Coinbase Research Director: Specialized Blockchain Networks are Rapidly Emerging, Reshaping the Competitive Landscape of Crypto Infrastructure

BlockBeats News, December 29, Coinbase Investment Research Director David Duong wrote, "We believe that specialized blockchain networks are rapidly emerging (including L2, standalone L1, and application-specific chains), and are quickly reshaping the competitive landscape of crypto infrastructure. For example, the Arc platform built by Circle, designed specifically for institution-grade use cases centered around USDC, aims to be a compliant, optimal institutional infrastructure; while the Tempo network incubated by Stripe and Paradigm focuses on bridging institutional payment channels, aiming to tap into the vast scale of the cross-border payment and international trade market. Another example is the Canton Network, which is building a private, permissioned blockchain environment specifically designed to unlock the tens of trillions of dollars of institutional capital locked in asset tokenization and security exchanges."

This resulting infrastructure fragmentation is not accidental, but a strategic response at the institutional level to a core problem: large institutions are generally unwilling to outsource their core business logic to platforms controlled by competitors. The underlying logic is—strategic control. More and more companies are choosing to launch their own blockchains to maintain control over their data sovereignty, compliance environment, and the financial value accumulated through network effects. In the short term, this trend may further accelerate, with institutions continuing to launch dedicated chains for high-value, heavily regulated fund flows, prioritizing customized governance, fee structures, privacy controls, and compliance features, rather than using general-purpose shared infrastructure.

However, in the long run, we believe the endgame is not an indefinitely fragmented "chain of islands," but a network-of-networks architecture: these highly customized blockchains will achieve deep composability through an advanced interoperability layer, such as native cross-chain messaging, staking/re-staking-based shared security mechanisms, and privacy-preserving cross-chain bridges. The ultimate winners will be those projects that can balance vertical deep optimization with horizontal seamless connectivity—achieving cross-chain atomic-level settlements, unified liquidity pools, and the synchronized circulation of real-world assets (RWA); while laggards may be trapped in isolated ecosystems, gradually marginalized in a market environment that increasingly rewards compliance, liquidity, and institutional capital mobility."