Although the media often emphasizes 'de-dollarization', the reality is that the demand for the US dollar globally is increasing at an unprecedented rate. Over 4 billion people and millions of businesses are looking to access USD through stablecoins – marking the strongest expansion in the 'network effect' of the USD in decades.
This creates a historic opportunity for Ethereum. Stablecoins (like USDT, USDC…) not only help people access digital USD, but also drive demand for:
Yield (interest on held amounts)
Investment opportunities
Comprehensive financial services
However, traditional finance cannot serve this massive new market due to regulatory and infrastructure constraints. Only Ethereum can serve as the foundation for a digital economy using USD, and that will significantly increase the value of ETH.
Stablecoins are bringing millions of new USD holders
Why is the whole world turning to the USD?
Over 4 billion people live in countries with unstable currencies, high inflation, or weak monetary policies.
About 21% of the global population lives in countries with inflation above 6%/year, causing savings to quickly lose value.
For them, holding USD is a safe choice, a way to conduct international transactions and hedge against risks from local currencies.
Businesses also need USD for transactions:
USD accounts for 88% of global foreign exchange transactions, being the primary currency in international trade.
Businesses in emerging markets need USD for imports, cross-border payments.
Small businesses, freelancers need digital USD to receive international payments and avoid exchange rate risks.
Stablecoins open up the ability to hold USD for everyone:
Just need an Internet connection, anyone can hold USD in the form of stablecoins.
Since 2020, the market capitalization of stablecoins has increased 60 times, exceeding 200 billion USD.
The use of stablecoins is concentrated in countries like Nigeria (top 2 crypto markets in the world) or China (despite banning crypto).
So why is holding ETH the best way to take advantage of the stablecoin wave?
Stablecoins are creating a completely new group of USD users, from households saving with USDC to businesses pricing in USDT.
But holding USD is just the first step – users want to invest, earn interest, build wealth.
Traditional finance cannot serve this new stablecoin user group
US banks can only serve a very small part of the global population due to regulatory requirements.
Cross-border financial services are very expensive and slow.
Traditional finance only serves the wealthy, large organizations, and cannot serve the global mainstream user group.
→ A new financial infrastructure is needed that can serve billions of people holding stablecoins.
The new financial system needs to meet three important criteria:
Global availability – anyone with the Internet can access it.
Safe for institutions – can build financial products worth billions of USD.
Not controlled by the government – cannot be easily blocked or seized.
Ethereum is the only platform currently meeting all three of these criteria:
How does Ethereum meet the requirements?Global availabilityAnyone can use it, 24/7, no geographical limitsSafetyMost decentralized network, mature security infrastructure, 100% uptime for 10 yearsClear regulationETH is considered a commodity in the US – legalHigh customizabilityCan build Layer-2 (like Coinbase, Robinhood are doing) to comply with regulationsAnti-interferenceNo central point for government control
Ethereum has a level of decentralization that other chains cannot easily replicate:
Over 1 million validators in more than 100 countries
Developed by many independent groups
Decentralized platform from the start – cannot be replicated in today's regulatory environment
ETH will become a reserve asset in the new financial ecosystem
What is a reserve asset?
As a reliable underlying asset in a financial system, such as:
Used as collateral
Used for storing value
Used for making large transactions
In traditional finance, that is USD, US Treasury bonds, gold.
ETH can perform this role because:
Difficult to inflate: Predictable supply, no central bank.
Generates yield: Can stake to earn interest (like real estate or bonds).
Makes the best collateral asset: ETH is collateralizing protocols worth 19 billion USD on Ethereum.
Anti-control: Cannot be seized or frozen by the government.
High liquidity: Fast trading, large volume, deep and global.
→ Conclusion: As stablecoins are used more, the demand for using ETH as a reserve asset will also increase significantly.
The development of Layer-2 further drives the demand for ETH
Layer-2 networks on Ethereum help:
Reduce transaction fees
Increase speed
Create many new applications → requires using ETH as collateral, gas fees, underlying assets
→ ETH is increasingly used in more fields, especially in the digital USD ecosystem.
ETH will become a global store of value
Like Bitcoin, ETH has all the characteristics of a store of value (Store of Value – SoV), but even better:
AssetsIs it profitable?Is it controlled?Liquidity?Decentralized?GoldNoNoAverageNoBTCNoNoHighYesETHYes (staking)NoHighYes
→ ETH can both store value and generate income, making it more attractive for investors.
Why hold ETH instead of other options?
Alternative optionsDisadvantagesTraditional financeCannot reach billions of peopleGovernment-controlled systemDoes not guarantee property rightsBitcoinLacks programming capability for financial servicesOther blockchainsNot secure enough, not decentralized enough
→ ETH is the most accessible and efficient option to participate in the global stablecoin economy.
Is it possible to invest in DeFi instead of ETH?
Yes, but with higher risks, requires expertise.
→ For most individual and institutional investors, holding ETH is the simplest way to benefit from the stablecoin boom.
Risks to monitor
1. USD becomes the primary reserve asset, ETH is reduced to 'gas fees'
If USDT, USDC are used for collateral and primary payments, ETH may lose its role. But ETH remains the only completely decentralized asset on Ethereum, while stablecoins can be locked or seized. ETH also generates staking yields of 3–5%. → This risk is unlikely to occur.
2. CBDCs (central bank digital currencies) compete with stablecoins
CBDCs can provide digital USD 24/7, but:
Often not cross-border compatible
Not open to developers
Lacks flexibility
→ It is difficult to replace existing stablecoins, which already handle trillions of USD each year.
3. Other blockchains fall short of Ethereum
A fast, cheap, less decentralized chain may attract short-term users. But it is difficult to achieve the level of decentralization, security, and strong infrastructure like Ethereum, making it hard to replace Ethereum in the long run.
Some important data:
Stablecoins handle over 6 trillion USD/year, ten times that of 2020
Ethereum holds over 55% of the stablecoin market share
ETH accounts for 44% of collateral in DeFi, worth 19 billion USD
In summary
Holding ETH is the best way to take advantage of the stablecoin wave
Stablecoins are the largest growth driver for Ethereum. The more stablecoins are used, the more ETH is required. ETH becomes the center of:
Payments
Collateral
Yield from staking
Network governance
→ A self-reinforcing 'growth flywheel' makes ETH increasingly valuable and essential in the digital USD economy.