Ethereum enters the era of "asset tokenization": Opportunities from the depths

After the market crash in October, investor sentiment and capital recovery require more time. However, the interesting point is that global movements have not stopped — positive signals from monetary policy, support from traditional financial institutions, and deep technical upgrades all clearly indicate that the crypto market is entering a completely new development phase.

Blockchain Becomes the “Infrastructure” of Global Finance

On December 3rd, SEC Chairman Paul Atkins made a clear statement in an exclusive interview: in the next few years, the entire US financial market could move onto blockchain. This is not an unfounded guess but a conclusion drawn from in-depth analysis.

Atkins emphasized three core benefits of asset tokenization:

First, transparency in ownership: When assets exist on the blockchain, the ownership structure and financial characteristics will be completely transparent. Unlike the current system, publicly listed companies often lack clarity about shareholder identities, geographic locations, or actual voting positions.

Second, optimizing payment processes: Tokenization allows for “T+0” payments instead of the current “T+1” cycle. Delivery-payment mechanisms (DVP) and receipt-payment (RVP) on the blockchain can minimize systemic risks and enhance transparency, because payment-settlement-capital transfer delays are among the biggest sources of risk.

Third, this is an inevitable trend: Major banks and leading securities firms have begun promoting tokenization. Atkins forecasts that it will take only a few years to a decade for this complete transformation to be visible worldwide.

New Architecture: US Dollar - Ethereum - RWA - L2

In reality, Washington and Wall Street have built a tightly interconnected financial network around crypto. This model is shaped from:

• Stablecoins (USDT, USDC, etc.): Mainly backed by US short-term government bonds and bank deposits, managed by securities firms like Cantor.

• US Government Bonds: Low-yield, minimal-risk underlying assets used as reserves by stablecoins and crypto treasuries.

• **RWA (Real World Asset): From government bonds to mortgage loans, receivables tokenized through Ethereum L1 and L2 protocols.

• Ethereum and L2s: The main chain receiving capital flows from RWA, stablecoins, and DeFi applications. L2 tokens benefit from transaction volume and future fee streams.

This value chain follows the diagram: USD Credit → US Bonds → Stablecoin Reserves → Treasury/RWA Protocols → Finally accumulated on ETH and L2.

Looking at the current RWA TVL index of $12.4 billion, Ethereum is the only public chain that recovered quickly and grew immediately after the October crash, accounting for up to 64.5% of total RWA across all other chains.

Fusaka Upgrade: “Coercive Competition” Solution for L1

Ethereum’s Fusaka upgrade has just been implemented, which, although not making a big splash, marks a significant milestone in network architecture and economic model.

Fusaka not only expands capabilities through improvements like PeerDAS but also addresses a crucial issue: how L1 can regain value since L2 has developed strongly.

Through the EIP-7918 update, Ethereum introduces “blob fees” into the “dynamic fee market” mechanism. This means the minimum cost for data update work (DA) must be at least 1/16 of the L1 fee. This implies: Rollups can no longer use blob bandwidth at near-zero cost long-term — they must pay real fees, which will be “burned” (burn) to return value to ETH holders.

Regarding Ethereum’s “burn” history:

• London: Burned only L1 fees, ETH began deflationary
• Dencun: Burned both L1 and blob fees, but when demand is low, blob burns are nearly zero
• Fusaka: Blob linked to L1 base fee, forcing L2 to pay fixed fees, stabilizing burn rates

Current figures: Blob fees have increased over 5,696 times compared to before the upgrade, with a burn rate of about 1,527 ETH daily, accounting for 98% of total burns. As L2 activity continues to grow, Ethereum may return to a truly deflationary state.

Technical Analysis: Signs of “Short Squeeze” Coming?

The October crash liquidated all leveraged ETH positions, affecting the spot market. Many long-term investors lost confidence and withdrew.

According to Coinbase data, current leverage has fallen to a historic low: only 4%.

An interesting detail: In the past, the “Long BTC / Short ETH” trading pair performed very well in bear markets, but this time it unexpectedly lost effectiveness. The ETH/BTC ratio from November to now has maintained resistance.

Especially, the ETH on exchanges is now only 13 million (representing 10% of total supply), the lowest in history. When the Long BTC / Short ETH pair no longer works, in a panic market, there could be an opportunity for a “short squeeze” (squeeze).

Future: Global Debt and Positive Policy Signals

Entering the 2025-2026 period, US and China’s monetary and fiscal policies are signaling positivity:

• US: Proactively reducing taxes, lowering interest rates, easing crypto regulations
• China: Appropriately easing, stabilizing the financial market

With expectations of easing from both sides, ETH remains in an attractive “good buy zone” — while capital and sentiment have not fully recovered, the fundamentals are back on the right track.