a16z Crypto said finance is one of the clearest use cases for blockchains, but it is also one of the most demanding. Putting assets, ownership records, and execution rules into a shared system that no single counterparty controls is often presented as a core advantage of blockchains. That does not mean blockchains are automatically ready for the scale and operational complexity of global financial markets.
According to the article, the debate over whether blockchains are ready for large-scale use has long focused on cost and throughput. Throughput defines how many transactions a chain can process per second, and without enough capacity, large-scale financial use is not realistic. As the gap in throughput between many live systems has narrowed, the discussion has started to shift.
As financial institutions begin to execute trades onchain and issue stablecoins and tokenized assets, they need to judge whether these networks can meet the operating standards of real financial markets. That includes reliable market access, predictable transaction handling, and control over whether sensitive information is disclosed and when it is disclosed. Those protections also need to hold up during congestion, outages, or attacks.
a16z Crypto said blockchain designers have spent years working on these questions. The article lays out what has improved, what remains unresolved, and why current blockchains are in a better position than earlier systems to support financial markets.
Predictability: transaction inclusion must happen on time and under known rules
For years, limited processing capacity was the most obvious bottleneck. When throughput was too low, congestion and high fees made many real financial applications impractical. If a network cannot handle rising activity, routine actions such as placing or updating orders become expensive and unreliable.
That constraint has eased over the past several years, especially through the latest round of infrastructure upgrades. a16z Crypto wrote that total blockchain throughput across the industry has increased by more than 100x over five years, and some production blockchain systems can now process tens of thousands of transactions per second. The article added that this may rise further as stress testing continues and new architectures are deployed.
Still, throughput by itself does not answer a more important question: when exactly will a transaction make it into a block? That is the issue predictability is meant to solve. In financial markets, many actions are valid only within a narrow time window, so transactions must be included on time and handled according to rules participants understand in advance.
The article notes that one second of uncertainty may not matter much for a retail payment. In financial markets, even millisecond-level uncertainty can weaken trust in a venue. It gives the example of an onchain order book: if a trader’s cancellation request does not take effect in time, someone else may trade against a quote that is no longer valid. Market makers would price that risk into their quotes by widening spreads, leaving all participants with worse execution.
In that framework, predictability has two parts. One is assurance that transactions can be included in time, which the article ties to censorship resistance. The other is assurance that transaction ordering is governed by clear rules.
Resilience: market participants should not depend on a single access point
The article then turns to resilience. Even if ordering rules are carefully designed, a separate problem remains if a single party can still decide who gets to submit and execute transactions.
a16z Crypto uses the New York Stock Exchange as an analogy. If the NYSE picked a random staked node every second from around the world and let that node control the channel through which all orders enter the market, those nodes would wield enormous power over execution. Ordering governs what happens after an order is onchain. Resilience asks an earlier question: can participants reliably get orders into the system at all, or do they depend on one gateway or operator whose decisions can affect prices, risk, or outcomes?
Developers are therefore moving from the idea that a transaction will eventually be included to a stricter requirement: whether it can be included in time. The goal, the article says, is that a valid transaction that reaches the network in time should be included immediately, not merely promised that it will be processed soon. Financial markets need that level of certainty.
a16z Crypto researchers have proposed the concept and measurement framework of Strong Chain Quality. The core idea is to stop access to the next round of execution from depending on a single queue controlled by one operator. In practical terms, a blockchain could reserve part of each block for transactions submitted through other network paths, giving valid transactions multiple ways in and reducing one operator’s influence over which transactions are handled first.
The aim is to make block space shared infrastructure with multiple entry points rather than a queue under the control of a single actor. The article says that would require protocol designs more complex than the systems in operation today, but the added complexity may be worth it if participants can still trust that their transactions will be processed properly under heavy stress.
Ordering: markets need to know how trades will be sequenced
Predictability also depends on how a venue decides transaction order after a trade enters the pending state. Many blockchains do not finalize transactions one by one. They batch them into blocks, which are then written to the ledger by builders or proposers.
In many current systems, builders or proposers have broad discretion over which transactions to include and how to arrange them. That design may simplify the protocol and may be acceptable for some applications. In financial markets, though, order matters because it decides who gets priority, what price they receive, and whether execution is fair.
The article adds that if one party controls the next block, it may see transactions before everyone else and act first. In crypto markets this is usually described as MEV, the value captured beyond normal block rewards by including, excluding, or reordering transactions.
It uses the sandwich attack as an example. A trader sees a pending transaction, trades ahead of it to move the price, and then completes another trade immediately after the original order executes, profiting from the price move. For institutional markets, the issue is even more direct: whoever controls order flow may be able to use that information before other participants can respond.
a16z Crypto says this resembles flaws already present in traditional market structure, where centralized intermediaries may profit from privileged access to order flow and trading intent. If onchain markets cannot provide strong guarantees around ordering and execution, they may reproduce the same information asymmetries.
Protocol designers are studying clearer ordering rules, including deterministic rules based on priority fees and rules set by specific venues for their own applications. The exact mechanisms remain an active area of research, but the principle is familiar to traditional finance: participants should be able to predict with reasonable accuracy how their transactions will be ordered and executed, similar to price-time priority in conventional venues.
The article stresses that inclusion and ordering have to work together. If a bid in an auction or a liquidation trade is selectively delayed before it reaches the ordering stage, a fair ranking rule will not solve the problem. The reverse is also true. If participants cannot tell how a transaction will be treated after inclusion, timely inclusion loses much of its value.
High throughput makes onchain finance possible, the article says. Predictable inclusion and clear ordering rules are what make it usable when timing matters and markets are under pressure.
Privacy: protect trading intent before execution
The final requirement in the article is privacy. A transaction can reveal what information a participant has or what they intend to do next. The size and direction of an order, for example, may show whether a fund is building or reducing a position. If that information becomes public before the order is fully executed, other traders may step in first and move the price.
This matters even more onchain because many blockchains expose pending transactions before final confirmation. Even if full secrecy after execution is not possible, financial markets still need protection for information before execution.
The current design goal, according to the article, is to keep transaction details hidden while they can still be used against the trader, and then support more varied privacy models after execution. Once a trade is complete, disclosure rules can change. A public market may publish a full record, while a bank may disclose the relevant record only to counterparties and regulators. Even if outside parties cannot see every detail, they should still be able to verify that the trade followed the rules.
To get there, protocol designers are exploring cryptographic techniques such as timelock encryption and threshold encryption. These methods can keep transaction contents hidden until a preset time has passed or until a committee confirms that the transaction’s position in the block has been fixed. At that point, even if the market sees the trade, it can no longer front-run it.
The article argues that markets can remain transparent without forcing every participant to view every unexecuted order in real time. Onchain finance needs the same boundary: auditable after execution, confidential before execution.
Beyond throughput
a16z Crypto said that if blockchains are to become core financial infrastructure, they must support a market participants can trust. Throughput is only the first test. Without enough processing capacity, onchain finance remains limited. Once speed becomes table stakes, the harder question is whether blockchains can meet the standing requirements financial institutions already apply to market infrastructure.
Those requirements include predictable execution, clear and unambiguous priority rules, stable market access under stress, and protection for pre-trade information without sacrificing post-trade transparency.