rugs cause…everyone is more keen to move in the direction of a more suitable builder.” – Arnab Pagidyala
- The role of cryptocurrencies in society is expected to evolve towards mainstream adoption.
- The focus on building legitimate and constructive projects reflects an important shift in sentiment within the community.
- The shift to a builder-focused approach is being driven by a desire for more legitimate projects.
- The future of cryptocurrencies depends on their ability to integrate with traditional systems and provide value beyond speculation.
