Ethereum Surpasses Bitcoin as Global On-Chain Settlement Layer, Analyst Claims

Advantage Blockchain’s Alec Beckman argues Ethereum is becoming the dominant global settlement layer for on-chain assets, fulfilling a role initially intended for Bitcoin.

Bitcoin was created as a decentralized alternative to traditional finance, aiming to be a peer-to-peer electronic cash system.

Bitcoin’s price volatility and slow transaction processing, alongside limited flexibility, have hindered its use as everyday cash.

Bitcoin now functions primarily as a digital store of value instead of a transactional currency.

Ethereum’s Programmability Enables Stablecoin Success

Ethereum’s design allows it to realize Bitcoin’s initial ambitions, particularly through its programmable features.

Stablecoins on Ethereum, such as USDC and USDT, facilitate high volumes of cross-border peer-to-peer transactions without banks.

These stablecoins provide the stable digital currency that Bitcoin’s white paper envisioned, without the price fluctuations.

Ethereum’s Transaction Volume Rivals Major Networks

On-chain data indicates stablecoin transactions on Ethereum and its layer-2 networks now compete in volume with major credit card networks.

In regions with unstable economies or limited financial access, Ethereum stablecoins are used for remittances, payroll, savings, and commerce.

Ethereum enhances fiat currency utility through composability, programmability, and global access within a decentralized system.

Ethereum Expands into Asset Tokenization and Yield Generation

Ethereum’s functions extend beyond payments to broader infrastructure.

Real-world asset (RWA) tokenization is growing on Ethereum, with institutions like BlackRock and Franklin Templeton issuing assets such as treasury bills and private credit on the platform.

These institutions are developing on Ethereum, not Bitcoin.

Ethereum also supports native yield generation through staking, offering returns for network participants, unlike Bitcoin’s non-yielding nature, making it attractive to institutions seeking on-chain cash flow.

Bitcoin as Value Anchor, Ethereum as Settlement Layer

Bitcoin remains a digital store of value, but its practical use is restricted.

Ethereum is emerging as the key settlement layer for on-chain assets.

Despite Bitcoin’s wider public recognition, Ethereum’s core usage and institutional adoption are steadily increasing.

Ethereum fulfills Bitcoin’s original vision of a decentralized, global, programmable financial system—digital cash—at scale.

Bitcoin initiated this shift, but Ethereum is scaling its implementation.

Also Read: Veteran Trader Peter Brandt Denounces Ethereum as “Worthless Junk”