Yes, obviously we need more apps. But there is a faster and easier parallel path that no one is talking about:

10% of the 100M monthly CEX traders will trade onchain as CEXs suddenly "list" every DEX-based token.

This was not possible before. Each token had to be reviewed and approved by a CEX's legal team, and very few tokens got approved. Liquidity for the token needed to be spun up on the CEX, and sometimes custody solutions for a new chain needed to be created.

But now - thanks to passkey-based web wallets like Coinbase Smart Wallet that 10x internet UX - it is not just possible but very compelling to CEXs.

In the same UI where you buy CEX tokens, you’ll be able to buy any DEX-based token. Exchanges will use DEX liquidity instead of spinning up their own. Users will spend from their CEX balance via a “magic spend” feature (no need to transfer balances to an onchain address first), and the purchased token will land in their onchain web wallet address.

All the token details pages that CEXs already have for every onchain token will go from dead ends to immediate pathways onchain.

This path requires no behavior change. It doesn’t require you to believe there’s a wider audience for minting, questing, etc - just that 10% of the 100M CEX traders will trade onchain to access more tokens without a new app download, backup phrase, funding a new address, or learning a new UI.

Coinbase will lead the way here, and most other exchanges will follow. They have every incentive to do so - it’s a large new revenue source:

• Can now “list” every token and capture swap fees (like MetaMask's swap revenue).

• Don’t need to build up their own liquidity (just use aggregated DEX liquidity).

• Can "list" tokens with much lower legal risk (see a judge’s recent ruling that Coinbase Wallet is not a broker).

• Can drive users to their own L2s (Base is making $60M / year).

These 10M onchain transacting users will have funded addresses powered by passkey-based web wallets that can be accessed anywhere on the internet outside of the originating CEX - no dapp browsers, WalletConnect, or browser extensions. 

This is a highly attractive user base for high caliber builders, and will accelerate our jump from 10M to 100M as more apps come onchain.

If you work at a CEX and want to discuss how to pull off this large new revenue source, please reach out: kyle@daylight.xyz.