Crypto Industry Consolidation Deepens: Capital Concentration Kills Weaker Projects
The crypto industry is undergoing a deepening consolidation phase, with capital allocation tightening sharply and projects without product-market fit facing no lifeline. According to ARK Invest researcher Lorenzo Valente, this cycle feels different from previous bear markets.
In the current market, revenue concentration across key sectors is high. For example, Hyperliquid and PumpFun alone account for 67% of total application revenue, while the top three projects including Ethena make up nearly 80%. This level of concentration leaves little room for smaller projects to compete on economics alone.
The consolidation dynamic is expected to drive a wave of activity in the coming months. Valente forecasts rising M&A deals, more bankruptcy filings, project shutdowns, and talent acquisition activity as stronger players absorb distressed or undercapitalized rivals. This trend suggests that capital gets freed and redeployed toward projects with actual product-market fit.