Are Stable Coins keeping Ethereum alive?

[dim_mak5]

I mean most are on the Ethereum main net. USDC and USDT. USDC is western regulated and USDT is eastern regulated but both are on Ethereum main net.

So lets say trump decides to ban just usdt, how is he going to do it when its on the Ethereum blockchain unless he bans ethereum too but if he does that then that will affect usdc too right?

So all 3 are like properly integrated with each other meaning they cannot be separated right?

Honestly I believe if it wasn't for stable coins Eth would be useless by now worth $0. Otherwise what people will use Ethereum for, just NFTs and selling NFTs for bitcoin not for stable coin payments? Smart contracts with what if there are no stable coins at the other end of the contract?

Eth is not a store of value like btc. Because stable coins are on Ethereum is it fair to say that the true marketcap of ethereum is ethereum marketcap plus all stable coins market caps too?

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

[collecttmaster]

USDT is much more actively used on Tron than Ethereum, so this is probably not true. There are too many scams and risks on Ethereum that many people prefer using Tron, besides it is faster and cheaper. I wonder if there is somewhere good data that compares usage not just issuance. Does anyone know a source?

Honestly I believe if it wasn't for stable coins Eth would be useless by now worth $0. Otherwise what people will use Ethereum for, just NFTs and selling NFTs for bitcoin not for stable coin payments? Smart contracts with what if there are no stable coins at the other end of the contract?

ETH has no advantage over the new generation of coins. It is only there because of age and being the first for these kind of features. Old interests are keeping the price high.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

I think I've read somewhere that someone is trying to deploy a stablecoin on Bitcoin, but I am not sure.

[MAAManda]

You have too many misunderstandings about these concepts. First, if Trump bans $USDT, it won't directly affect $ETH. We might lose a lot of MC if that happens, but that doesn't mean it will directly affect $ETH (currently $USDT is used in many L-1 & L-2 projects).

Referring to the question in the title, I'll answer it with "Maybe", the $ETH ecosystem is indeed supported by stablecoins, but actually it's not only that, there are many other types of supporting assets that keep $ETH alive until now, so, even when stablecoins don't exist, it won't destroy $ETH.

[Ziskinberg]

Or you could even say ETH is what’s keeping stablecoins alive.

I mean, stablecoins like USDT run on different networks (TRON, BNB, and ETH).. but Ethereum is still the most popular and widely used. Without ETH, stablecoins probably wouldn’t even exist in the way we know them now.

People are still investing in ETH.,, they still believe in the project, even with all the bad news about developers or whatever drama’s happening behind the scenes. At the end of the day, it’s the investors that keep a project alive and ETH still has a strong base of supporters backing it.

[roemer]

stablecoins are taking a hit because of trump so ether is coming back around

[FinneysTrueVision]

As unrealistic as it is for stablecoins to become illegal, even if it did happen, there would still be alternative options. CDP stablecoins aren’t backed by US dollars and are fairly decentralized. There are also Euro backed and Yuan backed stablecoins. Trump isn’t dumb enough to do something that would hurt dollar adoption and help out competing currencies.

As for whether it would kill Ethereum, the answer is no. You just have to look at Solana and XRP to see that people will still buy altcoins for other reasons unrelated to stablecoins.

[Lida93]

The underlying question that should be looked into in arriving to a proper answer to the op title should be, what are stablecoins to ethereum, and what is ethereum to stablecoins? Maybe when we delve into the difference that exists in between these questions we can arrive to a more agreeable answer. But then, every good coin's performance should be held up by a community as it live source base on how much of the coins they're holding in treasury... Perhaps, OP's question is drawn from the idea of the US "Genius Act" which is speculated to spark institutional demands to ethereum (similar to institutional demands for BTC) due to the blueprint which makes for regulation for stablecoins distribution.

[dim_mak5]

USDT is much more actively used on Tron than Ethereum, so this is probably not true. There are too many scams and risks on Ethereum that many people prefer using Tron, besides it is faster and cheaper. I wonder if there is somewhere good data that compares usage not just issuance. Does anyone know a source?

Honestly I believe if it wasn't for stable coins Eth would be useless by now worth $0. Otherwise what people will use Ethereum for, just NFTs and selling NFTs for bitcoin not for stable coin payments? Smart contracts with what if there are no stable coins at the other end of the contract?

ETH has no advantage over the new generation of coins. It is only there because of age and being the first for these kind of features. Old interests are keeping the price high.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

I think I've read somewhere that someone is trying to deploy a stablecoin on Bitcoin, but I am not sure.

Okay we can see a clearer picture here. West Vs East. West is Ethereum and USDC Vs East Tron and USDT. However USDT Tether lends money to the USA Government so I don't see why Trump would ban USDT as he is getting $billions from Tether. It is like killing one of your main funders. So from this can we safely assume that Tether USDT will remain for years until if democrats win the next USA election with their anti-crypto stance but then again banning USDT is like I said before killing one of the government main sources of income because Tether buys USA Govt. bonds.

USDC is officially regulated and recognised by the USA Government. People in the poorer east need USDT because the dollar is the world reserve currency and their local currencies are not as strong I guess. They could by USDC but they prefer to support Asian Tron over western Ethereum? So in future it will be like 2 global competing economies that is western blockchain vs eastern blockchain for smart contracts but bitcoin is separate from all this as its a store of value but bitcoin can dominate all if it can do smart contracts too making Ethereum and Tron obsolete.

What you mean too many scams on ethereum compared to tron? You mean ethereum has too many smart contracts defi hacks in compared to tron? Which is more decentralized, Tron or Ethereum?

[dim_mak5]

You have too many misunderstandings about these concepts. First, if Trump bans $USDT, it won't directly affect $ETH. We might lose a lot of MC if that happens, but that doesn't mean it will directly affect $ETH (currently $USDT is used in many L-1 & L-2 projects).

Referring to the question in the title, I'll answer it with "Maybe", the $ETH ecosystem is indeed supported by stablecoins, but actually it's not only that, there are many other types of supporting assets that keep $ETH alive until now, so, even when stablecoins don't exist, it won't destroy $ETH.

Yeah USDT is mostly used on Tron so wont affect Ethereum if USA Govt. goes after Tether but USA Govt. can go after Asian Tron instead and that that will make all USDT holders swap their USDT for USDC out of fear I guess and finish off the Tron network unless Tron and Tether bring their own stablecoin for the chinese currency or whatever. Is that why China does not like Tether because it lends money to the USA Govt. and not to the Chinese Govt.

Okay apart from stable coins and NFT's, what other assets rely and need the Ethereum blockchain to survive?

Can there ever be a independent asset with its own independent decentralized blockchain like bitcoin? Like a dollar stable coin on its own blockchain without requiring a need for Ethereum or Tron to host it or is this simply will turn out to be a CBDC?

And talking of CBDC's can central banks take over the Ethereum and Tron blockchains if they decided for example to make USDC their official CBDC for the USA Govt. when USDC is still hosted on Ethereum?

[dim_mak5]

Or you could even say ETH is what’s keeping stablecoins alive.

I mean, stablecoins like USDT run on different networks (TRON, BNB, and ETH).. but Ethereum is still the most popular and widely used. Without ETH, stablecoins probably wouldn’t even exist in the way we know them now.

People are still investing in ETH.,, they still believe in the project, even with all the bad news about developers or whatever drama’s happening behind the scenes. At the end of the day, it’s the investors that keep a project alive and ETH still has a strong base of supporters backing it.

Yeah I know it is like Eth is the host landlord and USDC and USDT are like tenants in the household that brings in a lot cashflow for the Host to survive right or is it the other way around?

What if assets like stable coins and NFTs leave the Eth blockchain then can Eth still survive? Stable coins are already on Solana but why USDT or USDC not on Cardano yet?

[dim_mak5]

As unrealistic as it is for stablecoins to become illegal, even if it did happen, there would still be alternative options. CDP stablecoins aren’t backed by US dollars and are fairly decentralized. There are also Euro backed and Yuan backed stablecoins. Trump isn’t dumb enough to do something that would hurt dollar adoption and help out competing currencies.

As for whether it would kill Ethereum, the answer is no. You just have to look at Solana and XRP to see that people will still buy altcoins for other reasons unrelated to stablecoins.

So is Dai the only CDP stablecoin out there? I see that Circle a USA entity has issued EURC stablecoin alongside their USDC. Isn't Circle hurting dollar adoption by doing this?

You means altcoins released on the host blockchains such as XRP or solana or people buying altcoins with stablecoins?

[melinoe]

Or you could even say ETH is what’s keeping stablecoins alive.

I mean, stablecoins like USDT run on different networks (TRON, BNB, and ETH).. but Ethereum is still the most popular and widely used. Without ETH, stablecoins probably wouldn’t even exist in the way we know them now.

People are still investing in ETH.,, they still believe in the project, even with all the bad news about developers or whatever drama’s happening behind the scenes. At the end of the day, it’s the investors that keep a project alive and ETH still has a strong base of supporters backing it.

Yep, ETH is still rolling, just like other big caps, because they have a stable footing; they just need the right time to truly shine.

Also, OP - you better answer everybody in one post, you don't need to make a ladder of posts answering everybody separately, you can use quotes for that, or to insert them when you are in the "Post reply" section by scrolling a bit down.

[collecttmaster]

USDT is much more actively used on Tron than Ethereum, so this is probably not true. There are too many scams and risks on Ethereum that many people prefer using Tron, besides it is faster and cheaper. I wonder if there is somewhere good data that compares usage not just issuance. Does anyone know a source?

Honestly I believe if it wasn't for stable coins Eth would be useless by now worth $0. Otherwise what people will use Ethereum for, just NFTs and selling NFTs for bitcoin not for stable coin payments? Smart contracts with what if there are no stable coins at the other end of the contract?

ETH has no advantage over the new generation of coins. It is only there because of age and being the first for these kind of features. Old interests are keeping the price high.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

I think I've read somewhere that someone is trying to deploy a stablecoin on Bitcoin, but I am not sure.

Okay we can see a clearer picture here. West Vs East. West is Ethereum and USDC Vs East Tron and USDT. However USDT Tether lends money to the USA Government so I don't see why Trump would ban USDT as he is getting $billions from Tether. It is like killing one of your main funders. So from this can we safely assume that Tether USDT will remain for years until if democrats win the next USA election with their anti-crypto stance but then again banning USDT is like I said before killing one of the government main sources of income because Tether buys USA Govt. bonds.

USDC is officially regulated and recognised by the USA Government. People in the poorer east need USDT because the dollar is the world reserve currency and their local currencies are not as strong I guess. They could by USDC but they prefer to support Asian Tron over western Ethereum? So in future it will be like 2 global competing economies that is western blockchain vs eastern blockchain for smart contracts but bitcoin is separate from all this as its a store of value but bitcoin can dominate all if it can do smart contracts too making Ethereum and Tron obsolete.

What you mean too many scams on ethereum compared to tron? You mean ethereum has too many smart contracts defi hacks in compared to tron? Which is more decentralized, Tron or Ethereum?

I don't see it as a West vs East thing at all. Ethereum is the worst smart contract chain that currently exists. USDC is also very small and nobody favors it. I have never heard anyone ask or offer to pay me in USDC unless they have no choice. For example if the blockchain that they are on does not have good USDT liquidity. As for the rest of the arguments I think there is zero chance of an USDT ban regardless of who the political leaders in the USA are. The people behind USDT were very wise with their involvement in government treasuries. This will ensure that the USA government will never go after them.

Just look at this data point https://www.crypto-news-flash.com/tether-holds-33-1b-in-treasuries-now-top-7-worldwide/. If they continue to do this they will be unstoppable.

[dim_mak5]

USDT is much more actively used on Tron than Ethereum, so this is probably not true. There are too many scams and risks on Ethereum that many people prefer using Tron, besides it is faster and cheaper. I wonder if there is somewhere good data that compares usage not just issuance. Does anyone know a source?

Honestly I believe if it wasn't for stable coins Eth would be useless by now worth $0. Otherwise what people will use Ethereum for, just NFTs and selling NFTs for bitcoin not for stable coin payments? Smart contracts with what if there are no stable coins at the other end of the contract?

ETH has no advantage over the new generation of coins. It is only there because of age and being the first for these kind of features. Old interests are keeping the price high.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

I think I've read somewhere that someone is trying to deploy a stablecoin on Bitcoin, but I am not sure.

Okay we can see a clearer picture here. West Vs East. West is Ethereum and USDC Vs East Tron and USDT. However USDT Tether lends money to the USA Government so I don't see why Trump would ban USDT as he is getting $billions from Tether. It is like killing one of your main funders. So from this can we safely assume that Tether USDT will remain for years until if democrats win the next USA election with their anti-crypto stance but then again banning USDT is like I said before killing one of the government main sources of income because Tether buys USA Govt. bonds.

USDC is officially regulated and recognised by the USA Government. People in the poorer east need USDT because the dollar is the world reserve currency and their local currencies are not as strong I guess. They could by USDC but they prefer to support Asian Tron over western Ethereum? So in future it will be like 2 global competing economies that is western blockchain vs eastern blockchain for smart contracts but bitcoin is separate from all this as its a store of value but bitcoin can dominate all if it can do smart contracts too making Ethereum and Tron obsolete.

What you mean too many scams on ethereum compared to tron? You mean ethereum has too many smart contracts defi hacks in compared to tron? Which is more decentralized, Tron or Ethereum?

I don't see it as a West vs East thing at all. Ethereum is the worst smart contract chain that currently exists. USDC is also very small and nobody favors it. I have never heard anyone ask or offer to pay me in USDC unless they have no choice. For example if the blockchain that they are on does not have good USDT liquidity. As for the rest of the arguments I think there is zero chance of an USDT ban regardless of who the political leaders in the USA are. The people behind USDT were very wise with their involvement in government treasuries. This will ensure that the USA government will never go after them.

Just look at this data point https://www.crypto-news-flash.com/tether-holds-33-1b-in-treasuries-now-top-7-worldwide/. If they continue to do this they will be unstoppable.

If ethereum is the worst smart contract chain out there then why it has the most dominance according to this link?:

https://defillama.com/chains

USDT dominance is currently 61% and USDC has a strong dominance too according to this link?:

https://defillama.com/stablecoins

But why there is a lot of USDT on Ethereum then, all should return back to Tron right if Ethereum is rubbish.

Or is USDT dominance high because there's a higher yield for it on De-Fi in compared to USDC?

But the final question begs why people choose USDT over USDC when USDC is regulated and the company Circle is a registered security and USDC is officially endorsed by Coinbase who are also on stock market exchange regulated by the SEC and Coinbase is custody of all the bitcoins for the big players like michael saylor and blackrock and such so does this guarantee that coinbase, circle and usdc will never go to $0?

There's thousands of entities and corporations and nation states that buys USA treasuries not just Tether. Russia 1 of them but the USA still went after Russia. Is Tether regulated by recognised bodies like the SEC? Does Tether have the same peace of mind like USDC?

Can the USA Government freeze Tether USA treasuries that they are holding and liquidate sell them and don't pay Tether the bond principal and interest back?

[JeffBrad12]

This is complex topic but I believe there are many ways trump can impose ban to tether like not allowing the use of dollar to peg their USDT and I agree that ETH value will plummet if stablecoin suddenly vanish.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

There are plenty of L2 with its own stable for bitcoin, but never truly get the spotlight because people trust bitcoin much more than those L2 and if they want to do smart contract related activity they go to ETH where liquidity is not scarce compared to L2.

[OgNasty]

It seemed like Ethereum was cooked and the Coinbase came along with Base and reinvigorated things a bit. The fact with ETH is that is has way more value locked on the chain than any other smart chain out there. By a lot. I prefer using Solana over Ethereum, but big money has already chosen ETH. I don’t think it is going anywhere.

[TastyChillySauce00]

Ethereum is a big chain, there are tons of tvl and if there's no traditionally pegged stablecoin people will make delta neutral hedge ones.
Even before the hype of stablecoin ethereum were also having many things going on in their chain.

Remember that there are decentralized stablecoins out there which derive its value from the working of the market such as over collateralization.

[dim_mak5]

This is complex topic but I believe there are many ways trump can impose ban to tether like not allowing the use of dollar to peg their USDT and I agree that ETH value will plummet if stablecoin suddenly vanish.

Otherwise when will bitcoin gets its own stable coin on its own layer 2 to compete with ethereum? Layer 2's none of that sidechains nonsense that leverage no security from layer 1's.

There are plenty of L2 with its own stable for bitcoin, but never truly get the spotlight because people trust bitcoin much more than those L2 and if they want to do smart contract related activity they go to ETH where liquidity is not scarce compared to L2.

If trump bans Tether then they will losing funding from them.

Theres Layer 2's and their Sidechains. Layers 2's are less risky because they leverage the safety and security of their underneath main Layer 1 base chain network. Is there a stablecoin on the bitcoin layer 2 yet like lightning stable coin? Obviously they cant be a stablecoin on the main layer 1 bitcoin network because fees will be expensive plus its going to clutter the main bitcoin network. The bitcoin maxis want their main btc base layer to be clutter free so less storage space in Gb is required to run a node.

[Hispo]

I believe it is not only about the use of Ethereum as a network to transfer value in the form of stablecoins, to be honest. There is a strong sense of reliability when people decide to use Ethereum instead of other networks, because it was the first ecosystem to successfully introduce smart contracts to the world, so naturally, there will be people and institutions who believe Ethereum has the best support, innovation and chance to stay in the top by market capitalization in the long term.
Also, the Ethereum foundation has its headquarters in the west, so as governments in this part of the world realize the importance of cryptocurrencies they will try to give support to those that have their headquarters in their jurisdiction, instead those who are established in adversaries' territory. There is some geopolitics in this business and technological landscape.

[danherbias07]

It just enhances the usage of the Ethereum network because it's where most of the transactions are done, but I highly doubt Ethereum will fall to $0 just because of that. Ethereum has supporters just like Bitcoin, and they will never let it fall to an extent that it won't have any value anymore. I still think it's the King of Altcoins up until now because it never stops integrating other projects into itself.

If ever those stablecoins that you said were banned by anyone, I don't believe it will affect that much. It will affect the whole crypto market because now the exchange is mostly Altcoin or Bitcoin to Stablecoins. It will either be good for the market or it will be for the better, just like the old days.