Web3 Era Ends as Capital Concentrates in Bitcoin and RWAs
In a fresh research note released on February 20, 2026, Greg Cipolaro, Global Head of Research at NYDIG, delivered a blunt message to the market: the crypto “investable universe” is getting smaller - and that may be a sign of maturity, not weakness.
- NYDIG says crypto is narrowing to core financial use cases, not broad Web3 visions.
- Bitcoin, stablecoins, tokenized assets, and limited infrastructure are the likely long-term winners.
- Capital is consolidating, and altcoin narratives are fading.
- 2026 focus: allocate long term, treat Bitcoin as a balance sheet asset.
According to Cipolaro, the era of sweeping Web3 ambitions is fading. Instead of trying to replace nearly every digital service, crypto is consolidating around a narrow set of applications that extend traditional finance onto blockchain infrastructure. The industry, in his view, is shifting from speculation to financial utility.
From Broad Dreams to Financial Plumbing
Cipolaro argues that centralized systems will continue to dominate most consumer and enterprise use cases because they are faster, cheaper, and operationally more efficient. That reality, he says, forces crypto to focus on areas where blockchain provides clear structural advantages – mainly within finance.
This transition implies a sobering conclusion: crypto’s total addressable market could be materially smaller than once projected. However, a narrower scope could also strengthen the assets that remain.
The Short List of Long-Term Survivors
Rather than an explosion of new sectors, Cipolaro identifies a tight cluster of categories likely to endure:
- Bitcoin as the primary monetary asset
- Tokenized real-world assets (RWAs), including tokenized stocks
- Stablecoins as settlement infrastructure
- Select DeFi tools that enhance traditional financial products
- A limited number of general-purpose blockchains such as Ethereum
On tokenized assets, Cipolaro expects gradual progress as interoperability improves. He notes that networks like Ethereum continue to anchor on-chain finance, though institutional-focused alternatives such as the Canton Network – built by Digital Asset Holdings – already hold significantly larger pools of tokenized assets than public chains in certain categories.
Stablecoins, meanwhile, are framed not as trading instruments but as core financial plumbing – settlement rails for institutions, banks, and payment systems.
What Didn’t Make the Cut
Cipolaro effectively calls time on several once-hyped narratives. Blockchain gaming, decentralized social networks, and the metaverse have failed to displace centralized competitors at scale. The broader idea that Web3 would become an alternative to nearly any digital offering has, in his assessment, fizzled.
Capital, he observes, is no longer spreading across experimental sectors. Instead, it is concentrating in core financial infrastructure. This consolidation is visible in Bitcoin’s rising market dominance, suggesting that few durable new altcoin narratives have taken hold.
Bitcoin as a Balance Sheet Asset
NYDIG’s broader 2026 outlook reinforces this institutional pivot. The firm’s “Allocate, Don’t Speculate” theme urges investors to stop chasing cycles and instead treat crypto as a long-term allocation decision.
Bitcoin is increasingly viewed not as a trading instrument but as a treasury asset comparable to commodities or foreign exchange. Public companies holding digital assets on their balance sheets – described as Digital Asset Treasuries – may trade as leveraged crypto exposure, setting the stage for corporate consolidation this year.
Cipolaro also anticipates continued volatility compression, arguing that Bitcoin’s long-term decline in volatility could make it more compatible with traditional portfolio frameworks such as risk-parity strategies.
The Long-Term Risk on the Horizon
While not an immediate threat in 2026, NYDIG flags quantum computing as the dominant existential risk facing the industry. The firm suggests that serious planning for quantum resilience should begin now, even if the practical impact remains years away.
Cipolaro’s conclusion is clear: crypto is not disappearing, but it is narrowing. The future, in his framework, belongs to assets that integrate with traditional finance rather than compete with it head-on.
If that thesis proves correct, 2026 may be remembered less as another speculative cycle – and more as the year crypto fully embedded itself into the global financial system.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alexander Zdravkov is a person who always looks for the logic behind things. He has more than 3 years of experience in the crypto space, where he skillfully identifies new trends in the world of digital currencies. Whether providing in-depth analysis or daily reports on all topics, his deep understanding and enthusiasm for what he does make him a valuable member of the team.
