ARK compares Ethereum, Solana and Hyperliquid to fast-food chains

Lorenzo Valente, researcher at ARK Invest, draws a striking comparison between three major blockchains and well-known fast food chains. In an extensive piece, he argues that Ethereum, Solana and Hyperliquid use fundamentally different models to retain value, and that all three can be successful in their own way.

In short:

• ARK Invest analyst Lorenzo Valente compares the value models of Ethereum, Solana and Hyperliquid with three fast food chains.
• Ethereum is seen as a franchise system that earns too little on the settlement layer, while Solana is seen as a vertically integrated model that retains more fees.
• Hyperliquid has the shortest value chain but carries a higher concentration of risks.

Ethereum as McDonald’s: big, but too cheap

Valente describes Ethereum as the McDonald’s of crypto. The network has built the most extensive franchise system through layer 2 networks, but in his view charges too little on the settlement layer itself. Ethereum currently stands at $2.400, a slight decline of 0.5% over the past 24 hours.

The fact that Ethereum struggles to retain value directly is a well-known criticism. The growth in DeFi activity increasingly takes place on layer 2 networks, causing revenues for the base protocol to lag behind.

Solana as Chipotle, Hyperliquid as In-N-Out

Valente compares Solana to Chipotle: a vertically integrated model that keeps more fees and so-called MEV (maximal extractable value) within its own ecosystem. This gives Solana more direct revenue compared with Ethereum, but also a different risk structure.

Hyperliquid is assigned the role of In-N-Out. The blockchain has the shortest chain between activity and value creation, partly thanks to tight vertical integration, no venture capital funding and the buyback of its own HYPE token through fees. HYPE was recently included for the first time in a US crypto index ETF.

At the same time, Valente points to the downside of the Hyperliquid model: the concentration of risk is greater, both in terms of the product offering and the team and revenue sources. ARK Invest has previously published research together with Glassnode, in which the company examined the degree of centralisation within Bitcoin.

Valente concludes that the three networks do not need to be direct competitors. Because each follows a different model, he believes there is room for all three to carve out their own position in the long term.