If you've been following the DeFi space on Ethereum, you've probably noticed how liquidity for stablecoins—those crypto assets designed to hold a steady value, like USDT or USDC—has been shifting around. A recent thread from Tom Wan (@tomwanhh), head of data at Entropy Advisors, breaks down this evolution, highlighting the move from Curve's early dominance to the rising star, Fluid DEX.

Back in the DeFi summer of 2020, Curve Finance was the go-to platform for stablecoin swaps. Its famous 3pool, which pooled DAI, USDT, and USDC, amassed up to $6 billion in liquidity at its peak. This made Curve a critical spot for monitoring stablecoin risks and executing large trades without much slippage—that annoying price shift that happens during big swaps. As a result, Curve captured over 40% of the stablecoin-to-stablecoin trading volume on Ethereum mainnet.

Fast forward to today, and things look different. Fluid DEX is emerging as the new hub for stablecoin liquidity. Projects like GHO from Aave, USDe from Ethena, wstUSR, RLP, and sUSDe are directing their primary liquidity to Fluid. What sets Fluid apart? Its smart collateral and smart debt features allow liquidity providers (LPs) and market makers to earn more through lending and trading while borrowing from their positions for better capital efficiency.

Right now, Fluid's sweet spot is stablecoins—90% of its volume comes from stable-to-stable swaps. It's become the main liquidity venue for several tokens:

• USDe: 55% of its total DEX liquidity
• wstUSR: Over 90%
• GHO: 67%

In August, Fluid led the pack with 31% of stablecoin swap volume, pushing Curve down to second place behind Uniswap at just 9.6%. This marks Fluid's second straight month at the top, but as Tom notes, we've seen flashes in the pan before. DODO and Maverick briefly overtook Curve, but couldn't hold on. The real test for Fluid? Sustaining this lead for six months or more.

This shift matters for anyone in blockchain, especially if you're trading meme tokens or other volatile assets. Stablecoins often serve as the on-ramp and safe haven in DeFi, so where their liquidity pools up affects overall market efficiency. If Fluid solidifies its position, it could reshape how protocols integrate liquidity and how traders navigate Ethereum's DEX ecosystem.

For more data dives like this, check out the Entropy Advisors dashboard on Dune. What's your take—will Fluid dethrone the old guards for good? Drop your thoughts in the comments below.