The synergy between stablecoins, RWA, and Decentralized Finance will drive the re-evaluation of ETH value

Recently, the performance of crypto coins has been good, drawing investors' attention to issues such as stablecoin legislation, Ethereum hotspots, and RWA opportunities. This article will systematically analyze these issues from a long-term perspective, as a supplement to previous reports.

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

1. Data shows the rapid development of stablecoins and RWA

The total market value of stablecoins has reached a historical high of 258.3 billion USD. The US stablecoin bill is progressing, and the Hong Kong stablecoin regulations will take effect on August 1. The US Treasury predicts that if the bill is passed, the market value of stablecoins will rapidly grow to over 2 trillion.

The RWA market has grown from 5.2 billion in 2023 to 24.3 billion, an increase of 460%. It is expected that by 2030-2034, 10%-30% of global assets may be tokenized, with a scale of 40-120 trillion, more than 1000 times the current amount.

Mainstream institutions are actively positioning themselves:

• BlackRock BUIDL Fund AUM $2.86 billion, 95% deployed in ETH
• Securitize has partnered with several institutions to issue $3.7 billion in tokenized products, with 80% on Ethereum.
• Franklin Templeton BENJI Fund AUM is $743 million, 10% in ETH

2. Structural Advantages of RWA

RWA refers to the digitization of real-world assets into on-chain tokens through blockchain. Its advantages include:

1. Programmability: Smart contracts drive the automation of asset management
2. Settlement Revolution: Achieve Instant Settlement, Reduce Risk
3. Liquidity Revolution: Enhancing the Liquidity of Low Liquidity Assets
4. Global Accessibility: Break geographical barriers to expand the investor base

Currently, RWA mainly involves:

• Private lending: $14.3 billion, accounting for 58.8%
• Government bonds: scale of 7.4 billion USD, accounting for 30%
• Stocks: Kraken and others launch tokenized stock trading
• Product: primarily based on gold
• Private Equity: Actively Exploring

3. The Synergistic Effects of Stablecoin-RWA-DeFi

Stablecoins are the foundation of on-chain finance, making currency programmable and decentralized.

The rapid development of RWA is due to institutions exploring compliant integration methods. After the bill is passed, a large number of assets will be on-chain.

Decentralized Finance will play a role in achieving the efficiency and automation of newly on-chain assets, driving innovation in derivatives.

RWA and Decentralized Finance integration case:

1. Securitize connects DeFi through sTokens
2. Ethena's USDtb combines BUIDL to achieve a stable minimum yield.

4. ETH is the mainstream choice for institutions

The market capitalization of RWA on ETH is 7.5 billion USD, accounting for 58.41%. Reasons institutions choose ETH:

1. Highest security and stability
2. Mature DeFi ecosystem and liquidity
3. Highly decentralized, global business reach

Etherealize believes that ETH is the foundational asset of the new financial system, with multiple functions. The revaluation process of ETH is accelerating:

1. Institutions widely adopt ETH infrastructure
2. Increased demand for ETH staking
3. ETH hoarding competition within the ecosystem
4. ETH has become the preferred reserve asset for institutions.

In summary, ETH is not the only choice for institutions, but it is currently the optimal solution for large-scale asset tokenization. Combining data and recent trends, the trend of ETH being reassessed is evident.