Proxy Ecosystem: A New Era of Web3 Transformation

Compiled by: Block unicorn

Remember the L2 hype cycle in 2022-2023?

The best strategy at that time was to accumulate leading decentralized exchanges (DEXs), top money markets, Solidly forks, LSTs, yield optimizers, and so on. Everyone was chasing token issuance, mining airdrops, or putting total value locked (TVL) into L2 projects like Blast to earn points.

It was chaotic, but it worked (at least for a few months). Now, similar energy is back - but this time, the rules have completely changed.

Proxy ecosystems are reshaping everything we thought we knew about the market, and their structure is completely different from what we have seen before.

1. No VC dominance

In the L2 era, token distribution always has the same formula:

• 15-30% is allocated to the team.

• 10-30% is allocated to venture capital (VC) and KOL.

• The rest is used for token issuance or incentives.

Not so here. In the proxy ecosystem, the tokens are 100% owned by the community. The team launches the proxy token, perhaps keeping 5% for incentives, and then the rest is handled by the market.

What does this mean?

Everyone has an equal opportunity to participate in the purchase. There is no hidden worry of VC unlocking or insider selling. If you want exposure, you take the same market risk as everyone else.

So, what about OTC trading for KOLs?

Some projects do offer discounted OTC trading, but they are usually:

• Strictly limited in size.

• Limited to partners who are aligned with the ecosystem, such as DAOs or opinion leaders who actively support the ecosystem.

This is not a "VC pumps up, retail investors get dumped" model. This is a fairer and more streamlined system that keeps power in the hands of the community.

2. No Forks

At least not in Defi, where there have been dozens of forks of everything from Uniswap to Liquity, and there has been almost no innovation.

Here, it’s all about brand new innovation. Rather than cloning existing projects, developers are launching entirely new agents and use cases at a pace that’s hard to keep up with.

Why? Because AI applications move faster:

• No months of auditing required.

• Most agents take weeks, not months, to launch.

• There’s a lot of energy, experimentation, and creativity in this space.

Every week there’s something new and exciting. As AI technology evolves, so too does the Web3 AI agent narrative.

3. A whole new user acquisition channel

In traditional DeFi, users must:

• Find the project’s website.

• Spend time learning about the product.

• Potentially interact with it.

Agents flip that script. They put the product directly in front of the user.

Take @aixbt_agent as an example.

• It provides alpha in real time directly on CT.

• Users see the value immediately, become curious, and learn more.

• Eventually, they earn tokens to fully unlock the product.

This channel (participate first, then trade) is more efficient. As on-chain trading agents and DeFi agents gain traction, this model will become mainstream in 2025.

4. A Curated Ecosystem

Instead of thousands of fragmented L2s and dApps, we now have tightly connected ecosystems such as:

• @virtuals_io (Base)

• @ai16zdao (Solana)

• @daosdotworld (Base)

• @daosdotfun (Solana)

What’s different about this is that developers aren’t attracted by grants or token issuances, they’re joining naturally because:

• @virtuals_io (Base)

• @ai16zdao (Solana)

• @daosdotworld (Base)

• @daosdotfun (Solana)

This is different from the past in that developers aren’t attracted by grants or token issuances, they’re joining naturally because: class=" list-paddingleft-2">

This is what happens when you combine a fair launch with constant innovation. Developers, investors, and communities working together to drive growth.

How to position yourself in this proxy cycle

This feels like the early days of L1 — except it’s moving much faster. Many L1s peaked at $100B+ valuations back in 2020-2021. The same potential exists here.

If you want to find your place among them, here are some of the agents L1 you can look at:

• $VIRTUAL

• $AI16Z

• $ZEREBRO

• $GRIFFAIN

• $BULLY

• $ARC

And don’t just chase the hot projects of the moment. Look for:

• Projects that are undervalued, projects that are outside the scope of the current narrative.

• Teams that can deliver fast, tell a great story, and understand how to build user mind share.

Welcome to the new era

The proxy ecosystem is not just a new L1, it’s a completely different market structure - faster, leaner, and more community-driven than anything we’ve seen before.

We are entering a cycle that could reshape how Web3 innovation works, and the journey to $100B+ valuations has just begun.

Join us my friends, we’re in for an amazing ride!