GENIUS Act Sparks a Stablecoin Surge on Solana — Is Ethereum Losing Its Lead or Just Sharing the Stage?

Stablecoins are back in the spotlight. After a prolonged period of incremental growth, the market’s dollar-pegged lifeblood is expanding at a brisk clip — and the network seeing the fastest acceleration is not the usual suspect. According to a recent analysis shared by Bitwise Investments analyst Danny Nelson, Solana has recorded the most rapid increase in circulating stablecoin supply since the passage of the so-called GENIUS Act. That legal milestone, signed on July 18, 2023, clarified how stablecoins can be issued and distributed in the U.S., removing a major cloud for payment-focused deployments.

Solana’s Stablecoin Base Jumps in the Wake of Policy Clarity

Solana now ranks as the third-largest chain by hosted stablecoin value. What’s new is the pace: in the three months following the GENIUS Act, circulating supply on Solana expanded by roughly 40%, lifting its on-chain stablecoin market cap from about $10 billion to near $13.9 billion, based on on-chain analytics from rwa.xyz. In growth terms, that puts Solana in a category of its own among major networks over the same window.

To be clear, Ethereum remains the industry’s anchor for dollar tokens by absolute size, hosting on the order of $172.4 billion in stablecoins. But the growth rates diverged post-GENIUS. Ethereum’s stablecoin base increased at a slower clip — around 27% in the period highlighted — with several other stablecoin-oriented ecosystems such as Base, Hyperliquid, and Arbitrum growing more modestly still. Meanwhile, Tron, the number-two chain by stablecoin share, saw supply slip by almost 4%.

Why the Money Is Moving: Fees, Finality, and Payments UX

Stablecoin adoption lives or dies on two messy, real-world constraints: latency and cost. Payment rails must feel instant and nearly free to end users, especially for high-frequency, low-ticket volumes (think remittances, commerce, and settlement between fintechs). Solana’s low fees and swift finality reduce slippage in consumer experiences, point-of-sale flows, and merchant reconciliation. Nelson’s argument is straightforward: once the regulatory fog thinned, enterprises and financial institutions had a clearer path to pilot stablecoin use cases — and many opted to test where the experience is fast and cheap by design.

Thirty Days of Acceleration: A Steeper On-Ramp

The last month has amplified the trend. Over roughly 30 days, Solana’s circulating stablecoin supply increased by around $3 billion (about 25%). Ethereum also advanced but at a more measured pace, with an approximate 8% lift over the same span. In a market primed for payments adoption and institutional integrations, those deltas matter: they suggest where new pilots are springing up and which rails are winning incremental flow.

ETF Chatter and the Liquidity Flywheel

Beyond payments, markets are watching a separate potential catalyst: the anticipated rollout of Solana spot ETFs in Q4. The narrative here is not about stablecoins directly, but about a broader liquidity flywheel — new investor access draws attention to the ecosystem, which can spill into developer activity, tooling, and yes, more payment trials. Historically, asset-class on-ramps and well-telegraphed products (such as trusts and exchange-traded vehicles) tend to raise mindshare even before launch. As of the most recent checkpoints referenced in the analysis, SOL was trading near $230.60, with participants debating how much ETF speculation is already priced in.

The Counterpoint: Scale Still Belongs to Ethereum

Speed is only half the story. Critics of the “Solana overtaking Ethereum” narrative emphasize that Ethereum still hosts the majority of all stablecoins. One crypto investor highlighted a back-of-the-envelope split of roughly 54% market share for ETH versus ~5% for Solana. On those numbers, Ethereum’s base remains an order of magnitude larger. The takeaway: percentage growth on a smaller denominator can look dramatic, but absolute dollars still concentrate where the deepest liquidity, tooling, and counterparties live.

A second rebuttal leans on RWA (real-world assets) and TVL. Over the same 30-day window, Ethereum’s stablecoin TVL reportedly climbed by about $10 billion, compared with Solana’s increase of around $2.4 billion. For RWA-specific TVL, the gap was wider: approximately $1.9 billion added on ETH versus roughly $190 million on SOL. If stablecoins are a gateway to tokenized T-bills, money-market funds, and other yield-bearing instruments, Ethereum’s deeper pipelines and institutional integrations remain a powerful moat.

What the GENIUS Act Actually Changed

Before GENIUS, issuers and platforms wrestled with fragmented expectations across agencies and a patchwork of state-level guidance. The act’s passage established clearer guardrails for issuance, distribution, and reserve practices. For payments-first products, that clarity can be the difference between a carefully scoped pilot and a hard legal “no”. It also narrows perceived compliance risk for banks and fintechs seeking to route settlement through tokenized dollars — precisely the use case where Solana’s capital efficiency can shine.

Solana vs. Ethereum: A Tale of Two Product Stories

Solana’s pitch is elegant: consumer-grade throughput at negligible fees. That makes it well suited for high-velocity, low-value payments, creator payouts, and in-app flows. The developer experience has matured, tooling has improved, and payment-centric projects have multiplied, yielding a network that feels “ready for checkout.”

Ethereum’s pitch is different: it is the general-purpose settlement layer with the richest set of DeFi, RWA integrations, compliance-aware infrastructure, and a gravity well of institutional relationships. Even where activity migrates to L2s, assets typically settle back to Ethereum, and the ecosystem’s security and auditability remain major selling points for enterprises.

Who’s “Winning” Depends on Your KPI

Speed of growth: Solana currently leads on rate of change for circulating stablecoins.
Absolute scale: Ethereum dominates by total outstanding stablecoin value and RWA footprint.
Payment UX: Solana’s low fees/finality give it an edge for retail-like flows and micro-settlements.
Institutional pipelines: Ethereum’s RWA rails, custody options, and compliance stack keep it ahead for larger tickets.

Risks That Could Upend the Trajectory

Regulatory reinterpretation or new guidance that changes reserve, disclosure, or distribution rules could slow issuer momentum anywhere.
Throughput shocks or reliability incidents on fast chains can quickly cool payment pilots if user experience degrades during peaks.
Liquidity fragmentation across L1s/L2s may blunt network effects if bridges and cross-chain settlement remain clunky or risky.
ETF disappointment: If anticipated products arrive with tighter gates, lower volumes, or delays, the halo effect could fade.

Signals to Watch Next

Issuer footprints: Where new mints and redemptions concentrate over weekly intervals.
Merchant and fintech integrations: Concrete announcements beat speculation. Track checkout providers, neobanks, and payroll platforms.
RWA migrations: Whether tokenized treasuries and cash-equivalents expand to Solana or remain ETH-centric.
On-chain settlement volumes: Especially for sub-$100 transfers that stress-test fees and finality.

Scenario Map: The Next 3–6 Months

Momentum Broadens (Bullish for Solana)

Stablecoin issuers deepen support on Solana; payment processors roll out production integrations beyond pilots; ETF narratives convert to measurable inflows. Growth outpaces peers again, with spillovers into consumer apps and in-game economies.

Two-Track Equilibrium (Base Case)

Solana keeps compounding in payments and remittance-like flows; Ethereum remains the institutional settlement layer for RWAs and large-ticket activity. Chains specialize, and market share shifts are incremental rather than dramatic.

Reversion to Safety (Cautious Case)

A reliability hiccup or regulatory surprise nudges enterprises back to the most conservative rails. L2s capture more of the low-fee use cases while Ethereum’s absolute dominance in value terms widens again.

Bottom Line

The GENIUS Act served as permissioning clarity for a market itching to scale payments. In the aftermath, Solana has seized the moment with a rapid climb in circulating stablecoins, aided by its low-cost, fast-finality design and a wave of new pilots. Yet the scoreboard by sheer capitalization still reads Ethereum by a wide margin — and Ethereum’s RWA and TVL dynamics underscore how deep that moat is. Rather than a single winner, the emerging picture looks like a two-track system : Solana as the high-velocity conduit for consumer-grade transactions, and Ethereum as the deep-liquidity settlement layer for institutions and tokenized assets.

Watch where issuers deploy, where merchants integrate, and how cross-chain liquidity tooling evolves; that will tell you if Solana’s recent surge is the start of a durable shift or a fast lane feeding back into Ethereum’s gravity.

Disclosure: This article is for informational purposes only and does not constitute investment advice. Do your own research and consider your risk tolerance before allocating capital.