The Rise of Stablecoins: From Bitcoin’s Roller Coaster to Ethereum’s Status Quo

Stablecoins: The New Kids on the Blockchain

Just a few years back, the notion of stablecoins being a pillar in the cryptocurrency landscape was about as likely as my cat doing the Macarena. In 2016, we were puffing on the dwindling supply of 11 stablecoins, and by 2018, that number barely crept up to 66. Fast forward to today, and we’ve got 66 stablecoins out there with another 134 in the works! Talk about a glow-up!

What’s Shifting Underfoot?

By 2019, 50% of stablecoins were still hanging out on Ethereum, but something was brewing. Blockchain 3.0s like Polkadot and HashGraph emerged, and they aren’t just pretty faces; they are aiming to shake things up. With decentralized finance (DeFi) frameworks like Compound and MakerDAO popping up, it’s a veritable buffet for stablecoin developers to consume!

Decentralized Finance: The New Playground

• Compound, MakerDAO, and Equilibrium are more than just fancy names; they’re revolutionizing stablecoin assets.
• Developers are no longer held back—innovative DeFi applications are emerging to challenge the mighty Ethereum.

Why Ethereum Still Holds Sway

Despite the swift influx of new platforms, Ethereum is still the A-lister in the stablecoin gala. Why? Well, for starters, it’s like the Starbucks of blockchains—everyone seems to gravitate toward it. Almost 93% of the stablecoin market is tethered to Ethereum’s Tether (USDT)! That’s right; the mighty USDT, along with USDC and GUSD, reigns supreme!

Built-in Logic and Regulation

You won’t find built-in regulatory measures just anywhere, but Ethereum has them covered—which is basically why it became the reigning champ early on. Ethereum’s smart contracts are audited by overly diligent watchdogs who might as well have capes and masks, protecting traders from security breaches.

A Future Beyond Ethereum?

If the last couple of years are any indication, we’re watching Ethereum share its crown. More stablecoin projects are looking elsewhere—whether it be Bitshares, Stellar or even Bitcoin. Projects like EOSDT and Carbon are vying for a place in the stablecoin hall of fame, raising eyebrows and making waves.

The Bandwidth Brouhaha

With Ethereum barely scraping by at around 25 transactions per second, it’s starting to look like a bit of a slowpoke. News flash: We need more speed! Credit card companies are running laps around Ethereum with thousands of transactions occurring daily. If Ethereum can’t step up its game (ahem, dear Vitalik Buterin, we’re looking at you), we might see more projects ditching it for a speedier system.

Looking Ahead: The Next Era of Stablecoins

As 2020 rolls in, expect stablecoin use to surge. The crypto community is waking up to the endless possibilities these digital coins present. The total trading volume that spiked to over $82 billion in 2018 is just the tip of the iceberg! With an increased appetite for stablecoins and their use in DeFi and DApps, we’re entering a fierce competition phase!

What to Watch For

• Cross-chain functionality will become vital—projects need to break out of Ethereum’s confines.
• Expect creative solutions as the market matures—who will rise and who will fall in this unpredictable landscape?
• Ethereum vs. EOS: The rivalry is on, but who’s going to wear the crown at the end of this race?

It’s a wild and exciting era we find ourselves in, but if the past few years are any indication, the evolution of the stablecoin market is far from over!