The architecture of blockchain value: capabilities, pillars, and growth dynamics

Accepted for publication in Frontiers in Blockchain. This paper develops a capability-based framework for understanding the architecture and value of blockchain systems. We classify networks into three paradigms: single-capability systems that deliver one core function, multi-capability systems that integrate programmable services, and meta-capability systems that coordinate marketplaces of heterogeneous services. To explain how these paradigms scale, we introduce five architectural pillars, purpose, consensus, incentives, tokenomics, and network effects, that jointly determine the feasibility and sustainability of capability sets. Building on these foundations, we propose a valuation model in which network value arises from user adoption, per-unit service value, and architectural network effects, with composability across capabilities generating quadratic growth advantages. A formal dominance result shows that, under symmetric conditions, meta-capability systems structurally outperform multi-capability systems, which in turn dominate single-capability systems. The framework advances both theory and practice by linking protocol design choices directly to value creation. For managers, investors, and policymakers, the results highlight why some architectures scale reliably while others encounter structural bottlenecks, offering a structured basis for evaluating long-term viability and strategic positioning of blockchain ecosystems.