Author of the viewpoint: Michael Egorov, Founder of Curve Finance

The crypto world shifts its focus every few months, with headlines buzzing around AI, integration, meme coins, and grand Web3 visions.

As the spotlight moves from one trend to another, a quieter, deeper transformation is happening beneath the surface: a new financial system based on stablecoins, decentralized finance (DeFi), and code-driven contracts is gradually emerging.

This system can nominally be called "Money2"—it is not a theory or a future vision. It is already here.

Reports from early 2025 show that the total supply of stablecoins reached $225 billion in February, achieving a 63% year-on-year growth. This surge highlights the increasingly expanding role of stablecoins in payments and as a medium of exchange. Thus, it also positions them as key elements in building a new global financial ecosystem.

Moreover, for the first time in history, financial services can operate entirely without reliance on intermediaries and trust in third parties. Loans, trades, and payments no longer need to depend on traditional intermediaries.

Instead, they run on smart contracts—transparent and immutable lines of code on decentralized blockchains. It is code, not humans, that decides how funds flow, how lending occurs, and how protection is provided. This is not merely a repackaging of existing finance. It is a breakthrough against millennia of precedent—a form of disintermediation that changes everything.

Throughout human history, money has always relied on trust in people or institutions. Whether it is transfers, loans, or investments, intermediaries have always been involved. Every traditional financial service relies on banks, brokers, or government regulatory entities—it relies on trusting someone.

Because people and institutions are ultimately fallible, this trust has been betrayed many times throughout history. The entire legal framework, including audits and penalties, has evolved over the years to keep these third parties honest—better managing this trust.

However, risks still exist.

Money2 eliminates this dependency. In this new paradigm, smart contracts—code on decentralized blockchains—replace intermediaries. Transactions can be executed automatically and transparently, without any gatekeepers or biases. No human judgment or intervention is needed. Only code.

Through DeFi, financial operations can occur without relying on people or institutions, as the code executes exactly as written. No banker will delay, refuse a transfer, or freeze your funds. Everything can be verified on-chain, and what you see is what you get.

This is not just a technological improvement. It is a leap in the entire philosophy of finance. It means fewer opportunities for corruption, less bureaucracy, and the potential to reconnect how global financial services operate, opening the door to a more transparent and accessible financial system.

The current crypto narrative is increasingly distracted, dominated by flashy trends that divert attention from the most critical functions of blockchain: functional, scalable alternatives to traditional finance.

Not all non-financial blockchain use cases are irrelevant.

While things like AI integration into cryptocurrency are undoubtedly interesting, they do not address the most important issue: traditional finance is fundamentally flawed. Fund transfers are often reversed, international payments are slow, and compliance checks can delay onboarding for days—the list goes on.

Even basic transactions face failures, delays, and hefty fees.

DeFi remains the most transformative use case of blockchain technology because it provides a way out of all these issues, enabling intermediary-free payments, lending, trading, and more. When combined with stablecoins, these systems form the pillars of Money2.

DeFi is not just about digitizing old frameworks; it is about completely reimagining them. Even traditional financial institutions themselves can recognize the value of decentralized solutions. This indicates a significant shift in perspective among traditional financial institutions.

"If Money2 is so revolutionary, why hasn't it become mainstream yet?"—this is a question many might ask at this point. Well, that is because the shift it requires is uncomfortable in many ways.

And there are still some barriers that need to be knocked down first.

The first issue is simple: accountability. Removing intermediaries means users must rely on themselves. Transactions are irreversible, so there is no room for error. If you lose access to your wallet or fall victim to a scam, funds are rarely recoverable. For many, this is too great a risk.

Today's DeFi requires a steep learning curve, and self-custody is challenging. Most people are not yet ready to manage their private keys or navigate the complexities of smart contracts without a safety net. This is especially true when they do not understand how anything works or the risks involved.

Secondly, the network itself has not yet been sufficiently optimized for this shift. Traditional browsers and web architectures currently underpin DeFi interactions, and they are not designed for securely handling high-risk financial transactions. Unless new interfaces specifically built for DeFi are constructed from the ground up, adoption and usability will not become widespread.

Finally, for DeFi to be more universally useful, the actual asset classes available need to be expanded.

Stablecoins are a good start, but to truly realize Money2 as a mature financial system, we need more than just crypto-native elements. Real-world assets, such as stocks, bonds, commodities, and real estate, must be tokenized and traded on-chain.

Admittedly, this is a challenge that needs to be addressed, whether in terms of technology, logistics, or legal aspects, so it will take longer to get there. However, it is a challenge worth solving. Tokenizing the full array of assets that bring value will make DeFi a one-stop platform for all financial activities, which is crucial for its continued growth.

Author of the viewpoint: Michael Egorov, Founder of Curve Finance.

Related: Major changes in the crypto derivatives market: Trading volume surges by 46%! Who is quietly stealing your "big player" share?

This article is for general informational purposes only and is not intended to be and should not be construed as legal or investment advice. The views, thoughts, and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Original article: “The Rise of Money2: The Next Generation Financial System Has Emerged”

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