Experts Predict Ethereum To Win Big In The New Stablecoin Economy
The GENIUS Act is predicted to drive world stablecoin use to new heights. With an already established market dominance place, Ethereum stands to learn disproportionately from this transition.
In a dialog with BeInCrypto, Sanjay Shah, a researcher at enterprise capital agency Electric Capital, harassed that the Ethereum blockchain has distinctive architectural benefits that may reinforce the community’s function because the foundational layer for the incoming stablecoin economic system.
Ethereum’s Market Dominance
When US President Donald Trump signed the GENIUS Act into law final month, it triggered a major worth rally throughout the cryptocurrency market.
However, Ethereum’s performance was unmatched. It skilled probably the most constructive and sustained impact, surpassing any competitor within the quick aftermath.
In the times earlier than the invoice’s passage, Ethereum’s worth surged, climbing more than 20% and surpassing the $3,500 mark. The momentum continued even after the invoice was signed, with the community’s worth peaking at $3,875 the next week.
At the time of writing, its worth rests at $4,465.
This highly effective market response strengthened buyers’ confidence in Ethereum’s potential to capitalize on a brand new regulatory atmosphere.
The GENIUS Act has effectively removed major hurdles, paving the way in which for wider stablecoin adoption and simpler world entry to the US greenback, and buyers are betting on Ethereum to prepared the ground.
Will the GENIUS Act Make Ethereum a Financial Anchor?
Stablecoins are set to turn into a central part of the worldwide monetary system, serving as a mainstream dollar rail for various transactions, from financial savings and payroll to cross-border funds.
The regulatory readability offered by the GENIUS Act is the important thing to unlocking this widespread adoption, enabling regulated establishments to concern and make the most of stablecoins confidently.
Ethereum is ripping and the GENIUS Act may be an enormous purpose why.
Here’s what’s driving $ETH (and why I feel it’s simply getting began):
Speculators appear to be front-running the narrative already (let’s be trustworthy, many had been seemingly positioning weeks in the past), betting that… pic.twitter.com/gGJxIBEOVi
— Crypto Auris (@crypto_auris) July 16, 2025
According to Shah, this transition will set up a brand new, open monetary infrastructure, with Ethereum appearing as an anchor.
“Regulated issuance will unlock distribution by means of banks and fintechs. Ethereum could anchor the open, world facet of that system, with L2s dealing with high-throughput exercise and L1 offering safety and finality. ETH the asset could function the impartial, productive reserve collateral that underpins lending and different companies throughout the finance stack,” he advised BeInCrypto.
Since Ethereum already hosts most stablecoin liquidity, it is going to seize the lion’s share of this elevated exercise.
Why Ethereum Is Positioned to Lead
Ethereum’s existing stronghold is constructed on three key properties essential for world, institutional adoption: world accessibility, security for establishments, and resistance to authorities interference.
The laws’s give attention to compliance and safety reinforces these qualities, drawing extra contributors into the community’s orbit. As is, Ethereum already instructions the market.
According to latest knowledge from DefiLlama, Ethereum is answerable for over 52% of the $278 billion stablecoin market capitalization.
“Ethereum could acquire disproportionately from the GENIUS Act as a result of it already dominates the elements of the crypto economic system that the Act is prone to speed up [like] USD-backed stablecoins and the monetary companies that develop round them,” Shah stated.
He additional strengthened this level by saying that the expansion will naturally drift towards the established chief:
“Since Ethereum already hosts the vast majority of stablecoin issuance and liquidity, a lot of that development could stream to its ecosystem, reinforcing the lead it already has.”
However, the incoming wave of stablecoin demand will inevitably place better stress on networks to course of transactions successfully. This actuality presents a major problem for Ethereum given its historical past of scalability points.
According to Shah, it may well simply rise to the event.
L2s: Addressing the Scalability Issue
Ethereum’s scalability points have been a widely known concern within the crypto business. Its mainnet has historically been restricted to processing a small variety of transactions per second, typically resulting in community congestion and elevated transaction charges during times of high demand.
As the GENIUS Act goes into impact, the anticipated growth in stablecoin use will place unprecedented stress on the community’s capability.
According to public statements from Vitalik Buterin and the Ethereum Foundation, the community’s long-term reply to finish a monitor document of scalability challenges lies in Layer 2 solutions (L2s).
These L2s course of the majority of client and institutional stablecoin transactions in a extremely environment friendly, low-cost method. This strategy ensures that the community can handle mass adoption with out compromising on its core rules of decentralization and safety.
The Ethereum mainnet (L1) will serve a unique however equally essential function because the safe settlement layer, dealing with the finality of transactions processed on the L2s.
According to Shah, this synergy is what makes the scaling answer viable.
“The bulk of client and institutional stablecoin throughput is designed to reside on Ethereum L2s (e.g., Base, Optimism, Arbitrum), with L1 appearing because the settlement and safety layer, so scale comes from rollups whereas preserving Ethereum’s belief ensures,” he stated.
He additionally famous the pliability and advantages this method provides to establishments:
“Today’s rollup structure is constructed for high-volume, low-cost funds and monetary apps, and it lets establishments select the fitting trade-offs (throughput, charges, compliance options) with out leaving Ethereum’s safety umbrella.”
Despite the rise of competing blockchains, Ethereum’s dominance can stay agency in gentle of this enhanced infrastructure.
What Needs to Happen to Unseat Ethereum?
While rival blockchains like Solana and Tron have made inroads within the stablecoin market, their problem to Ethereum’s dominance is unlikely to succeed in the long run.
A community’s long-term success in finance relies on its foundational qualities. Decentralization and safety create a virtuous cycle that draws capital and expertise. Ethereum’s proven security record and decentralized nature foster an atmosphere of institutional belief, which pulls in giant swimming pools of capital, creating deep liquidity.
This wealthy ecosystem attracts builders to construct purposes and monetary companies on the platform. Shah argues that these core components make Ethereum’s place troublesome to problem.
“Speed and price are additionally necessary components, however with out the identical decentralization, safety historical past, and institutional customization choices, it could be laborious to dislodge Ethereum’s lead in finance.”
This actuality presents a compelling case for why regulated establishments could really feel extra inclined to decide on Ethereum, despite the fact that they’ll now launch their very own non-public stablecoins.
The Path of Least Friction
Though conventional monetary establishments can discover launching their very own private blockchains, they could gravitate towards open, public networks.
“Some banks will pilot proprietary or permissioned rails, however settlement liquidity tends to coalesce the place counterparties already are. Private networks often bridge again to the place liquidity clears,” Shah advised BeInCrypto.
Though the GENIUS Act opens up new alternatives for establishments, launching and operating a private stablecoin requires a considerable operational dedication.
“The Act lowers the barrier for banks and fintechs to concern, however the path of least friction could stay issuing on, or no less than interoperating with, Ethereum’s liquidity hubs and L2s to entry world counterparties and composable finance,” he added.
Based on present traits, all indicators recommend that Ethereum will strengthen its place as the first settlement layer for digital greenback transactions. The asset’s rising worth and rising institutional curiosity within the community reinforce such a trajectory.
The submit Experts Predict Ethereum To Win Big In The New Stablecoin Economy appeared first on BeInCrypto.
