As crypto evolves, one thing is clear: many more blockchains are going to launch. How these blockchains communicate with each other, and who gets to capture the value of that communication, is a fascinating question.
First, why will there be so many blockchains? The simple answer is that there’s an incentive. Crypto projects tend to have high valuations and are liquid, so people will want to get in on that opportunity. There are dozens of blockchains already, thousands of crypto tokens, and many more are coming.
Stepping back for a second for those who might not follow crypto closely, there are generally two types of crypto projects: there are blockchains themselves and then the applications built on top of them. Bitcoin, Ethereum, and Solana - along with others like Avalanche, Sui, Aptos, Arbitrum, and Optimism are examples of blockchains. These are the ledgers that applications build on top of.
Then, there are crypto apps like Aave, Uniswap, Jito, Jupiter, and countless others. These use the shared global state of a blockchain to allow users or businesses to do something. They are applications. While both blockchains and applications often have their own cryptocurrencies, the ways in which their value is determined can vary (and I will not cover here).
How can applications on different blockchains communicate? If you want to swap assets between blockchains, how do you do it without relying on a centralized company like Coinbase? Even though blockchains are global, they are siloed within their own ecosystems. This is why many companies are working to solve the issue of cross-blockchain communication.
The point of this post, which is really just me organizing my own thoughts, is that there are two key layers in cross-blockchain communication, but it is not clear yet where the value will ultimately go. These layers are the messaging layer and the intent layer.
Messaging focuses on how blockchains can actually talk to each other. Put simply, how can an action on one blockchain trigger an action on another? This is what LayerZero and Wormhole are working on. These are message-passing protocols where distributed validators run software across multiple blockchains to enable cross-chain actions.
These validators monitor different chains to verify that if I perform action A on chain 1, action B can take place on chain 2. In essence, these protocols are building the plumbing between isolated chains. They are core infrastructure.
Then there’s the intent layer. Intents are about fulfilling user needs as quickly and cheaply as possible. Rather than building core infrastructure, intent protocols let outside parties help users perform their actions faster and cheaper than what messaging layers can offer.
To make this more concrete, imagine you want to bridge USDC from Ethereum to Solana. Messaging protocols need to wait for blockchains to settle. If an Ethereum block occurs every 12 seconds, I cannot complete your transfer until those 12 seconds pass.
An intent protocol, however, involves a party like a filler or solver giving you USDC on Solana instantly. This way, you do not have to wait. The party fronts the asset and once the Ethereum block is confirmed, they are made whole.
So, messaging is core infrastructure while intents function more like businesses. Even though intents rely on messaging for confirmations, they operate differently.
But where does the value really accrue? That is the big question and I don’t have the answer.
All of these protocols either have tokens or will eventually. The idea is that their success drives value to those tokens. But does more value come from the infrastructure layer like messaging, or from the application layer like intents?
Typically, the closer you are to the end user, the more power you hold. This gives you more potential to capture value. If users are coming to your app, you control the funnel, which is highly valuable. If there are a dozen messaging protocols and only a few dominant intent apps, the app that controls the users controls the flow. It can simply pay for cheap messaging.
On the flip side, if there are a dozen intent apps competing but only one or two dominant messaging protocols, then perhaps value will be captured by the messaging infrastructure.
In the end, the question of where value accrues may come down to how competitive each market is and the power law dynamics that unfold.
While messaging protocols provide the core infrastructure, the winner-take-all nature of user-facing applications suggests the intent layer may have the edge in value capture. However, as the cross-chain ecosystem matures, we may see a symbiotic relationship where both layers find their own sustainable economic models.
