Been thinking about the long term durability and overlap in trading apps (prediction markets, exchanges) neobanks, and online gambling (igaming companies like draftkings, stake, fanduel, bet360 etc) 1. The more a consumer app is positioned as an investing app but is actually gambling under the hood, the less defensibility it will have long term 2. These platforms can only continue to grow if users actually make money -or- they enter new markets -or- they come up with novel ways to make the gambling fun such as live betting, new casino games, etc (which also requires positioning more like a betting platform than an investment platform) 3. I can’t find real data to support this, but intuitively believe prosumer and sophisticated traders (those who trade as a living, use programmatic methods, trade with size) are not growing. I know for a fact though, the TAM especially in crypto is small. Every exchange is going after the same whales 4. There’s a lot to learn from the igaming industry, such as looking at how the draftkings and fanduels have grown YoY when it is validated in their business model that players must lose money over time - these businesses have targets on RTP %s to bake out their margins 5. It’s also important to consider how igaming has consolidated in the last few years, through m&as to mainly access new markets with new licenses - this is very similar to what we see mature crypto companies doing too (Kraken, Coinbase etc). It also reminds me of how crypto neobanks seem to be accruing to a few: Payy shut down their card, i recently recalled Holyheld and don’t see any recent posts, and i’ve seen other teams contracting I respect fomo, polymarket, and kalshi’s accelerated growth - Fomo crushed it on user acquisition outside of crypto twitter. I think for them to maintain defensibility, they not only have to solve the hard problem of limit orders crosschain, but need to add actual saving and investing features to keep capital sticky (earn, dca, conservative assets). As is right now, their current user base is losing money when coming in on an ig ad on how easy it is to make money copying others.. this isn’t sustainable - Polymarket and kalshi are not just competing with each other anymore, but they compete with the Robinhood’s, Coinbase’s, Revolut’s Moomoo’s as well as the Stake’s, Fanduel’s, Bet360’s. The difference is the iGaming companies position as betting and gambling apps, so people use them as a choice knowing they are gambling and do it for fun. I also intuitively believe with where AI and agents are heading, consumer behavior will shift to a future where less frontends and screens are used All this means there is a convergence between exchanges + trading + gambling + banking apps Power laws are real and the biggest players are consolidating and overlapping. Investing apps will add banking, trading, payment and gambling features in one place to retain capital and users We’re already seeing it now. The winners will be those that can ship the fastest, have an edge in compliance to capture new markets, and have enough capital to subsidize incentives for growth and talent density