a16z Crypto Partner Says Capital Flow Is the Moat, Crypto Project Entrepreneurs Should Seize the Opportunity

June 15 News, a16z Crypto Operating Partner Jason Rosenthal posted on the X platform, stating the core business view that capital flow is the moat.

Rosenthal said that the most successful companies in history tend to place themselves within "capital flow," and cryptocurrency is the first modern technology born for this purpose. If startups do not design their products and business models based on these principles, they will miss out on opportunities.

He also pointed out that thanks to stablecoins, capital and value can achieve global settlement at internet speed, support 24/7 continuous operation, and have the advantage of end-to-end programmability;

Therefore, he encourages entrepreneurs to build their business architecture around capital flow, noting that crypto entrepreneurs inherently have network effect advantages and should not spend years building network effects on old infrastructure like traditional companies.

He even cited Visa (which processed $15.7 trillion in FY2024 with a net income of $35.9 billion) and Jane Street (with annual net trading revenue of $20.5 billion, surpassing Citibank or Bank of America) as examples, emphasizing that "capital flow + network effects" is one of the most enduring business structures.

In his view, every fee in traditional financial services contains opportunities for crypto projects, such as Visa/Mastercard’s 2-3% interchange fees, remittance channels’ 6-9% fees, etc., all of which provide huge market space for crypto entrepreneurs.

Rosenthal finally posed three questions to founders: 1) Are you currently within the capital flow? 2) When your product’s active value increases tenfold, does your revenue grow in tandem? 3) In your target market, which customer groups can bring the highest profit margins?

In summary, Rosenthal believes that crypto entrepreneurs do not need to reinvent the wheel on old infrastructure but should leverage the natural network effect advantages, deeply embed their business in capital flow, and when product value grows, revenue should grow in sync. This is true business model innovation.

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