When stablecoins start to create chains, is there still a chance for Ethereum?

Author: Biteye Core Contributor Viee

Editor: Denise, core contributor of Biteye

In the past few years, stablecoins have been the most “unobtrusive” protagonists in the cryptocurrency market, yet their scale continues to grow. Cross-border remittances, trading settlements, compliance pilots… stablecoins remain an indispensable gear in the flow of crypto capital.

This year, a more milestone change has occurred: stablecoin issuers are no longer satisfied with “standing on the chain” but have begun to build their own chains. In August, Circle announced the launch of Arc, followed closely by more details released by Tempo, led by Stripe. Two giants that have been deeply involved in stablecoins for many years have almost simultaneously taken this step, and the logic behind it is intriguing.

Why do stablecoins need their own chain? In this seemingly “B-end dominated” game, do retail investors still have a chance? When stablecoins control their own “money path”, do general public chains like Ethereum and Solana still hold enough say?

This article will explore from four perspectives:

1. What is a stablecoin public chain, and how does it differ from traditional public chains?

2. Comparison of design paths for representative projects.

3. Will stablecoin public chains pose a threat to Ethereum?

4. Opportunities that ordinary users may have to enter.

01. Stablecoin public chain: A path closer to the “settlement layer”.

If Ethereum, Solana and other public chains focus on decentralized applications, then stablecoin public chains are closer to the settlement layer.

They have several distinct characteristics:

• Stablecoins are like Gas: transaction fees are stable and predictable, eliminating the need to hold volatile assets to pay for “tolls”.
• For payment and settlement optimization: the goal is not “universal”, but “stable and easy to use”.
• Built-in compliance module: facilitates integration with banks and payment institutions, reducing grey areas.
• Design around the demand for “money”: cross-currency settlement, foreign exchange matching, unified accounting units, a clearing system that is closer to the real world.

In other words, stablecoin public chains are more like a vertically integrated model, controlling key aspects from issuance and clearing to application as much as possible. The cost is to bear the initial cold start pressure, but in the long run, it can achieve economies of scale and gain a voice.

02, five representative chains have taken different paths.

1、Arc@arc: The first self-owned public chain of Circle

As the world’s second largest stablecoin issuer, it is not surprising that Circle launched Arc. Although the market size of USDC is huge, the transaction fees are subject to the fluctuations of Ethereum or other public chains. The emergence of Arc is precisely Circle’s attempt to build its own “settlement layer.”

There are three core points in the design of Arc:

• USDC as Gas: Transparent fees, no exchange rate risk.
• Fast transactions, stable settlements: We promise to confirm transactions within 1 second, suitable for cross-border payments and large-scale settlements.
• Optional privacy feature: Provides necessary financial privacy for enterprises or institutions under the premise of ensuring compliance.

This means that Arc is not only a technological attempt by Circle but also a key step towards becoming a financial infrastructure provider.

2. Tempo@tempo: “Payment Priority” Public Chain

Tempo is jointly incubated by Stripe and Paradigm, and the core logic is straightforward: after stablecoins go mainstream, a truly suitable infrastructure for payments is needed. Traditional public chains either have unstable fees, insufficient performance, or an overly “crypto-native” experience, making it difficult to support global settlement flows. Tempo aims to fill this gap.

Therefore, Tempo has a few distinctive features from the design.

• Any stablecoin can be used as Gas: Stablecoin swaps are achieved through the built-in AMM.
• Low fees & predictability: Equipped with payment channels, notes, and whitelist features, closer to real payment systems.
• Extreme Performance: Targeting 100,000 TPS, sub-second confirmation, suitable for scenarios such as salaries, remittances, and micropayments.
• EVM Compatible: Based on the Reth architecture, low migration cost for developers.

Its partners are also quite substantial, including Visa, Deutsche Bank, Shopify, OpenAI… This makes Tempo more like an open dollar payment network rather than just an affiliate of a single stablecoin. If successfully implemented, it could even become a prototype for an “on-chain payroll system.”

Although Tempo focuses on “payment first,” its degree of decentralization has also sparked some discussions. Currently, Tempo's design leans more towards the attributes of a “consortium blockchain” rather than a “public blockchain,” and the nodes are not completely open, resulting in a somewhat weaker degree of decentralization.

3、Stable @stable: The main arena for USDT

Stable is a payment chain specifically designed for USDT, supported by Bitfinex and USDT0, with the goal of facilitating smoother transactions of USDT in daily financial activities.

In design, Stable did a few things:

• USDT Native Gas: Fees are paid directly in USDT, and peer-to-peer transfers are completely gas-free.
• Second-level confirmation: balancing small payments and large capital flows.
• Enterprise-level features: including batch transfer aggregation and compliant privacy transfer.
• Consumer experience: Supporting wallet interface with bank cards and merchant payments.
• Developer-friendly: Compatible with EVM and provides a complete SDK

The key word for Stable is implementation, focusing on how to make USDT more naturally integrated into everyday scenarios such as cross-border remittances, merchant acquiring, and institutional clearing.

4. Plasma @PlasmaFDN: Bitcoin Sidechain

Unlike Stable, Plasma has chosen a different path. As a sidechain of Bitcoin, it relies on the security of BTC while focusing on stablecoin payments.

In design, Plasma mainly has the following features:

• Bitcoin Native Bridge: BTC non-custodial cross-chain entry into the EVM environment, directly participating in the stablecoin ecosystem.
• USDT zero transaction fee transfer: Completing USDT transfers for free is its biggest selling point.
• Custom Gas Tokens: Developers can choose to pay with stablecoins or ecosystem tokens.
• Optional privacy features: Adapted for salary distribution and institutional clearing.
• EVM Compatible: Based on the Reth architecture, developers have low migration costs.

The public sale of Plasma officially started in July, with the token being $XPL. The final total subscription amount exceeded 373 million USD, with oversubscription reaching more than 7 times. The market enthusiasm has already given it an early boost.

5. Converge @convergeonchain: The Convergence of RWA and DeFi

The previous few chains essentially revolve around “stablecoin clearing and payment.” Converge's ambition is different; its goal is to bring RWA and DeFi onto the same chain.

In terms of design logic, Converge focuses on three key points:

• High performance: block generation in hundreds of milliseconds, pushing performance limits in collaboration with Arbitrum and Celestia.
• Native Gas for Stablecoin: USDe and USDtb are used as transaction fees.
• Institutional-grade security: Additional protection provided by the ENA network (CVN).

In summary, what Converge aims to solve is “how to safely and efficiently bring in large funds.” Its partners include familiar DeFi protocols such as Aave, Pendle, and Morpho, and it will also support the integration of RWA assets like Securitize.

03. Different starting points, common direction

From Arc to Tempo, from Stable and Plasma to Converge, although the approaches differ, the core issue they aim to address is quite consistent: how stablecoins can truly integrate into the daily financial cycle. Arc and Stable focus on the controllability of their assets, Tempo and Plasma emphasize multi-coin neutrality, while Converge directly targets institutions and RWA. The difference lies in the path, but the common goal is to make transfers more certain, liquidity smoother, and compliance more natural.

Along this main line, the future of stablecoin public chains can generally be seen in three trends:

• Compliance and Institutionalization: Future stablecoin public chains will focus more on settlement certainty and compliance interfaces. Projects like Arc and Stable are working hard to become the clearing layer that banks and payment institutions can directly connect with.
• Challenges to traditional payments: Chains like Tempo, designed to be “multi-currency neutral,” pose alternative pressure on Visa and Mastercard due to their low cost and global reach characteristics.
• Market Landscape Restructuring: Currently, Circle and Tether occupy nearly 90% of the stablecoin market share, creating a near-duopoly. However, “stablecoin neutral chains” like Tempo are breaking this pattern, and in the future, it may lead to a multipolar coexistence.

04. How will stablecoin chain creation reshape the public chain landscape?

The most direct question regarding the issuance of stablecoin issuers creating their own chains is whether they will impact general-purpose public chains like Ethereum and Solana?

Stablecoin chains are naturally born for the “money path” and are indeed more suitable than ETH mainnet or Solana for high-frequency but low-risk businesses such as cross-border remittances and salary payments. The impact on TRON, in particular, may be more direct. TRON's stablecoins mainly come from USDT, accounting for over 99%, and it has already become the largest public chain for USDT issuance. However, if the Stable Chain promoted by Tether matures gradually, TRON's biggest competitive advantage will be weakened.

However, there are also viewpoints that argue that these “payment-specific chains” do not truly qualify as blockchains in the genuine sense. This is because if complete decentralization is to be achieved, it becomes inevitable for various unrelated projects and tokens to flood in, resulting in congestion and performance degradation; but if the focus is solely on payment, it will either be as functionally simple as Bitcoin, capable only of transfers, or be partially centralized, controlled by a small number of institutions managing the nodes. In other words, it is difficult to balance both “decentralization” and “payment efficiency.”

This also means that the positioning of Ethereum and Solana is actually quite secure. The former relies on security and composable general finance to accumulate a developer ecosystem, while the latter has its own niche in high performance and user experience. Ultimately, the competitive landscape is more likely to see stablecoin chains handling deterministic settlements, while ETH/SOL retains open innovation.

05. Retail Investor Perspective: Where are the Opportunities?

To be honest, this round of opportunities is not friendly to retail investors' “direct earnings.” Compared to previous public chains, stablecoin public chains are more oriented towards the “B end,” involving payment, clearing, and custody systems.

But there are still several entry points worth paying attention to:

• Participate in ecological incentives: New blockchain cold starts are often accompanied by bounty programs, developer subsidies, and trading mining, which may lead to similar activities in the future.
• Node Staking: More technically skilled players can pay attention to node validation. For example, Converge requires staking ENA to participate.
• Testnet: Many projects will airdrop rewards to early users, so it's worth paying attention to the testnet. For example, ARC may launch its public testnet this autumn, and the Stable, Plasma, and Tempo testnets are already online.
• Long-term allocation: If you are optimistic about the narrative of “stablecoin public chains,” you might consider longer-term investments, such as focusing on related stocks like Circle and Coinbase.

It is particularly worth mentioning Plasma. During the public sale in July, the token $XPL was oversubscribed by 7 times, with a total amount exceeding $370 million. Subsequently, there was an airdrop event in collaboration with Binance, which was snatched up within an hour. Even in a relatively “institutionalized” track, early retail investors still had the opportunity to reap benefits.

06, Conclusion

Stablecoin public chains will not disrupt the crypto market overnight. Their changes occur more behind the scenes, such as shorter settlement paths, more stable transaction fees, and smoother regulatory interfaces.

On the surface, these seem to lack the “sexiness” of a narrative, but at the infrastructure level, they are gradually building up the “water, electricity, and coal” of stablecoins. When we shift our perspective from “coin price” back to “how the money flows,” the logic becomes clearer:

• Who can guarantee the certainty of settlement;
• Who can provide stable cross-currency liquidity;
• Who can connect the real payment scenario.

Stablecoin public chains are likely to be the most solid narrative in the next bull market. If any projects can truly deliver on these three things, it will not just be a “public chain”; it may become the infrastructure of the next generation of crypto finance.