When the entire crypto industry is building casinos, who is still committed to long-termism? a16z's two pieces of advice for builders

2026年 the crypto industry is approaching a structural turning point. a16z crypto recently highlighted two crucial reminders for entrepreneurs, presented by investment partner Arianna Simpson and Chief Legal Officer Miles Jennings: Over-trading platformization is eroding the industry’s moat, while regulatory clarity will become the true starting point for the maturity of decentralized networks.

When all companies become trading platforms, who is still building products?

In recent years, a clear trend has been spreading within the crypto industry: apart from stablecoins and a few core infrastructure projects, almost all revenue-generating projects eventually shift toward trading. Whether it’s built-in DEX, perpetual contracts, tokenized airdrops, or gamified prediction markets. a16z crypto partner Arianna Simpson points out that this may seem like a shortcut to product-market fit (PMF), but in reality, it could be a trap for long-term competitiveness.

If every crypto company ultimately becomes a trading platform, the entire industry will face serious mindshare cannibalization: a large number of homogeneous products competing for the same trading users, ultimately leaving only a few winners, while the rest are drained of liquidity and attention over time.

Simpson describes this as a classic marshmallow test. In the short term, trading and speculation can indeed generate immediate revenue and activity; but sacrificing product strategy for these short-term metrics often results in missing the opportunity to build truly defensible and sustainable business models. In the crypto industry, this temptation is especially strong. Token prices, airdrop expectations, and speculative sentiment can easily lead entrepreneurs down the path of maximizing immediate feedback rather than maximizing user value.

Simpson emphasizes that trading itself is not wrong; it is a necessary market function. But it should not be the endpoint for all projects. In the long run, those that truly endure are often the teams that prioritize product-market fit before focusing on trading.

Regulation is no longer just a risk for the crypto industry; it is reshaping its structure

If the first problem stems from internal market incentives being misaligned, the second comes from external factors: long-term legal uncertainty has distorted the entire evolution path of the crypto industry. Miles Jennings, Chief Legal Officer of a16z crypto, points out that over the past decade, US regulation of blockchain and tokens has essentially been applying corporate law to decentralized networks.

The expansion of securities laws and the prevalence of selective enforcement have led entrepreneurs to focus less on product design and more on how to survive by designing their frameworks. As a result, a series of abnormal phenomena have emerged in the industry:

Projects are advised to avoid transparency

Token distribution becomes a legal tactic

Governance turns into a formality

Organizational structures are designed around legal risks rather than efficiency

Tokens are designed to have “no economic value” to avoid being classified as securities

Ironically, projects operating in gray areas often move faster than compliant builders. But this situation is changing. Jennings notes that the US Congress is closer than ever to passing the “Crypto Market Structure Act” this year, which will be a more impactful step following the GENIUS stablecoin bill. If passed, it will establish clear institutional pathways for token issuance, network decentralization, fundraising, and governance, replacing the previous law enforcement roulette with predictable processes.

For the crypto networks, this is not just about compliance but returning to the fundamental premise of the internet: enabling blockchains to operate truly in an “open, autonomous, composable, neutral, decentralized” manner, rather than being twisted to evade regulation.

This article, “When the crypto industry is all building casinos, who is still practicing long-termism? a16z’s two suggestions for builders,” originally appeared on Chain News ABMedia.