## What Does the Intense Debate Over the Moats in the Crypto Industry Reflect?

Recently, qw, co-founder of Alliance DAO, publicly shared his unique scoring system for competitive barriers across different industries, giving public chain projects a moat rating of only 3/10. This viewpoint immediately sparked heated discussion within the industry.

qw's scoring criteria list tech giants like Microsoft, Apple, and Visa as 10/10 (strongest moat), emphasizing their key SaaS, brand ecosystem, or payment network effects. In his evaluation system, Bitcoin is rated separately as 9/10, and ASML is at the 10/10 level. In comparison, he believes the entire public chain sector's moat is significantly weaker, only 3/10.

qw further explained that a weak moat is not necessarily a bad thing, but it means teams must maintain continuous innovation leadership, or they risk being quickly replaced. He also stated that if someone believes that a "weighted index of a selected basket of public chains" can outperform a "portfolio of 8–10 full-score projects" over the next 10 years, they are welcome to settle this debate through a wager.

## How Strong Is Ethereum's Moat?

Dragonfly managing partner Haseeb strongly rebutted qw's viewpoint. Haseeb pointed out that rating the blockchain moat as 3/10 is simply absurd.

Using Ethereum as a case study, he emphasized its decade-long dominance. During this period, hundreds of competitors have raised over $10 billion in total funding attempting to capture market share, but after facing all challenges over ten years, Ethereum remains at the top of the industry. Haseeb believes that if such market performance is not enough to prove the existence of a strong moat, then the very concept of a moat might be meaningless.

## The Real Attitude of Regulators Toward the Crypto Industry

The recent preliminary findings from the Office of the Comptroller of the Currency (OCC) provide a real-world context for this moat debate. OCC pointed out that between 2020 and 2023, nine of the largest banks in the US imposed restrictive measures on some "politically sensitive" industries, including the crypto sector.

These restrictions included account opening limitations, service reductions, or higher-level approval requirements. Affected sectors, besides crypto issuers, exchanges, and custodians, also include oil and gas, coal, firearms, private prisons, tobacco and e-cigarettes, and the adult industry. Some banks attributed these restrictions on crypto companies to "financial crime considerations."

The OCC's survey involved nine major banks, including JPMorgan Chase, Bank of America, Citibank, and Wells Fargo, and the investigation is ongoing.

Analysts note that the OCC report did not mention some more critical causes of "de-banking," such as regulators' assessments of reputational risk for banks, and the previous requirement by the Federal Deposit Insurance Corporation (FDIC) for banks to "stay away from the crypto industry." These implicit factors may have a more substantial impact than the surface-level "financial crime considerations."

From the debate over moats to regulatory restrictions, it reflects that the crypto industry is still in a critical period of building trust and market position.