Don't worry, the public chains of USDC and USDT won't shake Ethereum.

作者：Blue Fox Notes

Someone asked whether stablecoin issuers like Circle (USDC) and Tether (USDT) building public blockchains would cause Ethereum to decline. I initially had no intention of responding to this, but several friends privately messaged me about it. So, let’s have a brief discussion.

First, the conclusion: Ethereum will not decline because of this. Overall, it will still benefit.

In the future stablecoin battle, the most important factor is the distribution channels at the front end—Meta, MrBeast and similar creators (Tom Lee’s Bitmine has invested $200 million), Robinhood, Aave, Polymarket, Lighter, Uniswap, exchanges, wallets…. Stablecoin issuers are not the strongest in the entire chain, and the L1 chains they build do not inherently have network effects.

Big players like Meta won’t support only Circle’s chain but will support multiple chains; channels like MrBeast, which are expected to deeply integrate with the Ethereum ecosystem later, will prioritize supporting Ethereum; Robinhood is built on Arbitrum (Ethereum ecosystem), and may later develop its own independent L2; Polymarket also plans to build an Ethereum L2…

Where users are involved, that’s where network effects are generated. As long as Ethereum’s L1/L2 fees are low enough and speed is fast enough (within the same level), its security and decentralization advantages are unmatched. Currently, Ethereum L1 is moving toward 10,000 TPS, and L2s are aiming for over a million TPS. Future fees and speeds won’t be issues.

Issuers building their own chains won’t lead to large-scale traffic migration; instead, they might eventually become part of Ethereum L2.

Arc is Circle’s developed L1 chain supporting USDC as native gas, sub-second settlement, and institutional privacy/compliance, expected to launch later this year. Even so, USDC is still issued across multiple chains, including Ethereum and Solana, with Ethereum still holding the majority share. As for how it will develop upon launch, many uncertainties remain. Tether’s USDT is even more multi-chain.

All stablecoin issuers are building L1 chains, which will create competitive pressure among them. It’s difficult to operate on each other’s chains, but the Ethereum ecosystem remains inclusive and will continue to be the most important chain for hosting different stablecoins.

Multi-chain issuance of stablecoins is the norm. This means that even if ARC launches, it will only be a supplement, not a replacement. It will have its own institutional trading scenarios, but the market share it can capture ultimately depends not only on stablecoin issuers but also on distribution channels and high-frequency applications. For distribution channels, fees, speed, and security are all crucial, and currently, Ethereum offers the best balance among these three. Distribution channels cannot ignore Ethereum.

Looking at the current market share of stablecoins, Ethereum dominates and continues to grow.

As of February 2026, the total stablecoin market cap is approximately $3.1–3.2 trillion (DefiLlama/TRM Labs data), with:

• Ethereum: 52-60% (~$1.53–1.65 trillion), up 40% from 2025 (from $115B to $153B). It holds the largest share, handling over half of stablecoin activity.

• Tron: 25-30% (~$830–840 billion), USDT dominates, but growth has slowed (fees increased to $0.50 per transaction).

• Solana: 4.5% (~$130 billion), USDC accounts for 77%, benefiting from low fees (<$0.01 per transaction).

• Others: BNB Chain grew 133% in 2025 but has a small share; L2s like Arbitrum and Base account for about 100%, with the Ethereum ecosystem (L1 + L2) exceeding 70%.

Additionally, by currency, USDT is about $1,840 billion (59%), USDC about $750 billion (24%). USDC is growing rapidly (up 6.39% as of February 2026), mostly on Ethereum.

In terms of transaction volume, stablecoin transfers exceeded $10.5 trillion in January 2026 (a new high). Ethereum handles most institutional and DeFi traffic (projected over $40 trillion for the year), far surpassing PayPal ($20 trillion) and approaching Visa ($15 trillion). These are network effects—do you think the birth of a stablecoin chain will automatically cause users to migrate?

Ethereum still has the largest developer ecosystem, the most vibrant DeFi ecosystem, and stable operation without outages, allowing institutions to place their trading scenarios on what could be a potentially unstable centralized L1 chain?

Ethereum’s competitors have always been themselves, not other chains. As long as its fees and speed are comparable to any other L1 chain, its security and decentralization advantages will be unmatched.

Beyond stablecoins, Ethereum’s future includes asset tokenization, DeFi, and AI agent economies—these are major trends. The stablecoin issuers’ L1 chains are not enough to cause Ethereum to decline.

By the way, what’s the latest on Tether’s support for Plasma chains?