ARK Researcher: Ethereum Built the Most Successful L2 System but Forgot to Collect Rent

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ARK researcher Lorenzo Valente compared Ethereum, Solana, and Hyperliquid to McDonald’s, Chipotle, and In-N-Out, highlighting their distinct Layer 1 business models and value capture mechanisms. He noted that Ethereum’s Layer 2 expansion lacks sufficient settlement layer fees, while Solana retains more value through direct operations. Hyperliquid’s model relies on vertical integration and HYPE buybacks but faces a poor risk-to-reward ratio due to concentrated revenue and product sources. The structure of each chain influences how they manage support and resistance in market dynamics.

Huoxing Finance reports that ARK Invest researcher Lorenzo Valente compared Ethereum, Solana, and Hyperliquid to McDonald’s, Chipotle, and In-N-Out, respectively, arguing that they are not different versions of the same L1 business model, but rather possess entirely distinct value capture structures. Valente believes Ethereum resembles a franchise model, expanding through L2s but charging too little for its settlement layer—he even calls it the most successful franchise system in crypto, yet forgot to send the bill. Solana resembles a company-owned model, retaining more value within its own system through transaction fees, priority fees, and MEV. Hyperliquid, by contrast, relies on highly vertical integration, no VC backing, and HYPE fee buybacks, featuring the shortest value capture chain—but faces risks from a more concentrated product, team, and revenue stream.

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