In the vast star map of Web3, the Kite ecosystem is like an ambitious interstellar exploration. It carries the expectations of countless dreamers, developers, and early pioneers, trying to carve out new territories in an unknown digital universe. But just like any expedition, fuel, supplies, and logistics are the lifelines that sustain its progress. We can't help but ask: in this grand digital expedition, who is quietly fueling Kite's tanks and paying for its journey? Is it those passionate early investors, the growing community of ordinary users, or the mysterious external capital that continues to flow in? We will use on-chain data as a compass to delve into this invisible bill, revealing the true economic support behind the prosperity of the Kite ecosystem.
Kite, a modular blockchain project that has rapidly risen in the past year, is centered around providing a highly customizable execution environment, likened to 'Lego blocks of the digital world'. Developers can freely combine the consensus layer, data availability layer, and execution layer according to their needs to build dedicated Layer2 or Layer3 application chains. This innovative architecture avoids the performance bottlenecks of traditional monolithic blockchains and grants application chains greater sovereignty and flexibility, akin to creating a dedicated 'highway' for each digital citizen rather than sharing a congested single lane. Its uniqueness lies in the fact that Kite does not simply replicate the Ethereum Virtual Machine (EVM), but introduces a new paradigm of heterogeneous computing, allowing different types of DApps to run in the most suitable execution environment, such as a ZK Rollup layer designed for high-performance transactions or an OP Rollup layer optimized for complex AI model computations. As of December 2025, the Kite ecosystem has launched over 30 DApps, covering various fields such as DeFi, GameFi, and DePIN, with a total locked value (TVL) exceeding the equivalent of 1.5 billion KITE tokens.
However, the health of an ecosystem ultimately returns to the self-consistency of its economic model. Kite's tokenomics has designed a dual incentive mechanism: one is to participate in network security and governance by staking KITE tokens, earning block rewards and a share of transaction fees; the other is to attract early contributors through the 'developer incentive pool' and 'user growth fund'. On-chain data shows that in the early stages of the Kite ecosystem, from the second half of 2024 to early 2025, about 60% of new staking and 90% of DApp user subsidies came directly from the project parties or early VC-locked KITE token releases. This huge 'expenditure' is undoubtedly borne by the project's startup capital and strategic investors, who act like 'venture capitalists', providing the initial fuel for this interstellar exploration. At this stage, the average daily active addresses surged from less than 10,000 to 150,000, and the average daily transaction volume grew from a few thousand to over 500,000, but the average transaction fee per transaction was extremely low, often covered by subsidies. This indicates that the initial prosperity was more attracted by 'free' or 'low-cost' offerings, with project parties footing the bill for user experience.
Entering mid-2025, Kite's economic model began transitioning towards self-sufficiency. The project parties gradually reduced direct token subsidies, focusing instead on the value capture ability and user retention of the DApps themselves. On-chain data shows that as of December 2025, the average daily transaction fees on the Kite network stabilized at about 0.01 KITE, with approximately 70% of the fees paid by users rather than subsidized by DApps. This change is significant as it marks the beginning of users paying the real cost for the services they enjoy, indicating that the ecosystem is gradually shedding the 'blood transfusion' model and starting to develop 'blood production' capabilities. Additionally, the distribution of KITE token holders has also become healthier, with the top ten holding addresses (excluding project parties and exchanges) reducing their holding ratio from 45% a year ago to the current 28%, suggesting that the tokens are dispersing from highly concentrated early investors to a broader community. However, this does not mean there are no risks. The Kite ecosystem still overly relies on a few popular DApps; if these core applications encounter issues, it could cause significant shocks to the value capture ability of the entire ecosystem. Furthermore, in the face of fierce competition from other modular blockchain solutions, Kite still needs to continuously invest in technological innovation and developer community building, or its 'digital Lego' advantage may be quickly imitated and surpassed.
For participants in the Kite ecosystem, understanding the economic logic behind this 'bill' is crucial. For developers, future growth will no longer be a simple subsidy competition, but will return to user needs and the product itself. Those who can create truly valuable applications that attract users to pay will secure a place in the Kite ecosystem. For investors, rather than focusing on short-term token price fluctuations, it is better to analyze the on-chain activity data of core DApps in depth, such as the user payment rate, repeat purchase rate of specific applications, and the actual on-chain revenue generated by these applications. We expect that within the next 6-12 months, Kite will launch a more refined fee market and token burn mechanism to further enhance the value capture ability of KITE tokens and may pilot community voting to determine the distribution of incentive pools, making governance more decentralized.
In summary, the early stages of the Kite ecosystem were supported by substantial investments from its strategic investors and project parties, who were the most important 'paymasters' in the early phase of interstellar exploration. As the ecosystem matures, transaction fees contributed by users are becoming an increasingly important source of income, marking a gradual shift towards a sustainable 'self-sufficiency'. However, this transformation is not without challenges; dependence on core DApps, market competition, and the degree of decentralization in governance will be key tests of whether Kite can truly achieve long-term prosperity. For all readers interested in Kite, we recommend closely monitoring the following indicators: weekly active users and the ratio of paying users for core DApps, the daily trading volume and burn rate of KITE tokens, and new developments in the project parties' technical innovation and ecosystem incentive strategies.
This article is an independent personal analysis and does not constitute investment advice.
