Many people see Vitalik Buterin’s emphasis on Ethereum as the “world ledger” as a new strategic shift, but in fact, this transformation was completed the moment EIP-1559 went live. The 50% exclusive share of stablecoins on Ethereum only reinforces Ethereum’s positioning as a financial settlement layer. Let me elaborate on this:

1) The core of EIP-1559 is not to reduce Gas fees, but to redefine the value capture mechanism of the Ethereum mainnet, establishing a new model in which Ethereum captures value not through increased gas consumption related to transaction volume.

Previously, all transactions (DeFi, NFT, GameFi, etc.) were congested on the mainnet, which resulted in significant ETH Gas consumption. Data shows that in 2021, the average daily Burn of ETH was nearly thousands. At that time, the Ethereum mainnet was also heavily congested, and when Layer 2 had to submit batch data for verification on the mainnet, they had no choice but to join the Gas War, which was costly and unpredictable.

But EIP-1559 changed the game: after introducing a predictable Base fee mechanism, the batch submission costs of Layer2 on the mainnet became stable and controllable. This directly lowered the operational threshold for Layer2, allowing more Layer2 to rely solely on Ethereum for final settlement.

On the surface, EIP-1559 seems to facilitate Layer 2, but in reality, it has deeply transformed the value capture logic of Ethereum: shifting from “consumption-based growth” relying on high-frequency trading on the mainnet to “tax-based growth” dependent on Layer 2 settlement demand.

You see, previously users paid directly to the Ethereum mainnet for computational services, which was a buyer-seller relationship. Now Layer 2 earns transaction fees from users, but must periodically “contribute” batches of data to the mainnet and Burn ETH, thus establishing a tribute relationship.

This is very similar to how banks handle daily operations, but large interbank settlements must be confirmed through the Central Bank system. The Central Bank does not directly serve ordinary users, but all banks must “pay taxes” to the Central Bank and accept regulation.

This is a typical representation of the “World Ledger” positioning.

2) According to DeFiLlama data, the total market capitalization of stablecoins worldwide has exceeded $250 billion, with Ethereum accounting for 50% of the share, and this proportion has increased since the launch of EIP-1559. Why is Ethereum able to attract such capital? The answer is actually very simple: irreplaceable security premium.

Specifically, USDT has a total of 62.99 billion dollars on Ethereum, while USDC has 38.15 billion dollars. In comparison, the total amount of stablecoins on Solana is only 10.7 billion dollars, and BNB Chain is just 10.4 billion dollars, which together are less than a fraction of what is on Ethereum.

The question arises, why do stablecoin issuers choose Ethereum?

It is definitely not because it’s cheap, nor because it’s fast, but simply because the economic security provided by nearly one hundred billion dollars worth of staked ETH is unmatched. The cost of attacking Ethereum is absurdly high, which is a very important consideration for institutions managing hundreds of billions of dollars in assets.

When there is a large amount of stablecoin capital accumulated, the Ethereum ecosystem forms a self-reinforcing growth flywheel effect:

The more stablecoins there are → the deeper the liquidity → more DeFi protocols choose Ethereum → this generates more demand for stablecoins → attracting more capital inflow.

From this perspective, the large-scale aggregation of stablecoins on Ethereum is actually the result of global liquidity voting with their feet, as well as market confirmation of its positioning as a world ledger.

3) Once the Ethereum mainnet focuses on being the settlement layer at a “Central Bank” level, the strategic positioning of the entire Ethereum ecosystem becomes very clear: Base, Arbitrum, and Optimism are responsible for high-frequency trading, while the Ethereum mainnet concentrates on final settlement, with clearly defined and efficient division of labor. Moreover, every settlement returning from Layer 2 to the mainnet will continue to burn ETH, making this deflationary flywheel spin faster and faster.

You see, when it comes to this, many E guardians will be heartbroken. If that’s the case, why hasn’t layer2 contributed to deflation for the Ethereum mainnet, but instead has become a “vampire” that overdraws the value of the Ethereum mainnet?

The actual data is harsh: the once thriving Ethereum mainnet with a daily Burn of several thousand ETH is no longer in existence. Now? The daily Burn amount has shrunk significantly, sometimes even dropping to less than a few hundred ETH. Meanwhile, Arbitrum’s daily transaction volume often reaches millions, and Base has become a super profitable machine thanks to the traffic from Coinbase, while Optimism is also making a fortune.

Where does the problem lie? Users have all migrated to Layer 2, and the mainnet has become a “ghost town.” Layer 2 collects millions of dollars in fees every day for themselves, but the “protection fee” given to the mainnet is pitiably small.

However, this issue does not shake the established position of the Ethereum world ledger. The large accumulation of stablecoins, nearly 100 billion dollars in security guarantees (28% of the supply is staked), and the largest DeFi ecosystem in the world all demonstrate that capital chooses the settlement authority of Ethereum rather than the transactional prosperity of the layer 2 ecosystem.

Nowadays, Vitalik Buterin seems to be aware of this issue and is trying to enhance the performance of the Ethereum mainnet, as he does not want layer 2 to become a burden on the development positioning of Ethereum’s overall world ledger.

But ultimately, the success or failure of layer2 is not really related to the positioning of the Ethereum world ledger.

Vitalik now emphasizes the “world ledger”, which seems more like an official confirmation of an established fact. EIP-1559 is that historic turning point, and from that moment on, Ethereum is no longer the “world computer”, but rather the “world Central Bank”.

In other words, if you agree that the upcoming Crypto dividends represent a fusion of on-chain DeFi infrastructure and TradiFi traditional finance, then Ethereum’s positioning as the “world Central Bank” is sufficient to solidify its status, while the prosperity of layer2 is fundamentally unimportant.

Of course, if you still think that Ethereum must wait for the strong rise of the layer2 ecosystem to emerge, you can ignore this analysis, as if I never said it.

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