Robinhood Chain Generates $4 Million in Revenue, Experimenting with Profit Models

Layer 2 and new chains are shifting from merely selling blockchain space to a revenue structure that directly embraces application fees and payment flows. As chain fees decrease, user costs are reduced, but the operators of the chain face pressure to redesign profitability and token economics.

Castle Labs stated in an analysis published on the 22nd at 11:31 PM (KST) that "selling blockchain space is no longer a defensible business." The execution space provided by blockchain is becoming increasingly similar, and the differentiating factors have shifted to liquidity and actual application usage.

Blockchain space refers to the processing capacity that allows transactions and data to be recorded on the blockchain. Until now, chains have earned fees by selling this space, but due to technological improvements and intensified competition, processing costs have decreased, leading to a structure where chain revenues cannot keep up with application revenues.

Arbitrum (ARB) has positioned itself towards ecosystem expansion. The Robinhood ($HOOD) chain launched its own Layer 2 utilizing the Arbitrum stack in July. Castle Labs explained that the revenue from this chain is distributed in a 90:10 structure.

Castle Labs reported that the Robinhood chain has generated approximately $4 million (about 5.5 billion KRW) in revenue since its launch, with about $390,000 (about 500 million KRW) going back to Arbitrum according to the 90:10 distribution structure. The total value locked (TVL) in the Arbitrum stack has exceeded $800 million (about 1.1 trillion KRW), and the TVL of the Robinhood chain is presented as half of Arbitrum's main TVL of $1.63 billion (about 2.26 trillion KRW).

Arbitrum has also attached a separate revenue source for transaction priority fees. Timeboost allows users to pay an additional fee to obtain a faster transaction order, which was introduced in April 2025. Castle Labs reported that Timeboost has contributed over $7.7 million (about 1.07 billion KRW) to the Arbitrum treasury since its introduction.

This trend aligns with previous discussions that chains are becoming similar to software-as-a-service providers. Developers can build applications by borrowing stacks without directly creating chains, and the chain operators take a portion of that revenue.

Polygon (POL) has shifted its direction towards payment infrastructure. Polygon is promoting a payment chain focused on stablecoin payments and enterprise control features. Castle Labs noted that Polygon has processed approximately $2.9 trillion in stablecoin transactions to date, with stablecoin supply estimated at $3 billion (about 41.58 trillion KRW).

The case of Polygon demonstrates the trend of ecosystem expansion models trying to draw payment usage into the chain. However, Castle Labs pointed out that a significant portion of Polygon's revenue comes from the distribution of Polymarket. High dependency on specific applications means that even if revenue sources widen, the risk of concentration remains.

MegaETH has taken a different path. Castle Labs reported that MegaETH is redirecting the capabilities previously used to support third-party developers towards developing its own consumer applications. Shuyao Kong, a representative of MegaETH, stated, "We are redirecting the energy we used to lend to third-party builders into first-party applications that we create ourselves."

This is an attempt to prevent fees generated by applications on the chain from flowing outside the chain. Typically, applications create fees by directly interacting with users, while the chain remains in the role of infrastructure receiving low processing fees. MegaETH's own app strategy is closer to vertical integration aimed at reducing this gap.

The stablecoin USDm is also in the same context. Castle Labs analyzed that the supply of USDm is currently $18 million (about 2.49 billion KRW), and based on a SOFR of about 3.6%, it could generate $650,000 (about 900 million KRW) as funds for MegaETH's purchase and burning. However, the supply has decreased by over 95% from a peak of about $600 million (about 831.6 billion KRW) in May.

This publication previously reported on the reduction of USDm supply and the revenue structure of MegaETH. The changes confirmed at that time were the supply amount, the rate of decrease from the peak, and the estimated revenue scale, with future evaluations depending on the actual application usage within MegaETH and on-chain liquidity indicators.

Sophon has transitioned from its own chain to developing consumer apps on Base. Castle Labs reported that Sophon was spending $3.4 million (about 470 million KRW) annually on Layer 2 operations and decided to invest capital in app development rather than chain maintenance. The first product is presented as a payment app called Pyre, which combines gaming elements.

This change indicates that the chain has moved to a stage where it competes over how much of the fees and payment flows generated by actual users can be internalized, providing cheaper and faster infrastructure. However, how each model translates into token value, treasury revenue, and actual usage rates should be assessed through verified on-chain indicators and product usage.

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