The Economics of Blockchain is the Avalanche Foundation’s public research series and the ongoing home for our economic research agenda. The agenda is organised around a sequence: measure the value the @avax ecosystem creates, capture that value at the protocol level, and determine how it is distributed across the network. Each piece published in the series connects explicitly to that agenda: advancing the central hypothesis, answering one of the research questions, or documenting what the evidence shows and where it points next. Updates, findings and new research will be shared through the series as the work develops 🔺

In a year when global football brought millions of fans together, ticketing is a clear example of blockchain solving a real-world problem: verifiable ownership and authenticity, built into everyday fan experiences. Activity of this kind, grounded in real demand, is part of what our research agenda sets out to measure 🔺

New research from @CharlesSchwab highlights the quality of activity on Avalanche, from real-world assets to stablecoins, lending, and asset management. Understanding how that activity creates lasting value for the network is at the heart of our research agenda, and why we created Gross Chain Product to measure that value. The work continues 🔺

JUST IN: Charles Schwab identifies Avalanche as a leader in RWAs and institutional use cases. New research from @CharlesSchwab points to custom L1s and high-utility financial activity as key differentiators for the network.

Fan reward infrastructure continues to be built on Avalanche. Activity of this kind is what our research agenda aims to understand: how value is generated and flows through the network. We look forward to following Marquette University’s progress onchain, and on the field 🔺

Very cool research from the Grayscale team: Bitcoin’s one-year realized volatility is 43%, down from a 10-year average of 64% and 81% five years ago. That’s now lower than 19% of S&P 500 constituents.

📣 Avalanche Q3 Ecosystem Call What to expect: Big tokenization news, growing institutional adoption, summit NYC recap, and more wins across the ecosystem. Last quarter gave us a lot to talk about, so let’s talk about it. Join the Quarterly Ecosystem Call tomorrow at 1pm ET for the highlights and a look at what’s upcoming. Watch live on X tomorrow and RSVP below:

Moving traditional capital markets onchain isn’t only about efficiency or 24/7 trading. It goes beyond that. The part I find particularly interesting is access: opening up markets that have been out of reach for much of the world. That’s what we’re building toward on Avalanche 🔺 Enjoyed joining the stream, @PharaohExchange.

Avalanche’s presence in UAE public infrastructure keeps growing. Last month, the UAE’s national digital identity system infrastructure launched on Avalanche, serving more than 12 million people. Now, the Dubai International Financial Centre (DIFC) Courts have introduced a blockchain-based verification system for court orders and hearing records, built on the Avalanche C-Chain. Together, these two initiatives point to a pattern worth watching: government institutions in the UAE exploring what Avalanche can offer. This is the kind of real-world adoption we’re delighted to see, and we look forward to following the region’s progress on Avalanche 🔺

Hello Team1 Japan 🇯🇵 Avalanche is winning in Japan with some of the deepest institutional adoption anywhere, across tokenized securities, payments infrastructure and enterprise systems. We are here to double down on those efforts and empower the community to build the network. Prior to launching an official Team1 chapter, in Japan we have been actively growing the community and onboarding builders to Avalanche. ・30 events hosted across Tokyo, Osaka, Nagoya, and Fukuoka ・1200 attendees ・18 editions of Avalanche Gourmet Night, our monthly flagship ・4 institutional-focused events Our mission is to build a Japanese builder community that matches the scale of Japan's institutional adoption, and to support growth across consumer, stablecoins, payments and many other verticals. That means real programs, real pathways, and real outcomes. While many markets are still running pilots, Japanese institutions are running live systems. Billions in tokenized real estate and corporate bonds now settle on Avalanche. One of the country's largest payment processors has built on AvaCloud. Japan's biggest banks are exploring tokenized government bonds with Avalanche infrastructure. Team1 Japan is here to build on those efforts and empower the local community to grow Avalanche too. Institutions chose Avalanche. Now it's the builders' turn. ヤバランチ🔺 Join our telegram community and Luma below to connect with the community 👇

The Avalanche Foundation is delighted to see Team1’s progress continuing to scale around the world. @Team1JP marks a milestone on two fronts: Team1’s tenth chapter launch globally, and a region where Avalanche continues to build real momentum and a genuine community. Every new chapter adds value to the ecosystem, and our research agenda is working to measure and support this activity 🔺

Validator economics is one of the central questions in our economics research agenda. According to @eric_lu_sc, the Avalanche Foundation’s Lead Economist, the core question is a two-sided market problem: “how much should validators get paid, and who should pay.” Watch the clip below as he digs into the thinking.

Recently, @frostledger and I joined the Layer One podcast to discuss the Foundation's research agenda. One interesting topic that came up: Validator pay is a genuinely hard problem, and most chains haven't actually solved it. The real question is a two-sided market problem: what are network users actually willing to pay for validation, and what's the minimum validators need to be willing to provide it? We need some kind of equilibrium mechanism to find that price. There's a second layer to this too. Validation is a public good, validators don't fully capture the benefit of the security they provide, everyone on the network does. Basic economic theory says that means it'll be undersupplied without some kind of subsidy. Still working through the answer, but this is exactly the kind of question our research agenda is built to take on. Not just for Avalanche, probably every proof-of-stake chain out there.

Fundamentals are increasingly what’s making the difference, and that’s exactly the problem our research agenda is working to solve. We’re building the mechanisms to measure and capture ecosystem value, and distribute it back to strengthen the network. The work at the Foundation is well underway here 🔺

Here are a few of my takeaways from Token2049 & the Digital Asset Summit Asia. - Fundamentals is an important return driver now In a panel discussion with @santiagoroel, @HadickM and @sethginns, they pointed to a "flight to quality": tokens with stronger revenue developments are seeing those developments accrue to the token itself. This means certain tokens start to look more like equities. Therefore, institutional analysts can now do fundamental analysis on these, which gives investors more clarity if they choose to put the tokens in their portfolio. - Tokens with better fundamentals are outperforming The same panel noted that, unlike the previous cycle where top performers tended to be newly issued tokens, legacy tokens with real revenue fundamentals are outperforming the rest this time. Research presented in a separate keynote backed this more rigorously: looking across a large panel of tokens, it found that those with higher distribution yield (mostly through buyback-and-burn) outperform Bitcoin this cycle. - What this could mean for cycles going forward Together, these observations suggest the old "four-year cycle" heuristic may be breaking down. Coming out of this cycle, we may see less synchronised movement across tokens generally, with the strength of underlying fundamentals mattering more than it has before. - App-Layer vs. L1: Not the same problem Some of the clearest examples of mature capture-and-distribution models - Aave, Hyperliquid - have been running theirs for a long time by crypto standards, and are arguably the closest comparison to equity-style valuation in this space today. General-purpose L1s like Avalanche aren't necessarily behind here, though, the capture and distribution question for us is more nuanced than it is for a single application, and how the market responds to that complexity is still something worth watching closely. - The gap nobody's solved yet The same question came up in a separate panel with @zeroxkyle, @Tradermayne, @dennis_qian and @andyyy. Their view: revenue remains the key driver this cycle, with Hyperliquid as the reference point - but only for app-layer tokens (Hyperliquid, Aave, Uniswap, Rollbit), not general-purpose L1s. They didn't explain how L1 tokens should be valued instead, beyond assuming higher app revenue should naturally demand higher L1 security, and therefore higher L1 value. Most L1 tokens aren't valued by revenue today because they don't capture much of it, and "should" doesn't happen automatically, it needs an explicit mechanism connecting app revenue to L1 value. That's exactly what our research agenda is working to build: a clear link analysts can actually examine, the same way they already do for app-layer tokens. - What this means for Avalanche This is exactly the gap our research agenda exists to bridge, strengthening Avalanche's fundamentals and improving the value accrual process. It matters because, as the panels this week suggested, markets may increasingly reward with a real, explicit link between the value their ecosystem creates and the value that flows back to the token. Measure, capture, distribute isn't just a framework we talk about, it's the kind of mechanism-building we believe this problem requires. That said, this is quickly becoming consensus across the industry, not just us: competition is intensifying, and we need to stay strategic about where we focus, balancing impact, effort, and timing. The work at the Foundation is well underway, and we look forward to sharing more as the work progresses 🔺

The demand for 24/7 trading is real. The IMF is right. Markets don’t wait for traditional hours anymore, and more than half of tokenized equity trading already happens outside them. Avalanche was the number one blockchain by tokenized stock growth in September 2026, according to Token Terminal. @PharaohExchange is already building on that foundation: 24/7 trading of tokenized U.S. stocks on a decentralized exchange built natively on Avalanche. This is the kind of infrastructure that’s becoming the backbone of how markets actually work 🔺