It’s standard procedure that cryptocurrency projects come and go at a dizzying rate, as they often serve no real immediate purpose. However, some protocols have managed to establish themselves as revenue-generating powerhouses, demonstrating real-world utility, user adoption, and sustainable profits. 

Traditional Finance firms are chomping at the bits for the newly-approved Ethereum spot ETF to start trading. The Bitcoin ETF serves as a safe haven asset hedge, ETH is an asset class that Wall Street can engage with. TradFi firms can use metrics like new users, fees, revenue and total value locked (TVL) to measure network effect. With Ethereum clearing the way, other chains and protocols can eventually follow in its wake. 

We’ve used a recent study by Onchain Times and Token Terminal data to do a deep analysis of the top ten money spinners in crypto in mid-2024, comparing their business models, revenue streams, and key performance metrics.

1. Ethereum: The Undisputed Leader

Ethereum remains the giant of the crypto industry, generating an impressive $1.42 billion in revenue year-to-date (YTD). As the foundation for much of the decentralized finance (DeFi) ecosystem, Ethereum’s success stems from its widespread adoption and the high demand for block space on its network, as well as recent upgrades like the Merge and Proto Danksharding upgrade, which has moved it to proof-of-stake and slashed layer-2 chain costs.

 Key points

• Highest revenue generator in the crypto space
• Revenue primarily comes from transaction fees paid by users
• Profitability fluctuates due to issuance rewards to validators
• Q1 2024 was profitable, while Q2 saw a decline due to activity moving to layer-2 solutions

2. Tron: The Stablecoin Highway

Surprising many, Tron takes the second spot with approximately $852 million in revenue YTD (year to date). Tron’s success is largely attributed to its role as a major conduit for stablecoin transfers, particularly USDT in developing economies. It’s cheap, fast, and reliable. 

Key points

• Second-largest stablecoin ecosystem after Ethereum
• Popular in countries like Argentina, Turkey, and various African nations
• Competes with Ethereum and Solana for highest stablecoin transfer volumes

3. Maker: The OG Stablecoin Protocol

Maker, the protocol behind the DAI stablecoin, comes in third with $176 million in revenue YTD. Its business model revolves around issuing DAI against crypto collateral and charging interest on these loans.

Key points

• Total DAI supply is currently 5.2 billion, down from its all-time high of around 10 billion
• It has diversified revenue streams, including holding real-world assets (RWA) at 25.6% of total revenue
• Estimated earnings of $73 million annually after accounting for DAI Savings Rate and operating costs

4. Solana: The Phoenix Rising (Again)

Once written off as dead, Solana has made an impressive comeback since its 2023 Breakpoint conference, ranking fourth with $135 million in annualized revenues YTD. Its resurgence is attributed to increased activity in memecoins, NFTs, and DePIN (Decentralized Physical Infrastructure Networks) projects.

Key points

• Revenue comes from transaction fees paid to validators
• High token issuance costs make it challenging to assess profitability
• Success driven by technological improvements and community-driven events like the JTO airdrop

5. Ethena: The New Stablecoin Contender

Launched in January 2024, Ethena has quickly become the fifth-largest revenue-generating protocol, with $93 million in annualized revenues. It’s backed by big names like Arthur Hayes, and while it’s conjured up some early Luna 2.0 fears due to its algorithmic stablecoin design, so far it’s doing well. Its USDe token, a synthetic dollar, has achieved a market cap of $3.6 billion in just a few months.

Key points

• Innovative delta hedging strategy to maintain USDe peg
• Currently the most profitable decentralized app (dAPP) YTD with $41 million in earnings
• Business model designed to excel in bull markets, raising questions about long-term sustainability

6. Aerodrome: The Base Layer AMM

Aerodrome, an automated market maker (AMM) on the Base layer-2 network, has generated $85 million in revenue YTD. Launched in August 2023, it has quickly established itself as the top decentralized exchange (DEX) on Base.

Key points

• Implements successful mechanisms from various DEX protocols
• Uses vote-escrowed tokenomics to attract liquidity
• Incorporates concentrated liquidity features to compete with Uniswap

7. Lido: The Liquid Staking Giant

Lido, a prominent liquid staking protocol, has generated $59 million in revenue year-to-date across Ethereum and Polygon proof-of-stake chains. Its popularity stems from making Ethereum staking more accessible to average users. 

Key points

• Revenue comes from a 10% fee on users’ staking rewards
• Profits of $22.5 million YTD after accounting for node operator payments and token incentives
• Operates as a double-sided market, connecting ETH holders with professional node operators

8. Base: The Coinbase L2 Solution

Base, a fast-growing Ethereum layer-2 solution launched by Coinbase in Q3 2023, clocks in at $52 million in revenues YTD. As a relatively new entrant, its rapid growth is noteworthy, and its backing by Coinbase could see it reach the top of the food chain very quickly.

Key points

• Revenue comes from user transaction fees
• Impressive profitability with $35 million in earnings YTD
• Benefited significantly from the implementation of EIP-4844 that reduced data availability costs

9. Uniswap Labs: The DEX Pioneer

Uniswap Labs, the company behind the popular decentralized exchange Uniswap, has generated $39.3 million in revenue YTD. Uniswap was the earliest DEX to gain real traction, and continues to play a crucial role in the DeFi ecosystem.

Key points

• Revenue primarily comes from trading fees
• Pioneered the automated market maker (AMM) model in DeFi
• Continues to innovate, with features like concentrated liquidity in Uniswap V3
  

10. PancakeSwap: The BSC DeFi Leader

PancakeSwap, a leading DEX on the Binance Smart Chain (BSC), rounds out the top ten revenue-generators, with $36.3 million in revenue YTD. Its success highlights the growing importance of alternative blockchain ecosystems.

Key points

• Largest DEX on Binance Smart Chain
• Offers a wide range of DeFi services – including trading, yield farming, and NFTs
• Lower transaction costs compared to Ethereum-based DEXs

Comparing the Ten Chains:

Revenue Generation (year-to-date)

1. Ethereum: $1.42 billion
2. Tron: $852 million
3. Maker: $176 million
4. Solana: $135 million
5. Ethena: $93 million
6. Aerodrome: $85 million
7. Lido: $59 million
8. Base: $52 million
9. Uniswap Labs: $39 million
10. PancakeSwap: $36 million
    

Ethereum’s revenue still dwarfs that of its competitors, emphasizing its dominant position. However, the presence of new entrants like Ethena, Base, and established DEXs like Uniswap and PancakeSwap shows that revenue is chain-agnostic and that investors will find it wherever they can. 

Remember the importance of understanding tokenomics; Lido, for example, still trades at under $2, the same price it had two years ago, despite its market cap growing 50x. When assessing a cryptocurrency, look at its fully diluted value (FDV) instead of current market cap. 

Profitability

Profitability varies significantly among these protocols due to differences in their business models and their running cost:

• Ethena: leads in profitability with $41 million in earnings YTD.
• Base: shows strong profitability with $35 million in earnings.
• Maker: estimates $73 million in annualized earnings after costs.
• Lido: reports $22.5 million in profits YTD.
• Ethereum and Solana’s profitability is more complex due to token-issuance costs.
• Profitability data for Uniswap Labs and PancakeSwap is not readily available.

Business Model Diversity

The top cash cows in crypto have diverse business models:

• Infrastructure providers: Ethereum, Tron, Solana, Base
• Stablecoin issuers: Maker, Ethena
• DeFi protocols: Aerodrome, Lido, Uniswap, PancakeSwap

There is more than one way to skin a cat. Protocols in the crypto ecosystem can generate revenue in entirely different ways – from providing foundational infrastructure to offering specific financial services.

Market Position and Competition

• Ethereum maintains its leadership position, but faces growing competition from layer-2 solutions and alternative layer-1 blockchains.
• Tron has carved out a niche in stablecoin transfers, particularly in developing markets.
• Maker continues to be a major player in the stablecoin space, but faces new competition from innovative protocols like Ethena.
• Solana has shown resilience and adaptability, rebounding from near-collapse to generate healthy revenue.
• Base and Aerodrome demonstrate the potential for new entrants to quickly gain market share with innovative features and strong backing.
• Uniswap and PancakeSwap showcase the ongoing importance of decentralized exchanges, with each dominating their respective blockchains.

Sustainability and Future Outlook

When assessing these protocols, it’s crucial to consider the sustainability of their revenue models:

• Ethereum’s shift to proof-of-stake and the growth of layer-2 solutions may impact its long-term revenue structure.
• Tron’s reliance on stablecoin transfers could be vulnerable to regulatory changes or shifts in market dynamics.
• Maker’s diversification into real-world assets may provide more stable revenue streams.
• Ethena’s success in bull markets raises questions about its performance during market downturns.
• Base and Aerodrome will need to maintain their innovative edge to continue attracting users and liquidity.
• Uniswap and PancakeSwap face increasing competition from other DEXs, and may need to continue innovating to maintain their position in a competitive market.

Conclusion

The top ten cash cows in crypto are a mix of established giants, innovative newcomers, and specialized DeFi protocols. While Ethereum continues to dominate in terms of raw revenue, the success of newer protocols like Ethena and Base, as well as the continued relevance of DEXs like Uniswap and PancakeSwap, demonstrates the ongoing evolution and diversification of the crypto landscape.

The presence of both infrastructure providers and application-layer protocols in this list highlights the importance of a robust and diverse ecosystem. Investors and users should closely monitor these protocols, as their performance often serves as a barometer for broader trends in crypto. 

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