Today’s competition to accommodate the next wave of stablecoin liquidity is less about raw throughput and more about control versus openness. The field is becoming increasingly crowded, both with veteran channels like Gnosis, newcomers like Plasma and Neural, and yet-to-launch app channels like Arc and Tempo.
First of all, a reality check. Despite all the new Layer 1 (L1) fanfare, Ethereum still holds the lion’s share of stablecoin issuance and liquidity. USDT, USDC, USDE, USDS/DAI, etc., as well as most of DeFi’s real activity, live there (or are anchored there). Even if new chains appear, they will face the gravity of Ethereum’s liquidity and network effects.
Emerging stablecoin-specific blockchains – Arc, Plasma, Tempo, Neura – are designed to challenge this dominance by offering more “purpose-built” architectures. But underneath lies a tension: do you give control to issuers (and with that risks), or do you preserve an open system that welcomes any stablecoin without asking permission?
Gnosis and the Open Rails Pitch
In a recent community presentation, Gnosis leaders explained their philosophy. They repeatedly contrast a model in which a chain supports a single issuer with a model in which many issuers and partners can connect. As business development manager Julian Nesk said, “We view the Gnosis channel as a B2B platform” and “give tools to our partners, which are mostly wallets, which they will then give to users.”
In short, Gnosis wants to provide the plumbing – liquidity, bridges, DeFi applications – without picking winners, remaining aligned with Ethereum’s philosophy of neutrality.
As a reminder, Gnosis was founded in 2015 by Martin Köppelmann and Stefan George as one of the first projects built on Ethereum, initially focused on decentralized prediction markets. Over time, it has become a broader player in the Ethereum ecosystem, playing a role much like a canary network. For example, Gnosis has consistently adopted Ethereum upgrades – hard forks – before the mainnet. Large infrastructure projects such as Safe (formerly Gnosis Safe) and CoW Swap were born from Gnosis.
A central argument of Gnosis: why issue via a chain built by a stablecoin issuer when that issuer can deprioritize you later? They warn that when transmitters launch their own channels, partners or smaller transmitters risk losing access or support. Gnosis considers its neutrality as a guarantee against this trap of centralization.
Gnosis also emphasizes a more regional approach to stablecoins, aiming to become “the local currency chain” by supporting the Euro, Peso, Lira, Rand, etc.
“We are definitely going to be the stablecoin chain, not because we will have the largest circulating supply of US dollar stablecoins, but because we will be the stablecoin with the largest number of local currency stablecoins,” Nest said. This strategy depends heavily on openness: the more issuers and regional variants they integrate, the wider their gap.
Celo made a similar offer for non-USD stablecoins to Gnosis (not pictured) | Source: Cinder Block Research
That said, Gnosis recognizes the challenges: liquidity accumulation, transition, and performance incentives are not trivial. So far, there has been very little demonstrated demand for non-US dollar stablecoins. But his message is that openness will ultimately prevail. It’s one of the few permissionless L1s to explicitly court multiple teams rather than being primarily tied to just one.
Contrasting architectures
Arc is essentially Circle’s attempt to move from being a ‘transmitter’ to a ‘rail operator’. The chain is designed around USDC, as a native gas token, enabling predictable dollar-denominated fees, and intends to integrate an integrated FX engine and Cross-Chain Transfer Protocol (CCTP) to link stablecoins together.
The chain is expected to offer sub-second deterministic finality via a Malachite consensus engine and enable opt-in privacy features. On paper, this looks like a prime test of the Cosmos-inspired application chain thesis.
Since Circle already controls major stablecoin issuance and infrastructure (USDC, gateways, payments), Arc will begin life with deep liquidity and infrastructure. But this comes with a risk of centralization: validators, governance and incentives can tilt in favor of interests aligned with the Circle.
Arc’s architecture is therefore hybrid: open-source, EVM compatible, but deeply integrated into a transmitter’s stack.
Plasma, which went live on September 25, bills itself as a “native stablecoin” chain. It offers fee-free USDT transfers, configurable gas tokens, and confidential payments support as core capabilities.
Although optimized for high-volume USDT flows and designed for payments, not widespread DeFi, it has nonetheless earned over $13 billion in bridged TVL in its short lifespan, attracted by the significant liquidity incentives of the chain’s XPL token. But again, liquidity is concentrated in a single stablecoin, and non-USDT issuers may find limited support. The tradeoff: great performance and low friction for USDT traffic, but a tighter ecosystem.
Tempo, backed by Stripe and built with Paradigm, has emerged as a priority payments chain that has yet to launch. The technical details are thin, but it aims for sub-second finality, a stablecoin-agnostic gas model, and tight integration with merchant payment flows.
It will be interesting to see which stablecoins it targets for adoption.
Neura is more speculative and vertically ambitious: it plans to own hardware, protocol-level revenue (RPC, MEV/OEV), and “gasless” transfers for its native stablecoin. It aims to capture yield flows as well as settlement. But there will be plenty of competition, and this latest incarnation of Near represents a pivot of an “AI chain” initially launched by the Ankr team in 2024.
Non-USD volume remains modest on-chain (USD hidden above) | Source: Cinder Block Research
What differentiates Gnosis from these challengers is its insistence on openness. Gnosis is effectively betting that the next wave of stablecoin adoption will come from diversity, not dominance. If many local stablecoins, cross-border remittance tokens, regional exchange bridges and stablecoin partners emerge, the network that accommodates them without access control could have an advantage.
Even as these stable chains struggle, the Ethereum Virtual Machine (EVM) remains the standard. No matter how Arc or Plasma optimizes, their stablecoins will likely still reside primarily on the Ethereum mainnet, just like USDT does today (with Tron a close second). This inertia is immense.
The path from Gnosis to success is much steeper. Its opening is comparable to that of any L1, but it must demonstrate yield, adoption, transition, performance and stability equal to those of newcomers. If liquidity flows begin to prefer Arc’s guaranteed performance or Plasma’s fee-free transfers, Gnosis could rely more on diversity.
In narrative terms, this is not just an arms race, but a struggle over who controls the rails of programmable money. Will stablecoins inhabit a world of corporate-owned rails or public goods that everyone can access? Watch this space.
Get news delivered to your inbox. Explore Blockworks newsletters:
