Stablecoin, RWA, and Decentralized Finance: The Three Catalysts for ETH Value Reevaluation

Recently, the performance of crypto coins has been remarkable, prompting investors to reflect on several key issues, including the market increment after the stablecoin bill is passed, the reasons behind the surge of Ethereum-related stocks, the relationship between RWA opportunities and Ethereum, as well as the logic behind the long-term optimism for ETH. This article will systematically elaborate on these issues from a fundamental logic and long-term perspective.

The rise in ETH prices is not driven by individual institutions, but rather a collective choice of mainstream institutions as they reshape their strategies. The critical point of this trend change is approaching.

1. Data Interpretation

The stablecoin market has developed beyond expectations, with a total market value reaching a historic high of $258.3 billion. The U.S. "Genius" bill has passed the Senate vote and is moving to the House stage. Hong Kong's "Stablecoin Regulation" will take effect on August 1. If the U.S. stablecoin bill passes, the market value of stablecoins is expected to exceed $2 trillion in the coming years.

Asset tokenization ( RWA ) market is growing rapidly, increasing from $5.2 billion in 2023 to the current $24.3 billion, a growth rate of 460%.

Currently, the total market value of traditional finance exceeds 400 trillion, the total market value of the crypto market is 3.3 trillion, the total market value of stablecoins is 0.25 trillion, and the total market value of RWA is 0.024 trillion. It is expected that by 2030-2034, 10%-30% of global assets may be tokenized, reaching a scale of 40-120 trillion.

2. A New Understanding of RWA

RWA(Real-World Assets) refers to the digitization of real-world assets through blockchain technology and their mapping as tokens or assets on the blockchain. Broadly, RWA corresponds to the on-chain and tokenization of any asset beyond blockchain-native assets, allowing for the complete completion of rights attribution, circulation, and settlement through blockchain.

Tokenization has the following structural advantages:

1. Programmability: Achieve asset management automation through smart contracts.

2. Settlement Revolution: Achieve instant peer-to-peer settlement and reduce counterparty risk.

3. Liquidity Revolution: Improve the liquidity of traditional low liquidity assets.

4. Global Accessibility: Breaking down geographical barriers to expand the investor base.

The main asset classes currently being tokenized include:

• Private Lending: Largest in scale, reaching 14.3 billion USD.
• Government bonds: Traditional institutional entry point, with a scale of 7.4 billion dollars.
• Stocks: Accelerating realization, multiple exchanges are launching tokenized stocks.
• Product: mainly based on gold.
• Private Equity: Actively exploring.

3. stablecoin-RWA-Decentralized Finance ecosystem

Stablecoins are the foundation of traditional finance integrated on the chain, making currency programmable and decentralized. The rapid development of RWA is due to institutional compliance exploring new integration methods. After a large number of assets are on the chain, DeFi will play a role in integrating new on-chain assets with mature DeFi protocols.

RWA and Decentralized Finance integration cases:

1. Securitize connects DeFi systems through sTokens, such as the collaboration between BlackRock BUIDL and the Euler protocol, and Apollo ACRED and the Morpho protocol.

2. Ethena's USDtb fusion BUIDL achieves a stable minimum yield.

4. ETH as a Mainstream Choice for Institutions

Data shows that ETH remains the main public chain for institutions to tokenize assets, accounting for 58.41% of the total scale. The main reasons institutions choose ETH are:

1. The highest level of security.

2. The most mature Decentralized Finance ecosystem and liquidity.

3. Highly decentralized and global business reach.

Etherealize believes that ETH is a new category of asset, a digital oil, powering, securing, and reserving the new financial system of the internet. The versatility of ETH makes it difficult to value using traditional methods, but it also means greater long-term potential.

The reason ETH lags behind BTC is that its narrative has not yet been widely accepted by institutions. However, the process of ETH repricing is accelerating:

1. Institutional demand surges.
2. The demand for native crypto yield is accelerating.
3. Strategic accumulation of ETH.
4. ETH becomes an institutional asset.

In summary, although ETH is not the only choice for institutions entering the blockchain, it is currently the optimal solution for large-scale asset tokenization. Combined with data, examples, and underlying logic, a trend of renewed emphasis on ETH is taking shape.