Shielding the Flame

Hidden away on one floor of the Jaganmohan Art Museum in Mysore, in a side alcove surrounded by drab walls and a dusty glass, is an absolute masterpiece by Sawlaram Laxman Haldankar. There was no advertisement, no fanfare. I had seen it digitally before, but it had never registered. Standing there, seeing it for real with my own eyes, it mesmerised me. It has not let go since.

On a recent trip to Mysore, I took time away from family commitments. I went there to see the Raja Ravi Varma paintings, and they did not disappoint. However this painting by Haldankar painted in 1945-46, Glow of Hope (or less inspiringly, Lady with the Lamp) is probably one of India's most iconic paintings.

Now, I am no art critic, and neither can I do justice to the art quality or painting style. But a casual reading about it tell me enough to be amazed. It is unique because it is a watercolour. Oil painting for such art is more common. Watercolour is hard. Haldankar was a well-trained and accomplished painter who studied at the famous JJ School of Art.

But even beside that, the story of how the painting came to be is also evocative. The subject is a young girl, who happens to be the artist's daughter, Geeta Haldankar, all of about 13 or 14 years of age at the time of the painting. Haldankar had purchased a lavender saree for his wife on the occasion of Deepavali, the festival of lights. His daughter wore it and came running to show him how pretty she looked. In that moment, looking at her in her mother's saree, holding a diya lit for the festival, the artist was struck with inspiration. Over the next days, Geeta posed for him continuously, for hours together, while he got this inspiration on paper right.

Art commentators talk about the beauty of the light portrayed so amazingly behind the fingers. Shielding it from being extinguished, and the glow it bestows on her face. They talk about the enigma of the face. Is she smiling? Is she serious? Is she defiant, or is that innocence? Is she young and curious, or old and wise?

There are descriptions, and even a video of Geeta, who lived to the ripe old age of 101, speaking about her experience and her father's art.

But I want to focus on something else. Something that has been bugging me, swirling in my head, that I had not been able to connect.

The Slow Burn

I say "recent trip," but it was over six months ago. Life has been busy. But ever since I saw this painting, I have wanted to write about it. I have looked at it many times, trying to find the words to describe why I liked it so much. Various thoughts have come and gone, mostly variations on the brief descriptions above, each with stories in themselves. But something was always missing, and I could not place it.

Then today, commuting back from work on a regular Tuesday, it struck me.

And it is this:

The reason this painting feels so evocative is because the artist captured the fragile glow of hope for a country on the cusp of freedom from oppression.

This painting was started in 1932 but completed in 1945-46. The artist mulled over it, inhabited it maybe, through tumultuous times for the world and for India. By 1945, World War 2 had come and gone, leaving behind a fractured world. The British were heroes in the European theatre but were still the evil oppressors in India, depleted in Europe, still holding on to the Jewel in the Crown. The independence movement in India was at its peak - but had also splintered into many factions with different motivations. The Quit India movement had come and gone. The INA was being put on sham trials. There was general unrest, and the zeitgeist was pulled sharply and tattered, between hope and despair.

It is in this context that Haldankar sees his young, innocent daughter adorned in new clothes, shielding a gentle flame with her tender hands, lest it be extinguished by a stray wind, on the festival celebrating the victory of good over evil. She is enthused at being able to don new clothes, to break free. But she also somehow has the wisdom to know that the gentle flame of hope has to be shielded from the evil vapours swirling around. And in doing so protectively, providing the ashray (refuge) to the chirag (the light) of independence, the hope of freedom from oppression, she ends up illuminating her face with the glow of hope.

It is this version of India, one on the eve of becoming a free woman, that Haldankar's painting chooses to portray. That is why, while he is painting a young girl, she seems to carry the maturity of wisdom on her face. The enigma is no enigma at all, only to those who dwell on it briefly. To me, she became Bharat Mata, Mother India. The young maiden on the cusp of freedom, eagerly donning her new clothes, and also the wise mother who knows that freedom is precious and has to be shielded.

This is why the painting mattered so much to me, and why I had struggled to tie it together.

Haldankar himself probably never attributed any political meaning to this piece. This might just be my search for meaning in something I have seen. But I cannot help imagining that in the moment Haldankar saw that vision of his daughter, the spark of inspiration was born from all the milieu in the Indian consciousness of that time.

I am probably not the first person to arrive at this hypothesis, though a cursory check with my AI assistant suggests otherwise. Who knows; the AIs are sycophantic and might just be telling me what I want to hear. That is OK. My search was cursory anyway, because this is my insight, arrived at unprompted, and I am convinced of the meaning I have derived from it.

Inhabiting the thought

This brings me to something I feel strongly about: how insight emerges.

As a professional market researcher and strategy professional, insight is what I should be paid for. But insight is hard to come by and is being commoditized by the fast and the shallow need for speed. I have wondered about it for years on where and how does Insight emerge from?

Back in 2021, I wrote about it. My takeaway then was that insight emerges from writing, that writing helps us connect the dots. But I was only halfway there.

In 2025, I wrote about the Fog and the Mountain behind it, how insight reveals itself. I wrote about how, for insight to emerge, we need to move from absorbing to seeing, from gathering to generating, and inhabit a thought long enough to force the insight to coalesce around the silence and the noise. About how it is necessary to make it weird and go off the edges.

That is what happened here. I had been stewing on this painting for six months. Thinking about what intrigued me about it. Scrolling past the image and description plaques on my phone's gallery during commutes, as a way to avoid doom-scrolling. I was also reading, writing and consuming many other things. Books about India's independence struggle; Amit Varma's podcast about his trips to Spain and the paintings of Francisco Goya that he saw there; episodes of Mad Men where Don Draper describes nostalgia as a powerful force in the famous Carousel pitch; Neal Stephenson's The Diamond Age, where in a post-abundance future the real battle is all about culture, fought over a young girl's book. And I have been drowning in the mediocrity of AI-generated slop, the Godzilla stomping on the creative and marketing professions, the darling of CFOs, and the subject of mind-numbing corporate training workshops promising to make me both superhuman and at the same time preparing me for the job I am about to be replaced from.

All of this was stewing somehow. The inputs were seemingly random. But they were all, in different ways, about culture under siege and what it means to protect something fragile. The idea about the painting's meaning had been inhabiting my mind to the point where I was asking myself weekly: what is it a metaphor for? What is the idea in disguise?

Then today, on my commute back from work, it just struck me. Out of the blue. Enough to force me to my desk to write this.

Insight comes from inhabiting a thought. No substitutes.

A couple of years ago I read a presentation by Joe Burns on LinkedIn that said: 

Insight is a nocturnal predator. Its potency wanes in the sunlight.

He goes on to say that real insight (he says advantage) is found in its natural habitat - which is off the map, at the edges.

I could not agree more.

The Maharaja's Insight

I will close with how the painting came to be in the Mysore gallery. It is said that the Maharaja Jayachamaraja Wodeyar of Mysore saw it at an exhibition and purchased it on the spot, without hesitation, for a then-princely sum of Rs. 300.

I suspect the Maharaja was struck by some kind of insight as well.

BOOK NOTE: Revolutionaries - Sanjeev Sanyal

One of those books that gives you a different perspective on history. Especially interesting for an Indian reader, it makes you realize that without engaging with different parts of history, and relying only on what you were taught in school, you can never know the whole story. I have enjoyed Sanyal's other books and essays, so when the algorithm recommended this I was keen to pick it up. I listened to it as an audiobook and the narrator does justice to Sanyal's rousing prose.

The book tells the story of how India's independence was not achieved only through the non-violent movement led by Mahatma Gandhi, as history textbooks often portray. I consider Gandhi to be among the most unique and singularly inspired figures of the 20th century. What he built through non-violent resistance is one of the most remarkable stories of self-determination in history. The Mahatma was what he was recognized to be for a reason.

But there is this whole other part of how the Indian freedom movement grew. This book paints the picture of key figures like Sri Aurobindo Ghosh, Savarkar, Rash Bihari Bose, Netaji Subhash Chandra Bose, and others who shaped the movement through a different kind of revolution. I particularly enjoyed Sri Aurobindo's journey, from the Indian National Congress to leading the revolutionary Anushilan Samiti. The story of Rash Bihari Bose and his years in Japan was compelling.

I was struck by a different Great Game playing out in the early 1900s, not the British-Russian intrigues of the preceding century, but Asian powers beginning to recognize their strength through connection. 

There is a story of fight, but also of heartbreak. A story of perseverance and grit. Some of these revolutionaries were imprisoned multiple times in some of the most dangerous and inhumane conditions in the Andaman and Nicobar Islands, in the famous Kala Paani or Cellular Jail. This book does not dwell on that, but I could not help wondering: the stories of those who survived Kala Paani have never received the same attention as those of western writers like Viktor Frankl, yet the suffering endured and the grit displayed by these Indian revolutionaries is of the same order.

BOOK NOTE: Who Moved My Cheese - Dr. Spencer Johnson

"Who Moved My Cheese?" by Dr. Spencer Johnson is a simple short book which makes the essential point that you should not be afraid of change and that operating from fear can be a problem. Instead as it quotes in the book - "If you can realize fast enough that things have changed, you can let go and then quickly move on. You are at an advantage."

The story is told in a weird way. There are two little people, Hem and Haw, and two little mice, Sniff and Scurry. The latter two tend to figure out or anticipate what's coming/changing and then take action. Hem and Haw, like their names suggest, tend to be stuck. It is told through the process of how they adapt to change, in this case "cheese". The cheese that they were always getting, think of it as employment, is gone. Sniff and Scurry move on and they go and find the new place where they can find new cheese. Hem and Haw expect things to be the same and given to them, and that keeps them stuck. Haw eventually learns and moves out and puts in the effort to go find cheese for himself, but Hem stays stuck.

It is not something mind-blowing book but an effective one. I found it simple and easy to read; the book is only about a hundred pages or so. It can be read on a flight or even in an afternoon and is very useful especially when you're thinking about how to adapt to change.

In today's world when so many people are doom scrolling about problems of AI, this book in a short, simple, and effortless way provides a small dose of confidence. The central message is that "mood follows action". To be ready for change anticipated it and don't get stuck, move on. 

Coordination Density: Science Fiction and the future we risk never building

Disclaimer: This reflects my own perspective. This is me thinking out loud. It does not represent the views of my employer or any other organisation.

 

Ray Bradbury is claimed to have said that Science Fiction is about the ideas that haven't happened yet, but soon will. Bradbury was well known to be prophetic about the role of science fiction as an incubator of civilizations that are yet to be. And I believe it to be true.

Science fiction is the most important literature in the history of the world, because it's the history of ideas, the history of our civilization birthing itself. Science fiction is central to everything we've ever done, and people who make fun of science fiction writers don't know what they're talking about – Ray Bradbury

Bradbury's observation is not unique. His contemporary Robert Heinlein, perhaps one of the greatest science fiction writers, defined the genre as 'a realistic speculation about possible future events', meaning what is fiction today, soon becomes fact.

The prophetic nature of science fiction has long been observed. Modern futurology credits it as important source material for understanding the future. Perhaps most tellingly, the very first issue of Amazing Stories, the magazine that popularised the genre carried the slogan: 'Extravagant Fiction Today. Cold Fact Tomorrow'.

Science fiction helps us imagine things that might be, both the good and the bad. Human beings are meaning makers, and the evocative power of science fiction helps us make sense of the future. And in doing so, it helps make it come to life. Science fiction doesn't just predict the future; it manufactures it. By creating shared mental models, it gives everyone who encounters it, engineers, investors, policymakers, culture makers, a common language and a common horizon to build toward.

But the modern world we live in today, many of its iconic inventions which were birthed through the efforts of a great science fiction corpus of the past century is now at risk of not being able to produce the same for our future. If 21st century's greatest boon is the digital revolution, the fragmentation of attention that it creates is its greatest bane. I argue here that science fiction's effectiveness as a coordination mechanism is being diluted by this fragmentation. What do I mean by fragmentation? For most of the 20th century, people consumed media in broadly shared ways. The same television programmes, the same blockbuster films, the same bestselling novels. Not everyone, and not equally. But enough people were drawing from the same cultural well that shared archetypes could form and spread. The internet was supposed to democratise that further. Instead, algorithmic feeds, streaming personalisation and the attention economy have done the opposite. They have sorted us into self-selecting bubbles, each optimised for engagement rather than shared experience. We have more content than ever and fewer shared moments than ever.

The consequences are not just the lack of shared cultural moments, but in the stagnation of innovation. And reversing that will take a civilisational effort.

Science fiction historically worked as a bridge between imagination and engineering. Not because it predicted technologies, but because it turned emerging possibilities into shared archetypes that large groups of people could collectively orient around. When that shared orientation weakens, certain kinds of civilisational innovation become harder to pursue.

 

Origins

The origins of science fiction are hard to pin down. Stories from antiquity blended facts and mythology can be considered as part of this genre. But the modern version of the genre took shape post-enlightenment, as a way to imagine, visualise and comment on the anxieties of the day. Mary Shelley's Frankenstein and Jules Verne's Twenty Thousand Leagues Under the Sea in the 1800s are considered its pioneering works.

Science fiction started as another kind of story, one that allows the reader to extrapolate and imagine things. Like all stories, science fiction stories had to be engaging and evoke a sense of excitement, but they had to have some anchor in everyday reality. And that is just what happened. Jules Verne did not invent the submarine from the depths of his imagination alone. He borrowed from what was already being experimented in naval circles. In the early 1800s, Robert Fulton had built an underwater vessel for Napoleon — incidentally also named Nautilus. During the American Civil War, underwater vessels were deployed to break naval blockades choking the South. The CSS Hunley was one such working submarine, forward deployed in combat.

Verne's Nautilus from Twenty Thousand Leagues Under The Sea did however inspire the future of the submarine. Simon Lake, the designer of the Argonaut, had read Verne's book as a boy and developed an almost obsessive interest in it. It helped him build the first successful submersible in 1897. But Verne didn't only borrow from existing naval experiments. He imagined a fully sustainable self-powered electric submarine — a technology barely at the edges of possibility in his time. That was a true leap of fiction. It became the blueprint for the nuclear-powered submarine of the 20th century.

Mass media in the 20th century allowed people to share imaginative ideas in ways that were not possible before. Riding on the explosion of novels, magazines, television and motion pictures, science fiction became more than a niche form of literature. Asimov, Star Trek, Dune, E.T., Ursula K. Le Guin were not just authors or stories. They became civilisational reference points.

What was elite imagination became mass culture. In a century marked by two World Wars, the looming threat of nuclear annihilation, and extraordinary post-war prosperity, science fiction and its many sub-genres bloomed. The collective imagination it sparked didn't just inspire people. It provided the mental prototypes that fed back into what got built and what got funded.

Arthur C Clarke's 1945 paper 'Extra-terrestrial Relays' was the prototype that inspired satellites and the later boom in telecommunications. Robert Heinlein's space exploration stories deeply inspired many NASA administrators who orchestrated the lunar missions. In 1976, the space shuttle naming programme received so many fan letters requesting the vessel be named Enterprise after the Star Trek ship that NASA named their first orbital test vehicle after it. The Star Trek communicator inspired scientists at Motorola when they were creating the first mobile device. Computer scientists at Xerox PARC were influenced by Stewart Brand's counter-cultural Whole Earth Catalogue when the graphical user interface was born. William Gibson's Neuromancer imagined what cyberspace could be, and the early ARPANET researchers had a common language to work towards.

I would also argue that the current boom in agentic AI, systems that string multiple tasks together and work for you just by talking to them, was inspired by a generation of Gen X and Millennial computer scientists who grew up watching Iron Man interact with Jarvis. The list is endless.

Everything is becoming science fiction. From the margins of an almost invisible literature has sprung the intact reality of the twentieth century – J.G. Ballard

In the second half of the 20th century, science fiction shifted from predicting gadgets to being a coordinating mechanism A shared cultural blueprint that aligned governments, engineers, and the public toward collective technological goals.

Why did this happen? Beyond its mass appeal, science fiction taps into fundamental human emotions. It provides hope of things that could be and cautions against the dangers of what could come. On both counts it seeds ambition in those who consume it. The metaphors it creates expand our imagination and give us collective vocabulary to share, discuss and act on. It provides shared mental models to iterate towards.

But this incredible engine of coordination is now under threat, by the very thing it has birthed.

 

The Shift

Science fiction's journey from fringe imagination to innovation vocabulary in the 20th century is now well documented. But the same engine of growth is seemingly not firing on all cylinders anymore. Neal Stephenson wrote in 2011 about an Innovation Starvation, arguing that the lack of positive visions of the future was stalling scientific progress. The 20th century gave us electricity, automobiles, human flight, nuclear energy, manned space exploration and the internet. Then it seems to have stalled. We are still dependent mainly on fossil fuels. And the 21st century seems more polarised and more unequal than the one before it.

There is more safety, but less exploration of frontiers. The vast democratisation of information has created a glut of content but not a renaissance of exploration. The human hard work and collective endeavour that created the Moon landings and the Manhattan Project has given way to automating our emails and generating synthetic content. The AI boom, rather than reversing the stagnation, seems to be concentrating the means of production further away from human agency. There are outliers. A few techno-elites talk about making us interplanetary. But more people are sceptical than truly enthused.

The SpaceX IPO may generate irrational exuberance, but many are in it for a quick return rather than the civilisational impact. And yet it would be wrong to declare the coordination effect dead entirely. If the IPO goes as the early signals suggest, it would still represent a genuine mass coordination event around a civilisational bet. But one SpaceX is not enough. We need many such things happening simultaneously across many domains.

But there is a deeper issue at play. Two conditions mutually reinforce each other when science fiction successfully manufactures the future. The first is cultural coordination, the ability to inspire collective mental imagination and shared archetypes. The second is technical proximity, where an imaginative leap is within reach of current engineering and not just in the imagination layer.

In the 20th century these conditions were independently true. Science fiction narratives had enough coordination power that enough people understood the ideas, enough institutions recognised the potential, enough capital saw the value and enough makers could imagine pathways towards it. When Arthur C Clarke wrote about extraterrestrial relays, he wasn't inventing satellites. He did not invent the rocket or radio waves. He calculated how to place existing German V-2 rocket technology at a specific orbital altitude. Because it relied on existing engineering, it wasn't viewed as magic. Decades later when the COMSAT program was formed, engineers used his specific calculations as a literal deployment guide. If he had suggested teleporting data via psychic waves, no engineering team could have coordinated around it.

I call this socially legible technical proximity.

Under these conditions the Star Trek communicator could become reality. Telephones existed. Satellites already transmitted data. Millions of people were inspired by Captain Kirk speaking with his ship from a device that fit in his pocket. The archetype of a handheld wireless communicator was culturally well-understood. More importantly, it sat right at the edge of existing 1970s cellular radio engineering.

By contrast, the space elevator in Frank Herbert's Dune has not become reality. Not because there was no aspiration or collective imagination around it, but because there were no material science prototypes that could construct at a planetary scale. No small scale prototype means no engineering on-ramp. Though it is worth noting that Obayashi, a Japanese construction giant, has been quietly working since 2012 on plans for exactly that, targeting 2050, using carbon nanotube cables stretching 96,000 kilometres into space. More power to them. But their own feasibility studies say it will require international cooperation to become real. And international cooperation is exactly the kind of coordination that a fragmented world is finding hardest to summon.

But something people miss is that technical proximity and cultural coordination are not independent of each other. Technical proximity is actually downstream of the coordination effects of science fiction. Culture coordinates imagination first. That coordinated imagination creates the mental archetypes. This is what gives engineers the technical prototypes to extrapolate from. Break the cultural coordination, and you starve the technical proximity development as well.

Today the fragmentation of the mind is attacking the cultural coordination layer. Thanks to the addictive doom loops of digital technology, what was supposed to be democratisation of information has become siloed bubbles. There are fewer and fewer pan-cultural moments, and hence no shared archetype. Fragmentation is weakening the very mechanism that creates the archetypes that technical proximity depends on. As shared cultural consumption declines, fewer futures achieve the narrative density needed to become coordinated technical projects. The result is not merely fewer shared stories. It is fewer socially legible engineering trajectories.

 

The Edge

This brings us to the problem of the future. The role of science fiction as a collective future rehearsal is now unmistakably under threat. Fragmentation does not merely reduce shared culture. It changes which futures are actually possible.

Any sufficiently advanced technology is indistinguishable from magic – Arthur C. Clarke

We are potentially at a stage where if we do not solve the fragmentation problem, sufficiently advanced technology will simply remain magic. In the realm of fantasy rather than something engineering can prototype and make real.

The AI boom tells you something about where coordination has already broken down. Yes, civilisational bets are being made in gene research, drug discovery, climate modelling. But they are getting buried under the noise of every company rushing to reduce their human workforce and make agents talk to agents. The capital is flowing toward automating emails, optimising ads, generating synthetic content. As Peter Thiel once noted, 'we wanted flying cars and got 140 characters'. Today’s version might be ‘we wanted to cure cancer and got a better chatbot.’

Yes, most will argue it is still early and the civilisational bets will come. But the pattern so far is unmistakable. Highly effective at local optimisation and short-cycle returns. Much less capable of generating the kind of shared ambition that put people on the moon or sequenced the human genome.

Some technologies can't be built in a niche. Nuclear energy, space exploration, climate engineering need mass legitimacy, political will, public imagination, and collective ambition held together over decades. They are not products of optimisation loops. They come from societies that can imagine the same future at scale and hold that image long enough to build toward it.

Civilizational scale innovation requires shared imagination.

The cultural coordination loop is also becoming one-directional. Previously elite imagination seeded mass culture and mass culture co-opted and fed back into what got built. Now elite imagination stays within elite bubbles. The techno-elite have the capital to make parts of it real. But when that reality reaches the masses, it arrives fully formed. The masses inherit it. They never got to shape it. And that is a problem.

The imagination loop is closing in on itself. And when only a few people dream the future, the rest of us inherit it.

 

So what

A few things to consider:

First, the fragmentation problem is what designers call a wicked problem. It needs the best minds focused on it, and it needs to be solved not through centrally planned mandates but through organic pan-cultural moments that allow science fiction to reclaim its role as a coordination mechanism.

Second, we need to move away from short-termism and regain our confidence to make civilizational bets, celebrate them loudly, and not let them get buried under quarterly returns.

Third, AI should not be about capturing value for the elite. It should be about empowering humanity. It should live up to the comparison that has been evoked of it being like electricity, one that allows humans to remain the builders and not just the prompters.

 

William Gibson famously observed that

'The future is already here, it's just not evenly distributed.'

Fragmentation threatens to make it something more troubling. A future that is not delayed, but simply not built.

 

Origins & Edges is an essay series written as thinking-in-public. Tracing where ideas come from, where they are going and what they might mean next. Across marketing, culture, tech and the craft of designing the self.

 

References

• Ray Bradbury on science fiction as “the fiction of ideas”
• Robert A. Heinlein, “Science Fiction: Its Nature, Faults and Virtues”
• Amazing Stories, Volume 1, Number 1, April 1926
• Britannica, “Did Jules Verne Invent the Submarine?”
• USS Nautilus Museum, “Simon Lake and the Submarine Contest of 1893”
• ITU News, “Arthur C. Clarke”
• Wired, “May 25, 1945: Sci-Fi Author Predicts Future by Inventing It”
• Time, “Martin Cooper”
• Popular Science, “How Star Trek fans changed the name of NASA’s first space shuttle”
• NASA Johnson Space Center Oral Histories Project
• Fred Turner, From Counterculture to Cyberculture, University of Chicago Press excerpt
• InCyber, “Neuromancer: a deep dive into the source of cyberpunk culture”
• Neal Stephenson, “Innovation Starvation,” Wired
• Obayashi Corporation, “The Space Elevator Construction Concept”
• Global Construction Review, “Construction firm plans to build space elevator by 2050”
• Axios, “Silicon Valley fixated on sci fi”
• Arthur C. Clarke’s Third Law, reference overview
• William Gibson quote attribution note, Wikiquote

Note: All images were imagined and created with help of Claude (for image prompts), ChatGPT and Gemini.

Encoded Advantage: Stablecoins and the US Dollar's new layer

Disclaimer: This reflects my own perspective. This is me thinking out loud. It does not represent the views of my employer or any other organisation.

---

Niall Ferguson, in his sweeping history of money The Ascent of Money, makes an important observation

"The evolution of money has been a process of gradual dematerialisation."

From gold coins to paper notes to digital ledger entries. Each step moved money further from a physical thing toward a shared belief. Nowhere is this more relevant today than in the world of fiat currencies, which are themselves moving steadily toward digital form. And stablecoins, and other digital assets, are at the next dimension in this shift. But like every step before them, they carry the assumptions of the world they were born into. My argument is simple: these digital assets, particularly stablecoins, will NOT flatten the existing hierarchy of currencies. They will first clone it, more or less. 

---

Origins: 

Lets focus on stablecoins mainly. It is a digital token that lives on a blockchain, but unlike Bitcoin or Ethereum, its value is pegged to something stable. Usually a currency, like the US dollar. Focusing on the most dominant ones tells us everything we need to know about where the market consensus has landed. More than 90% of fiat-backed stablecoins are pegged to the US dollar, with Tether's USDT and Circle's USDC together accounting for 93% of the total stablecoin market. That concentration has only deepened with regulatory support — in July 2025, the US passed the GENIUS Act, establishing the first formal federal regulatory framework for stablecoins, which has effectively reinforced dollar-linked stablecoins as the standard. So one USDC, issued by Circle, or one USDT, issued by Tether, is supposed to always be worth one dollar. The issuer holds reserves — cash, treasury bills etc — to back that promise. And it is worth noting: Circle and Tether are private enterprises, not governments or central banks. 

Why stablecoins exist at all

Stepping back a little, why did stablecoins come to exist at all? It was not because someone thought "let's make global payments better." That is something that has now been discovered as a benefit. The reason stablecoins emerged was because of a more immediate reason than that. Crypto markets were trading around the clock, 24 hours, 7 days a week, and whenever people wanted to take profits or reduce risk, they needed somewhere to park it and that was not volatile. But moving money in and out of bank accounts is slow. The banking system runs on business hours. The crypto market doesn't. So people needed a stable asset that could move on a crypto network, any time, without going through a bank. Stablecoins solved that.

Over time however, stablecoins stopped being just a workaround for crypto traders. They became genuinely useful for moving money across borders, faster and more cheaply than traditional bank transfers. Today, a SWIFT transfer between countries can take two to five days and carry fees that make small transfers impractical. A stablecoin transfer takes minutes and costs almost nothing. That is a meaningful improvement and banks, institutions and government are waking up to the potential.

This dynamic has precedent in history.

A financial instrument created to solve one problem and then becoming infrastructure for something much bigger, has of course happened before. In 17th century Amsterdam, merchants trading across long distances faced a version of the same challenge. Economic historian Jan de Vries, writing about the commercial revolution of early modern Europe, describes how merchants needed instruments that could move faster than coins could physically travel. They created bills of exchange: IOUs between trusted parties that circulated as a kind of proxy money. Not officially issued by any state. But accepted widely enough to do the job.

What is similar about the Amsterdam example is how these bills evolved. They started as a simple workaround for slow settlement between trading partners. But over time, as historian Herman Van der Wee noted in his research on Antwerp and Amsterdam's financial markets, the bills of exchange became the circulatory system of European trade, moving value across cities and countries in ways that the underlying coin-based system never could have managed at that speed or scale.

Stablecoins are following a similar arc. Started as workaround, but now taking on other roles.

Why trust always concentrates

The Amsterdam bills of exchange reached for the most trusted thing available when it came to collateral. The bills clustered around the most accepted currencies of their day. But why did trust concentrate the way it did? Tommaso Contarini, Governor of Verona in 1541, observed in his proposal to the Venetian senate that the Antwerp market succeeded precisely because of an abundance of trust and a scarcity of fraud — so much so that it obviated the need for public records altogether. Trust, in other words, was the table stakes,  as it is in banking and finances today. Finance afterall is always playing at the intersection of trust and technology.

That trust eventually found its most durable form in Amsterdam. Herman Van der Wee, in The History of European Banking, describes how the private merchant system that preceded the Bank of Amsterdam already understood this:

"...the foundation of the deposit bank in Amsterdam had been preceded by private initiatives of merchants who deposited full-bodied coins... Lenders were protected from repayment in debased coin, for the bankers undertook to pay back the deposits in the same high-quality coins as they had received."

The merchants were building and operating for convenience, but on the back of a promise — that what you put in is what you get back, undiluted. When the Bank of Amsterdam formalised this, it institutionalised something that trust had already made possible. As Stephen Quinn and William Roberds write in their study of the Bank's rise in the American Economic Review:

"The Bank [of Amsterdam] provided a uniform and secure money (bank money) for the settlement of large-value transactions... By providing a stable unit of account and a secure means of payment, the Bank reduced the transaction costs and risks associated with the use of a variety of circulating coins."

Private merchants built trust informally. But backed by a stable value surrogate. Because it was reliable.

And that brings us back to the dollar — and why 90% of stablecoins are pegged to it

Stablecoins went straight to the dollar for the same reason. Because when we need something everyone will accept, we reach for what already works. The dollar was, and remains, that thing.

Even at the beginning, the dollar wasn't just a convenient choice.

---

The shift: 

Now the digital asset optimists are genuinely excited, and not without reason. Stablecoins are growing exponentially. And so are other digital assets. CBDCs are being piloted across dozens of countries. Banks are beginning to tokenise deposits and other assets. The infrastructure is expanding rapidly, and there is real momentum behind the idea that digital money will eventually work the way the internet works — open, interoperable, borderless.

But it is worth noting that there are many structural issues which can slow things down, especially for local-currency stablecoins. Apart from the fact that crypto settlement is one of the key uses of stablecoins, and for the other cases to truly matter there are a few hurdles.

The interoperability argument

In fact, one of the livelier debates in the stablecoin world right now is about interoperability: whether different stablecoins, different blockchains, and different digital currency systems will eventually be able to talk to each other seamlessly. If that happens, the argument goes, then using a euro stablecoin or a Singapore dollar stablecoin would be just as easy as using a dollar one. The friction is reduced.

That is a reasonable. But I think it misses something important about why people choose one currency over another in the first place. Interoperability solves a plumbing problem, but not the trust problem.

The trust problem

Think about what happens when someone in a country with serious inflation gets access to a digital asset like a stablecoin for the first time. What do they want? They want to get out of their local currency. They want something that holds its value and is accepted widely. A stablecoin in their local currency gives them none of that. It's a digital version of exactly the thing they are trying to get away from. Making a weak currency digital doesn't make it attractive.

There's also a trust problem that goes beyond inflation. To trust a local currency stablecoin, you have to trust the currency itself, the company issuing it, whatever they are holding as reserves, the local regulator, the legal system around it. That's a lot of trust to stack up. A dollar stablecoin only asks you to trust the issuer and the dollar. And the dollar has been earning that trust for a long time.

Dollar stablecoins also already won the early race. The so called first mover advantage is staggering. They have depth  with lots of buyers and sellers, lots of places to use them, and institutional adoption. For a non-USD stablecoin to actually scale, it must do more than just exist. It has to be genuinely better for a specific reason in a specific context.

The government problem

Governments make this more complicated too. The optimistic narrative assumes that local stablecoins will grow because regulation enables them. But why would a government that cares about controlling its own currency allow a private stablecoin to compete with it? The more likely outcome is a government-run digital currency as the many CBDC experiments are showing. 

The EU is experimenting with a digital euro, but that's a government project. China's digital yuan exists precisely because the government wants control. These are not yet stories about market demand for local currency stablecoins. They are stories about governments trying to hold onto something.

The local currency case — and its limits

Now, there are genuine cases for local currency stablecoins, and private issuers will find value of this. For purely domestic activity, like doingg local payments, paying salaries, paying suppliers in the same market, holding savings in a familiar currency, a local currency stablecoin makes intuitive sense. And there will be businesses and contexts where this is genuinely useful.

But here is the thing. In most markets, local banking infrastructure for domestic transactions already works reasonably well. Moving money within a country, paying staff, settling with local vendors, these are not the broken parts of the system. Even in countries where digital banking systems are not yet there, and could encourage them to leapfrog to a stablecoin based system, the potential has a ceiling. In fact they can leapfrog to the dollar even in those cases. 

The parts that are slow, expensive, and genuinely painful are cross-border transactions. That is where stablecoins have made their most compelling case: faster than SWIFT, cheaper than correspondent banking, available at any hour.

And cross-border is exactly where local currency stablecoins run into trouble. The moment it becomes about moving money across borders, it is back to the same questions of trust, reserves and acceptance. Who holds this currency at the other end? How easily can it be converted? A Singapore dollar stablecoin moving from Singapore to a supplier in Brazil reintroduces all the friction that a dollar stablecoin was designed to remove. The very problem stablecoins solve — cross-border speed and simplicity — tends to resolve in favour of the currency that everyone already accepts.

---

So where does this leave us

Three things that I see: 

First, the expansion of digital money infrastructure does not automatically translate into demand for more currencies offered in digital forms, however attractive it is. It translates into faster, cheaper movement of whichever currencies people already trust. 

Second, the trust and depth that dollar stablecoins have already built creates a gap that is genuinely hard to close — not impossible, but harder than the optimistic narrative suggests.

Third, the strongest case for local currency stablecoins is domestic, but domestic is also where the problem is least acute. The real prize, cross-border transactions. keeps pointing back to the dollar.

---

The edge: 

Every few decades, a new layer of financial infrastructure gets built. And each time, the question that follows is the same: will this new layer change the balance of power, or will it simply make the existing hegemonies faster and more efficient?

Here there are some counter to expected sense trends at play. The internet did not make every language proliferate equally. It amplified those which were already large. English accounts for nearly 64% of all websites, despite being spoken natively by only 16% of the world's population. And now AI is making this more entrenched, not less. The large language models powering the next layer of the internet are trained predominantly on English data — and MIT researchers have found that even when these models process inputs in other languages, their internal representations default to English as a kind of central processing hub. The technology literally thinks in English. Cable television didn't create new cultural centres either. It extended the reach of existing ones — Hollywood didn't shrink as the world got more screens, it grew. There is a pattern here that the stablecoin conversation can learn from. When a new network expands, the things already flowing most powerfully through it tend to flow even more powerfully. Not because the network is designed that way, but because that is what networks do.

Stablecoins are a new network. And the thing flowing most powerfully through them, from the very beginning, has been the dollar.

"Stablecoins are more likely to reproduce the existing hierarchy of currencies than to flatten it."

So here we are — and here is where I think this goes. The following seem likely. 

First, dollar stablecoin dominance will deepen, not dilute. The dollar goes more digital, spreads further, embeds deeper. Digital dollarisation, not digital cuurency diversity. 

Second, local currency stablecoins will grow selectively and slowly and well be hoisted by regulation and regional necessity rather than genuine user preference. The euro, Singapore dollar, Hong Kong dollar, renminbi will each find their contexts. But there is a difference between existing and mattering at scale, and that difference will take much longer. 

"What if stablecoins are actually how dollar dominance gets written into the new layer of global finance, faster and more embedded than before?"

---

A word of caution:

I am not saying local currency stablecoins won't exist or won't find their footing. They will. But the burden of proof has to reckon with the fundamental human motivations of what provides trust. 

And on top of trust, a local currency stablecoin has to solve a problem that the dollar stablecoin doesn't already solve.

As one economist, David Lubin, put it at a Chatham House discussion on dollar dominance 

“the dollar is the QWERTY keyboard of the international monetary system.”

---

A final thought:

And then there is the question nobody is quite asking yet. When things become digital, costs tend toward zero. That's true for music, for communication, for software. Is that true for money too? And if the cost of moving money approaches zero, does that change anything about which money people want? Or does it just make it easier to want what they already wanted?

I don't have a clean answer to that. But I think it matters. Because if moving money becomes essentially free, the question of which money you move becomes the only question left. 

---

Origins & Edges is an essay series written as thinking-in-public. Tracing where ideas come from, where they are going and what they might mean next. Across marketing, culture, tech and the craft of designing the self.

---

References

• Niall Ferguson: The Ascent of Money: A Financial History of the World (2008, updated 2018)
• TRM Labs: 2025 Crypto Adoption and Stablecoin Usage Report — source for 90%+ USD stablecoin dominance and GENIUS Act
• Federal Reserve: Stablecoins in 2025: Developments and Financial Stability Implications (April 2026) — source for GENIUS Act detail
• Jan de Vries: The Industrious Revolution: Consumer Behavior and the Household Economy, 1650 to the Present (Cambridge University Press, 2008)
• Herman Van der Wee: The History of European Banking (1994, 2nd Ed. 2000), p. 89
• Stephen Quinn and William Roberds: "The Bank of Amsterdam and the Leap to Central Banking" — American Economic Review (2007)
• Centre for Democracy and Technology: Report on AI language bias — source for English accounting for 63.7% of websites
• MIT News: Large Language Models Reason About Diverse Data in a General Way (2025) — source for English as internal processing hub
• David Lubin, Chatham House: Members' discussion — "Is this the end of dollar dominance?" (2025)

Note: All images were imagined and created with help of Claude (for image prompts), ChatGPT and Gemini.