Onchain Economy Generates $20 Billion in Fees, Signaling Rapid Payments Sector Growth

The onchain economy recorded a significant milestone, generating $20 billion in fees during the first half of 2025, according to a new report from venture firm 1kx. This robust economic activity underscores a maturing digital asset landscape and points to an imminent expansion in blockchain-based payment solutions. Lex Sokolin, Managing Partner at Generative Ventures, lauded the findings, stating on social media, "> Great work from @1kxnetwork on the onchain economy. It is primarily a financial system, built for economic activity."

The "Onchain Revenue Report (H1 2025)" by 1kx aggregated data across more than 1,200 protocols, revealing a shift from speculative trading to utility-driven demand. While decentralized finance (DeFi) protocols dominated with 63% of these fees, emerging sectors like wallets, consumer applications, and Decentralized Physical Infrastructure Networks (DePIN) experienced substantial year-over-year revenue increases of 260%, 200%, and 400% respectively. This growth is partly attributed to an 86% reduction in Ethereum transaction fees since 2021, fostering more efficient application scaling.

Lex Sokolin, whose firm Generative Ventures invests in the "Machine Economy" — a synthesis of fintech, AI, and Web3 — has consistently highlighted the potential of programmable money and stablecoins. His work and investments reflect a focus on innovative payment processing protocols and the integration of AI with onchain financial systems. Generative Ventures has backed projects in areas such as decentralized GPU cloud and AI-to-AI payment processing, aligning with the broader trend of enhancing transactional capabilities on blockchains.

The broader onchain payments landscape is witnessing rapid innovation, offering faster, more secure, and cost-effective alternatives to traditional methods. Stablecoins, digital currencies pegged to fiat assets, are increasingly adopted for cross-border transactions due to their stability and efficiency on blockchain rails. Major financial institutions are exploring and integrating stablecoin-based payment systems, with projections indicating potential trillions in annual stablecoin-based business-to-business (B2B) payments in the coming years.

Looking ahead, 1kx projects onchain fees to surpass $32 billion in 2026, driven primarily by application growth and the continued rise of tokenized Real World Assets (RWAs) and DePINs. Sokolin reinforced this optimistic outlook for the sector, predicting, "> We are going to see a ton more on the payments side soon enough." This forecast underscores the growing confidence in blockchain's capacity to underpin a new generation of financial services and payment infrastructure.