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| By Marija Matic |
The Thanksgiving lull is officially over. But instead of a quiet day, traders returning to their computers are facing a sea of red.
As of writing, the market is down nearly 7% in a single session.
And much of this downside pressure is thanks to the macro specter of Japan.
See, if the Bank of Japan raises rates later this month, the massive yen carry trade — the cheap liquidity engine that has quietly helped power risk assets like American stocks and Bitcoin (BTC, “A-”) — could start to unwind.
If this sounds familiar, that’s because a similar setup manifested last year. This same story caused a sharp drop in crypto … followed by a recovery and new highs.
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How things will play out this time remains to be seen, especially with the U.S. facing a potential rate cut decision next week.
But while the macro tourists panic-sell based on what central banks might do, I’ve shut out the near-term noise.
Instead, my focus has been on a more fundamental shift in the crypto market. One that’s been quietly reshaping our industry while prices were chopping.
The Era of the Fat Protocol
We are witnessing a structural migration of value.
It’s not the first time this has happened. And crypto enthusiasts who see the signs early can often beat the herd to the next big opportunity.
In the beginning, we had the Fat Protocol Thesis.
This was the gospel of 2016, penned by Union Square Ventures. And it dictated how we invested for years.
The logic was elegant in its simplicity: Unlike the web — where Google and Facebook (the applications) captured all the value and the underlying protocols (TCP/IP) captured none — crypto would flip the script.
The belief was that the base layer blockchains like Ethereum (ETH, “B+”) and Solana (SOL, “B-”) would be the value aggregators.
These blockchains were like cities, with dApps acting as shops renting space. If an application became successful, it just drove more demand for the underlying blockspace, driving up the price of the protocol token.
And if it underperformed? Well, the shops can be replaced, but the land was finite and valuable.
For a long time, this was true. Long-term investors bought the tokens for their favorite Layer-1 blockchain and HODLed … ignoring the tokens of the apps built on top.
And then came this latest cycle.
The Flip to Fat Apps
Over the past cycle, the shops have started to make more money than the landlord.
And with it, the narrative shifted to the Fat App Thesis.
Simply put, the average user doesn’t care about the careful city planning. They care about the service.
And so, we saw big changes in how dApps met demand.
- Uniswap (UNI, “B”), for example, started to process volumes that rivaled centralized exchanges.
- MakerDAO (MKR, “D”) began to print revenue that made L1 blockchains look like ghost towns.
The argument changed: Blockspace became cheap, abundant and interchangeable.
If switching from Ethereum to a different network is easy — thanks to EVMs and improved bridges — it loses its leverage based on scarcity.
The stickier part of the equation became the application — the brand, the user interface, the liquidity moat.
As the chains underneath them raced to the bottom for fees, application tokens could command a monetary premium because they owned the customer relationship.
The Arrival of The Fat Participation Thesis
This brings us to the newer thesis you are likely feeling, even if you haven't named it yet: The Fat Participation Thesis.
The market has realized that liquidity and attention are the scarcest resources of all. Which means the value isn't just in the road (protocol) or the car (app).
It also lies with the driver.
In this model, the protocol and the app are forced to strip their margins thin to compete for you.
They have to pay you to borrow your liquidity. They have to pay you to use their interface.
The real value no longer sits in the equity of the company or the treasury of the foundation.
It lies in the wallet of the active participant.
We’re seeing this via the explosion of "points" programs, airdrop farming as a profession and yield-bearing assets where the protocol effectively bribes you to show up.
The "Fat Wallet" thesis is a subset of this. It claims that, while the interface that aggregates your participation will be the new kingmaker, most of the economic surplus flows ultimately to the user.
In short, you are no longer just a customer.
In this new market, you are the mercenary liquidity that determines the winner. And you are being paid a premium for that power.
What Comes Next
If we look through the fog of today's crash and ask what 2026 and beyond holds, I believe we are barreling toward The Fat Agent Thesis.
Because something the Fat Participation Thesis doesn’t take into account is AI.
We are rapidly approaching a world where humans stop clicking buttons. Many of us won't be manually swapping tokens or managing yield positions. AI agents — autonomous software acting on our behalf — will execute these tasks.
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In this upcoming reality, the "user" isn't a human who’s concerned with a welcoming and easy UI. More likely, it’ll be a bot scanning the mempool and smart contracts for the best execution.
The Fat Agent Thesis suggests that the entities that control these agents will capture the next massive wave of value.
At which point, the value captures will move to the Intent Layer.
The Mechanism: Intent-Based Economics
To understand where the money goes, you have to follow the flow of a transaction in this new world.
Right now, you buy a coin, you have to go to the exchange, find a token, check the slippage and sign a transaction.
In the Agent world, you simply express an intent: "I want to earn 5% yield on my USDC with low risk."
That’s it. You are done.
Then, a swarm of Solvers (specialized AI agents) will compete to fulfill that request.
One agent might route your funds to Aave (AAVE, “B-”) on Arbitrum (ARB, “C+”).
Another might find a better rate on Solana.
A third might bridge it to Base.
The winner is the agent that can solve your problem most efficiently.
The value capture moves to the Intent Layer, which acts as the economic nexus. Here, the user simply articulates their desire and leaves all the operational complexity to the system.
This declared intent will spark fierce competition among AI Solvers who will then race to find the optimal path — bridging funds and interacting with various protocols across different chains.
Because the winning solver directs the entire transaction flow, value ultimately settles with the solver and the platforms that build the best agents.
Expansion, Not the End
So, as you watch the charts bleed red today, remember that this volatility is just the noise of the macro world doing what it always does.
The Japan fears and interest rate panics are temporary storms that the market will recover from.
It always does
But beneath that daily chop, the tectonic plates of the industry are shifting. And as the green candles return, you’ll want to keep an eye on where the new leverage lies.
To be clear, this doesn’t mean the death of the old ways. The Fat Protocols and Fat Apps are still the giants upon which this industry rests. And they will likely remain the safest harbors for capital.
But the frontier of alpha is moving.
The "Fat Participation" and upcoming "Fat Agent" theses represent an expansion of the playbook. And that’s where the next explosive growth will migrate — to the participants and agents who empower the protocols.
Which means the table is getting bigger. And there are now more ways to grab your seat than ever before.
It’s up to you to find the approach that works best for you.
Best,
Marija Matić
P.S. Speaking of more seats at the table, my colleague Michael Robinson has an approach to help you invest in crypto …
Without ever buying a single coin.
If learning this new market has kept you from getting crypto exposure, I encourage you to learn more about Michael’s strategy here.
