Although each person obtains earnings from stablecoins differently, ultimately, these earnings stem from four core value propositions: low cost, high speed, permissionless, and programmability.
The original author Nathan once explained in another article "The What and Why of Programmable Money": Programmable money is money that can set behavioral logic like code. It is a stablecoin and the fuel for smart contracts. It can set: when, why, and how to transfer funds. And all of this no longer depends on banks or trust, but only on the code itself.
These four value propositions correspond to four core use cases: storage, payment, transfer, and yield. "The Hierarchy of Value Realisation" is a new cognitive model that explains the most valued points for different types of users from stablecoins.
This article will focus on two user groups: "People Who Need Stablecoins" and "People Who Don't Need Stablecoins So Much", namely: emerging market users and Western market users.
Two Major User Groups of Stablecoins
Simply put, in emerging markets, stablecoins are building a new financial infrastructure; while in Western markets, stablecoins are more of a supplement, integrated into existing financial technology (Fintech) and traditional financial systems (TradFi). This rule applies broadly to both emerging stablecoin projects and established players. Based on this, we can outline different "value realization hierarchies" for these two types of users.
I. Value Realization Hierarchy for Western Market Users
Western markets mainly correspond to "Global North" countries: politically stable, with developed financial systems, where most people have bank accounts and can earn interest on savings.
In these markets, programmability is the core driving force for stablecoin innovation. This is similar to the explosive development of the internet, iPhone, or smart contracts: programmability brings new financial innovations, which is precisely the love and strength of the Western world.
Next is "speed". The settlement speed of cross-border or local payments has long been a critical challenge in the Fintech field. Settlement delays consume liquidity and create opportunity costs, so it ranks second in Western markets.
"Cost" ranks third. Although reducing transfer costs is a major highlight of stablecoins, transaction fees in Western markets are already low, far from the exorbitant 115-dollar fee for a 200-dollar remittance in emerging markets.
The importance of "permissionless" is lowest in Western markets. Because most people have already opened bank accounts and can easily use cash or transfer payments, they naturally do not need to rely on stablecoins to access financial services.
Therefore, Circle and USDC have an advantage in Western markets. As a company fundamentally oriented towards financial technology, Circle emphasizes programmability, low cost, and efficiency, which align with Western users' usage preferences. Now, more and more Western enterprises choose to develop based on USDC when building stablecoin solutions.
Additionally, "yield" is gradually becoming an additional focus for Western users. Since they are accustomed to earning interest from bank deposits, they question why holding stablecoins cannot generate similar returns. This is completely different in emerging markets, where users are more concerned with the stability of currency value, especially the ability to obtain US dollars, rather than yield.
According to the author's perspective: In fact, yield has never been the decisive factor for stablecoins' success in these markets. As industry analysis points out, USDT became the most liquid stablecoin globally precisely because it can dominate without distributing Treasury yields to users, based on its strong accessibility and deep liquidity foundation. For many users in high-inflation or capital-restricted areas, avoiding the risk of local currency depreciation is far more meaningful than a 3% annual interest rate. They care more about: Can I safely exchange my assets for dollars, can I transfer them out at any time, and can I use them locally?
Therefore, in these regions with true "product-market fit", stablecoin liquidity is far more important than yield capacity. Liquidity tends to concentrate, ultimately forming a network effect for top stablecoins. This is why stablecoins like USDT can be widely adopted globally, even without a yield mechanism.
II. Value Realization Hierarchy for Emerging Market Users
Compared to the West, emerging markets (the "Global South") have relatively weak financial infrastructure, widespread local currency inflation, and low bank service penetration. The emergence of stablecoins allows users in these regions to freely acquire, transfer, and use stable currencies like US dollars for the first time, which was unimaginable in the past.
Therefore, for emerging market users, "permissionless" is the most core and transformative value proposition. Regardless of whether they have a bank account, users can directly access the US dollar system, thus unlocking financial freedom.
Next is "low cost". In emerging markets, cross-border remittance fees remain high. For example, when a father sends money home to support his family, the transaction fees might consume a significant portion of the transfer amount. Stablecoins greatly reduce these remittance costs.
Third is "speed". The current cross-border transfer system is inefficient, with funds often taking days or even weeks to arrive. Stablecoins can achieve second-level transfers, solving the life and economic difficulties caused by fund delays.
Last is "programmability". Although this value proposition also has profound implications for emerging markets (such as unlocking insurance, lending, contract payments, etc.), its perceived short-term value is slightly lower compared to the first three.
Overall, Tether's USDT is thriving in emerging markets. Tether provides critical financial services to millions of unbanked people through freely usable, widely accepted, and highly liquid USDT. Its success is precisely based on the realization of these fundamental value points.
Summary and Reflection
Circle is adapted to Western markets, as it better fits the needs of financial technology companies; Tether serves a broader user base, especially those who truly depend on stablecoins.
In other words, Circle wins with "tool attributes", while Tether wins with "survival necessity".
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