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Ethereum and Stablecoins- Ethereum Emerges as Primary Settlement Layer for Digital Dollars
Ethereum and Stablecoins– Maria Shen, General Partner at Electric Capital, highlighted the rapid growth of stablecoins, stating, “Stablecoins are spreading the dollar faster than any financial tech in history.” Her comments coincide with a recent research report marking Ethereum’s tenth anniversary and the surge in stablecoin demand on its network.
Stablecoins Unlock Global Dollar Access
For the first time, billions worldwide can hold U.S. dollars digitally via stablecoins, driving unprecedented demand. Despite ongoing discussions around “de-dollarization,” the global appetite for dollars is thriving, particularly through stablecoins, which now boast a market capitalization exceeding $260 billion.
The research emphasizes that over four billion people and countless businesses, especially in emerging markets, seek dollar access. Yet, these new dollar holders require more than digital currency—they need yields, investment options, and financial services. Traditional finance struggles to meet these demands due to regulatory, infrastructural, and geographic limitations.
Ethereum: The Primary Settlement Layer
Ethereum is uniquely positioned to support this burgeoning digital dollar economy. “Ethereum is becoming the financial backbone,” Shen added, underlining the platform’s global accessibility, institutional-grade security, and resilience against government interference.
Currently, Ethereum underpins the largest on-chain economy, hosting more than $140 billion in stablecoins and tokenized real-world assets alongside $60 billion in decentralized finance (DeFi). This positions Ethereum as the on-chain equivalent of traditional financial anchors like Treasuries and gold.
The Flywheel Effect and Lack of Competition
As stablecoin usage expands, Ethereum’s ecosystem benefits from a reinforcing cycle: increased ETH collateral in DeFi and real-world finance, higher staking rates that secure the network and reduce circulating supply, and greater inflows of institutional capital, aided by regulatory clarity and composability.
According to the report, “There is no real competition at the moment,” due to Bitcoin’s limited programmability and other blockchains’ shortcomings in security, decentralization, and institutional credibility.
Moreover, traditional finance remains geographically and regulatorily siloed, unable to serve the broad global demand that stablecoins unlock. As observed, opening bank accounts internationally without local presence remains a challenge.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
