Will AI Agents Use Stablecoins or Virtual Cards?

But I think we're seeing a whole new class of entrepreneurs that start vibe coding that they might have never written code before, and now they're creating projects. But they run into all of these red blocks and these bottlenecks, and what I think about is commerce moments where they got to leave the vibe coding experience and then jump out and try and pay. And so that's why we're so obsessed with this idea of command line commerce of how can you just delegate and give a payment method to your agent and then say, oh, you need to buy a domain name? Great. Here's how you do it. Oh, you need to buy some data? Great. And be able to do that all within that contained environment and like, it is so early. But I think there's like a massive opportunity for cards to become a default payment method there. I think there's a big opportunity for stable coordinates to play role in certain tricks, actually categories. And I think that there's this, it's such a growth area that anytime there's like the zero sum thinking of, oh, it's card versus tables. We're like, there's going to be trillions of dollars of all you going to both. That's like great for everybody. (upbeat music) Welcome to tokenized. The show focused on stable coins and the institutional adoption of tokenized real world assets. My name is Simon Taylor, I'm your host for today. Author at FinTech Brain Food and head of market dev over at Tempo and I'm joined in person by the one and only. Kai Sheffield, head of crypto visa, has a government. It's good to have everyone here in the same place. I think I said it earlier this week. San Francisco is the stable coin capital of the world. I'm sorry New York, it is. And so, we're here at San Francisco in the visa studio. We've got some amazing guests. We've got a lot of news to talk about. Let's get into it. Well speaking of guests yet, Tana today, O of the stable sea, how are you doing, friend? We're good, excited to be here and excited for the conversation. Thank you, Tana. And also joining us is Alfonso Gomez co-founder of CrossFit. How are you doing, sir? I'm great. I'm not sure I agree. SF is stable coin capital of the world just yet, but definitely starting to, at least this week, everyone's a down week for sure. This is definitely stable coin week in San Francisco. For sure, very stable conference. There's all sorts going on. There was frontiers. There's a lot of good stuff. It's been fun to be here. But before we get into the show, I've got to remind everybody that views and opinions of our contributors today are their own. I might not reflect those of companies they represent. Please don't take anything we say as tax legal or financial advice and always do your own research, folks, and stay safe out there. Well, first story this week, we kind of have to mention your news, Kai, something happened with these run bridge. Do you want to tell everybody what it was? Yeah, I'm really excited to be expanding our partnership with Bridge, moving into over 100 countries by the end of the year. And the takeaway here is stable coin link cards are in hyper-growth mode. This was a concept when we started talking about in the show a little over a year ago. We announced, I think it was last April, that we were starting to work with Bridge to issue cards. And we just see incredible demand. That it's hard to keep up with all of the companies coming to us that want to issue stable coin link cards. But it's great to have partners like Bridge that are scaling into new markets, new use cases, and we expect it to continue to grow. Yeah, as the FinTech node, I look at that and I go, people don't realize how hard it was to issue cards in a hundred different markets. You have to go get a bank partnership, market by market. To have one API that can do that is like unbelievable. Tanner, I know you came from block originally, you have some experience in this world. Now with StableC, you're doing stuff cross-border. There's a lot of hidden pain here that people don't see. Yeah, very much so. Some of the pain points that we see in terms of our client segments, like we mostly serve the enterprise. And the enterprises typically have subsidiaries around the world. And some of the main pain points that they're trying to solve are mostly around how you circumvent the refunding times and how you get trapped cash out of emerging markets around the world. So there's a lot of interesting pain points to discover and talk about there. And business use cases with regards to cards are certainly an emerging one too. It was the ultimate stage. So there's like two fastest growing use cases that B2B and StableClineLinkedCard. I'll find some, you've seen StableClineLinkedCard growth yourself. I know you guys have been involved in supporting a number of those companies. Yeah, certainly. Like half of the customers we work with have a StableClineLinkedCard as well, NeoVanx, Remindance Companies. And part of it is to support their use cases, but also it's becoming a pretty good business model taking part of the interchange as well. So for companies that are acquiring users quickly, by using StableClineRails building this kind of NeoVanx, taking money later a little bit on the transactions on the interchanges. It's like one of the most natural things. So there's the main thing we're seeing. I think that's exactly like when we talk to clients, there's both, it's a table stakes feature for your consumers or businesses that if they're holding StableCline's, they want as easy of an off-ramp as possible, but it's also a business model. But for FinTech for decades, you've had massive companies that have been able to be built as they've created great experiences and issued cards that the volume on those cards has been a primary revenue driver. And it's always interesting if you compare it to, if you're building a StableClineRails wallet today, if someone goes and takes your wallet and scans a QR code and pays directly with a merchant, those funds just left your platform and you didn't make any money for it. And it's a worse experience because there are fewer merchants accepted. And so I think it's just become this obvious thing why wouldn't you put a card in the wallet, let someone tap to pay, have it work everywhere and monetize everyone of those transactions. And so it's particularly exciting to me. Like you mentioned that so much of FinTech has been US and Europe and kind of developed market focus, StableClineRails have just inverted that. And now it's like, this is global FinTech. Like this is an ecosystem all over the world that people are building new products that they're unable to monetize, it's global. - That default global thing is something that I heard a lot in the early days of StableClineRails even set it a bunch, but it was a promise, not the reality. I think now it is very much the reality and the bottom's up adoption is huge for that. But then what do people want to do? No matter where they are in the world, they want to buy Netflix and chat GPT and these digital products and services and cards let them do that. It's almost like a great leveler. And what was it, chime until quite recently? And I think still today, the vast majority of their revenue comes from cards. It's the card interchange that's kind of doing it. So I think there's another story we should talk about though, we're talking about cards, which is, Crossman have launched AI agent exclusive virtual cards. So this is virtual cards, not physical cards, because an agent wouldn't hold one, I guess. And it's powered by Visa Intelligent Commerce. The idea being you save a regular card on file and then the agent requests a virtual card number with a spend limit and the agent uses the virtual card up to that limit. So a consumer or somebody else can keep earning their credit card points, but the agent spending on your behalf can go do stuff within those limits. So this is kind of super interesting to me, offence, because this is not necessarily a stable coin backed card, is it if I understand correctly? It's a virtual card for agents for that use case, but you're going that route rather than stable coins. That's right. And we've actually done a lot of integrations with stable coin link cards. However, we're supporting more and more agent users and developers. What we see is, first, on the terms of use cases, people are starting to use agents for more and more things. Most of them is people coding or by coding businesses, trying to make money with OpenClaw. And hitting the limits, the data of OpenClaw, make me money, make no mistakes. So that's the thing is, it was like, make me a million dollars, make no mistakes. And we joke, but I do think it's something pretty big that's happening. But what we hear from all of them is, OK, the moment my OpenClaw is trying to send an email or needs to call some inference API, needs to do some marketing materials, it hits that credit card paywall. And even though the stable coin linked card route works, people want to keep seeing their points. They want to see their balance, the spend in their credit card balance, all those things. And it turns out that you can directly issue virtual cards for agents with the technology from BSAW so that you don't need to do an extra help. So if a customer already has a credit card and they just want to grant it to the agent, you can directly basically get the virtual cards from it. This is not to say, I think agents will probably use both at some point. There will be some agent platforms that maybe have a stable coin balance. There will be others where the primary funding source is a credit card. I think we will see both. However, we see tremendously more of the demand for virtual cards coming directly from our link card on file than the other way around in this market. It's fascinating to me that so much of the discourse is being around X4 or 2 and stable coins of the answer. But actually, as you speak to agent developers, I don't want to download this new software. I don't want to take on this new complexity in order to make a payment. I have this card. Can I just use that thing? And to be it say, yeah, you can. So you say something interesting, which is you think both will coexist and no Levine who's now at Andreessen used to be at these are really great pieces. Kind of along those lines saying that the merchant of tomorrow is maybe somebody who is vibe coded a thing doesn't necessarily have a business yet. Wouldn't pass the basic onboarding as for even for somebody like a striper or an ad you know something like that. But they have their own card and they want to give that to somebody and they want to be able to make payments with it. So I think that's a super fascinating space. Carrie, where are you? Is it like cards all the way or are you still stable minded? I think that there's absolutely a role for both. I think the most exciting thing to me is that vibe coding has changed a lot of the conversation about agente commerce. I feel like even six months ago, the conversation on "Gentic Commerce" was, I'm in chat GPT, I'm searching for shoes. Like, can you help me find shoes and buy them? And like, that's still a use case. And like, we're doing a bunch of work in that area. And like, I always see this more kind of conversational commerce. And it's like an incremental step of what people do today. Now we're just in this entirely new world where the value prop to the consumer of agente commerce is less about saving time. And it's more about creating value or creating money. And so personally, I think it's a lot more interesting to have an agente co-founder than an agente shopping assistant. And like, being able to say, OK, can I delegate my card and give you some instructions? Hopefully, they're more specific than make a billion dollars big dough mistakes. And like, you can have some more specific props. But I think we're seeing a whole new class of entrepreneurs that start vibe coding that they might have never written code before. And now they're creating projects. But they run into all of these roadblocks and these bottlenecks. And what I think about is commerce moments where they got to leave the vibe coding experience and then jump out and try and pay. Great. Great. And be able to do that all within that contained environment. And like, it is so early. And I think that there's this, it's such a growth area that anytime there's like the zero sum think you have, oh, it's card versus tables. We're like, there's going to be trillions of dollars of volume going to both. That's like, great for everybody. But I don't know, Tanner, how do you think about a gentick? Are you going deep down this rabbit hole or are you guys at StableC doing anything around it? Yeah, we're experimenting in some beta environments at the moment. I mean, keep in mind, like StableC, we serve a different audience. So like we go after real economy enterprise companies that have been around for 50 years, 100 years, 150 years. And they have deep supply chains. They have subsidiaries all over the world. And what StableC provisions to them is not just API and stablecoin infrastructure, but it's also a stablecoin treasury platform that is like all on Whip3. Right. What that means is that there's a human that logs into the StableC platform and they can use it for different use cases, whether it be cross-border treasury movements, access to capital markets products, including tokenized money market funds, and then coming soon, access to on-chain lines of working capital for loans. And so one of the things that we're experimenting with, which is by no means in production today, but is how you can have essentially like an AI agent that serves as your de facto chief of staff to the CFO. Like can it manage your treasury across two or three different subsidiaries where you have free cash flow or spare idle cash and like Argentine peso, spare idle cash in South African Rand and US dollar and you can convert into and out of and then park that in a money market fund and then come back into it. So we're exploring the agentic world, but not as it relates to commerce necessarily, it's more in the C-R-Sweet. It's the treasury management. And I think that gets forgot again. We have the stablecoin link card and the consumer and the business use case, but you also have the treasury management use case. And it's those are the two big ones that we keep coming back to. There's sure, never look at 10 alabs is doing a lot of similar things around helping companies with treasury management, but with stablecoins and agents. And I think that is going to be a coming trend for sure. Alfonso, I want to come back to you on this point just to explore it a bit more. Where specifically would stablecoins benefit or have some role in this ecosystem? Because I never want to be the show that's like, oh, well, we talk about stablecoins or stablecoins or the answer. It's like a credible case here. So first I want to say, we started serving the agentic finance ecosystem a year ago and at the beginning we started thinking, it just would just stablecoins for everything. And then we hit the market. We hit people and realized that was not what people were looking for. The way I would, I see your mental model is the following. I think first in agenteic finance, there's actually two entities. There's the human and then the agent attacks one behalf of the human. I think humans as the entry point in places like US, Europe are starting with credit card and will continue to do for probably for sale of future. Maybe it's different in global sell to other places. And then second, the agent, really the agent can handle the complexity of on-run paying switching from one or another, as long as it has the tools like virtual cards. And what we see is, it depends on what the agent wants to do. We see, but as a majority of you want to buy a domain or you want to hire Twilio to send SMS or things like that, those things naturally the agent will find a credit card form. And I think in those existing merchants, things are not going to change. However, this new kind of micro services build entirely for this vertical where the people creating this new merchants are not going through the process of creating a start account and things like that, where stablecoin acceptance is starting to become an arm. So I would say the things that I see are AI inference, paying for compute. A lot of these, like basically new libraries just need. Yeah, it's the new products, the new supply chain thing they need. And I think part of it is very because these people are writing these services like from the toilet, like by going with the agent, you cannot bother with the onboarding process. And also it may be hard to underwrite. How do you underwrite with a stripe or something like that? I created this API that I don't know if it runs. Or if it works or not, I want to start accepting payments and all that stuff. It's possible the onboarding process becomes easier than the line. But today is much easier to spin and explore to facetidator or other similar standards that are coming out and just start taking famous. It's so important to break it down. I like the consumer side and the merchant side. And I think there are like different value props and considerations on each. There are a few things that drive me crazier today than when I hear the argument that, oh, AI agents aren't going to be able to get bank accounts. So they have to use stable quits. And they're like, wait a minute. Every agent is created or controlled by some human. And that human probably has a bank account, probably has a card. And that agent is working for the human. And so why can't that human delegate their credential to that agent? And so this idea that agents are this like weird new life forum that is like entirely detached and not connected. Like maybe at some point in the future, but that's a scary world that I don't think most people want to live in. I think you want to have like, you could point to the person or the developer that is behind that agent. And if that's the case, that developer surely thinks that's on the consumer side. On the merchant side, I think there is this really interesting point of the process of creating a merchant has gotten so much easier with vibe coding that you can go. You're you're light of like someone sitting on the toilet can launch a service that they want to try and get someone to pay for. And like that is not today what payment card acceptance was designed for. Not to say that that couldn't be in the near term. And so it is interesting to see that stablecoins have started to play this role that is like the longest tail of the long tail in some cases of fastest possible way that you can launch a service and get paid for it. I think the question is, is it just a way that you can test and it's like a niche service that like you could see if it works and then you go and open up an account and you accept cards? Are there other unique benefits that stablecoins can have with smart contracts and things for certain use cases? And so how do you think about that right now? Like when it makes sense on the merchant side? I think it makes sense when the merchant is this type of merchant that doesn't exist yet and they're trying to sell something new and the onboarding would be too high. So the metaphor I want to give you is when Stripe came along and they were first meeting a bunch of investors, a lot of investors turned them down because Stripe would go out. The Colossans would say, yeah, we're building for a customer that doesn't exist yet. And then what? Why? How am I going to invest in you? So when we're not trying to win people over, we think developers will be the next customer of software and creating merchants and our entire go-to-market is built around developers. I think there's a new type of developer, which is the Vibe Coder and there's also a new type of customer which is the agent themselves and what they necessarily need to do. And I love the point you made off, Onzo, which is, and what they're selling might be different. So the merchant doesn't exist yet, so they don't already have the ability to accept cards. For those merchants, accept cards, you might as well continue. They don't exist yet. And the hurdle of becoming somebody who can accept cards today might be a little bit high, so I can start with selling this thing by a stable coin. But maybe people want protections when they're buying them, so they might still want to pay for that with cards on the consumer side, which is why I think the acceptance of stable coins is increasing. So I think about it as like, who's that merchant and what are they selling and how mature are they? And that kind of gives you a rubric. I also think there's something really nice about the fact that people forget that stable coins sit underneath cards already today. So where stable coins fit is, do you want to get paid out instantly as a merchant? Because you're already doing instant settlement or same-day settlement cross-border with Visa Direct with a number of companies. So I'm a merchant, I'm anywhere in the world and I'm selling widgets and instead of waiting the weekend to get paid so I can buy more widgets, I can get paid now and I can have more inventory and I can sell more widgets. That makes the velocity go faster. Now think about tokens or digital resources. I don't know if you guys have looked at your API bills lately. I have. Token bills add up. Until you figure out the whole OAuth token thing, like, yeah, it's token bills add up and so there's a generation of vibe coders figuring out, oh crap, I just run out of my entire budget of tokens really, really quickly because my product took off and was really popular. If I could just get paid faster, then I could have more inventory for tokens and my product could sell more. So I think we have to collapse this gap between all of them, often supplement to be near real time in order for these businesses to take off every really succeeded the speed of a machine commerce. That's kind of how I'm thinking about it. I'll find some of the thoughts before we move on to the next story. I just think so. I think this is very interesting and I wonder and we'll see how Card Networks now start updating to embrace. I think this fact that there's these new folks that have that don't want to maybe unbore through the folks or agents that don't want to unbore through the traditional processes. However, consumers may want to have sometimes the protection or other things that comes with that. And I wonder if in the future we will see something like an onboarding from something that starts like a vibe code, it's table coin thing and then suddenly becomes another and then at work or something like that. That is to me something I think I'll about then I expect will happen that one more question for you actually. In your own sort of coding workflows, are you sort of using swarms of agents agents and sub agents do you have that sort of setup when you're building products as a comah fee. Could you imagine a world where you did have like a chief of staff to the CFO, but they also had a financial controller and lots of other employees and each of those would have different roles and different kind of limits and things they could do. My hypothesis is that there's a limit to how many times you can issue each of them a virtual card without having to build ramp or brex in order to manage your finances. This is something where I think stablecoins could also play quite an interesting role because they're naturally programmable, they're naturally global, they're naturally 24/7. So thank you for coming to my TED Talk. Whilst we're taking a quick pause, we just want to thank our sponsors and we'll be right back. This episode, if it's not obvious, is brought to you by our friends at Visa. A global leader in payments, Visa's tokenized assets platform, VTAP, user smart contracts and cryptography to help banks bring Fiat currencies on chain. VTAP allows financial institutions to issue Fiat back tokens, improving financial efficiency and enabling programmable finance. You can check out the links in this episode's description to express your interest in VTAP. This episode is sponsored by Stripe. Here's the thing, selling digital goods globally is still far from easy. Many of the people around the world that want your product don't have an easy way to pay you. They simply don't have access to cards or a bank account. Stablecoin payments change this. They're the first truly global payment method that you can use from anywhere. That's why for any business with global growth ambitions, accepting stablecoin payments is table stakes. With Stripe doing so as easy as flipping a switch, from big names like Shopify to fast growing names like Shadeform, businesses, everywhere, trust Stripe to accept stablecoin payments from everyone everywhere. See what's possible at Stripe.com/crypto. Tokenized is also sponsored by Fireblocks. Fireblocks is the stablecoin infrastructure of choice for global businesses from visa to wallpaper to bridge to revenue. With over $100 billion in monthly stablecoin volume, Fireblocks powers stablecoin strategies at scale with infrastructure that enables PSP, Fintechs, remittas and banks to issue, move, hold and manage stablecoin. It's all done securely at scale with secure built-in compliance. With Fireblocks, you get complete control to build your unstablecoin orchestration layer, create payment accounts, manage liquidity and access on and off ramps in over 60 currencies. Makes it easier for you to build and scale and expand your business globally. Learn more at Fireblocks.com. Thank you to our sponsors. The next story this week was about Morgan Stanley. They have applied to be a national trust bank to custody crypto and potentially do all the things that the other folks are doing. So they've applied for this denovo national trust charter. The new entity Morgan Stanley digital trust aims to own custody settlement and fiduciary plumbing for blockchain finance under US bank supervision. They also plan to introduce Bitcoin, Aether and Salona trading through each trade in H1 2026. Tanner, I'm going to come to you in this. You obviously know Morgan Stanley and their role in financial markets quite well. Why do you think they'd be doing something like this given what they've been historically? Yeah, I mean, if you look at banks across the board, Morgan Stanley included, you're seeing a lot of them tokenize their RWAs, whether that be their money markets, their treasury bills, on chain private credit is becoming a thing. And then stable coins, you know, different city has city coin, JP Morgan has its own coin too. And I think the demand that you're seeing, which prompts banks like Morgan Stanley to jump into this race, is that there's a lot of efficiency gains in the treasury space. For large merchants, mid market merchants, etc. both on the asset management side on how you manage your free cash flow and then on your supplier payments and on your treasury movements, generally speaking globally. And if you look at like the transaction banks more broadly, like a Goldman or city or JP or HSBC, standard trader, all these companies, of course they have their investment banking divisions, but also from a merchant banking perspective, they have their transaction banking teams. And the transaction banking teams is where you have a pretty good margin there, but you are essentially the back office to some of the biggest companies in the world and you manage with futures and forwards and swaps and derivatives on the capital market side, you manage the treasury movements around the world, you manage the FX spreads. And I think you're seeing now that you typically needed a lot of humans and infrastructure from the early 2000s to manage a lot of that stuff. And now you're realizing that startups and more tech forward companies can come and provision some of those services. And so the banks are naturally, they have their distribution with their customers, and they want to make sure that they're offering best in class, you know, financial services up to par there. And so any thoughts on more people applying for charges has been a wave of them recently. I always have them, but I'm a tech guy. I was made by the agents. I have no idea. Yeah, there's a great part. Any thoughts on this one, Kay. I always like to start for the point of my hypothesis is that over the next decade, every financial institution is going to want to come on chain in some way. And I think it'll be different for different financial decisions and different markets and it could be capital markets. They wanted to talk about securities. It could be B to B payments, could be remitses, could be on chain lending. Like there are all these use cases, but the lowest common denominator is, okay, well, you're using a blockchain ledger and there's some asset on that ledger and you're basically offering a wallet capability to customers to interact with that ledger. And so if you work backwards from like, how do we get there? You know, if that's going to happen over the next decade, I think for this story, it's interesting to see like where do banks in large FIs and asset managers, where do they invest in building and kind of going on their own to do things in house that they control. And what parts do they outsource? And I think we've seen a trend of P and C, I believe, an outside partnership with Coinbase, you know, using Coinbase sub custody, where they can now offer Bitcoin and other assets to their customers. And we've seen some other banks go down that path as well. And I think when the products were really crypto trading and you have this rush of banks and FIs saying, how do we help our clients like buy Bitcoin? And it seemed like the default instinct was we got to move fast, we got to get to market, we're just going to outsource, we don't have all the necessary licenses like to do it, we don't want to explain our regulars, we're just going to be an interface. And we're going to let our customers buy Bitcoin and we'll plug somebody else in on the back. I think what's interesting now is the demand in the use cases that a lot of these larger FIs are looking at, it's really not just buying Bitcoin anymore. It's tokenizing securities, it's using tokenized assets as collateral, it's on chain, it's all these things that are not like a nice to have feature that might be good for a press release. It's actually the core guts of the product that they're in the business of offering. And so what I really wonder is, if you're a large FI and you're trying to figure out how do I make like a long term strategic plan, how do you balance speed to market where it's likely faster? Because a lot of these FIs don't actually have the right licensing and approach to offer some of these assets to do sub-custody relationships with outsource versus where do you say, you know what? We're going to have to apply to get a charter. And a lot of people are like, wait, Morgan Stanley, they're already like a regular financial situation, but it seems like they didn't have whatever the necessary licensing was to offer the products that they wanted. And so now you have large FIs applying for new charters. And then you could say the same thing about okay, well what do they do about custody? What do they do about nodes? What do we do about all these areas? What do you build? What do you apply and go get versus what do you outsource? And I think that's like the discussion happening in boardrooms of many large financial institutions. - I don't know how many times you get asked that in a weekly basis, but it's pretty much the dominant conversation I have with financial institutions is Simon, who should we work with? But also I kind of want to build it myself one day. So how do I do something now? So I don't miss the market and I can meet the moment. But also how do I get closer to the metal over time? What's my journey and my guide path look like? And I'm like, well, I've drawn you lots of slides. Here you go. But then really what you have to do is educate people on who all the players are the ecosystem are and then what they all do and how it's different to try to find. And then they go meet some of the vendors and the vendors are all at different levels of maturity and not necessarily the maturity of banquet expect. I mean, Tana, you must come across this all the time where enterprises expect a certain level of diligence from an organization and the crypto ecosystem is not ready for that. - Yep, that's about right. I mean, the interesting part is that with the enterprises, well, I think just to cap that point off on the financial institution point is that the longer term trend that we're seeing is that right now a lot of the tech companies they have some sort of regulatory arbitrage. They were first to market regulation hasn't caught up yet. Therefore, they're capturing this arb on whatever Web 3 product that they're provisioning. But you're seeing now the bank say, okay, this is going to be a thing in the next five, 10, 15 years. I need to set up my licensing structure and away and then bring this stuff in house. And so it's a really interesting signal for the market because it's being institutionalized by the largest financial institutions in the world and they might start off with a partner or by strategy and then they might build it themselves over time. But the one signal that is emerging that is absolutely clear is that on-chain Web 3 financial services are here to stay and all the banks and new banks are posturing for the right regulatory status so that they can crush the arb in the next three, five, seven years. So that's a really interesting signal to pay attention to. Well, related stories, Kraken received work from the Kansas Fed that they will be the first to get a payments master account. So obviously that gives them access to Fedwire and FedACH in all of those underlying systems. And it does so with meaningfully different unit economics than they would have otherwise had. And whether you believe in debanking or not or derisking, it also means that as a Wyoming special purpose depository institution, they're in a position where their payments will still work so long as their regulator allows that to happen. So meaningfully different on that point, Tana, Alfonso, interested in your views on Kraken and the consumer perception of safety of some of these things and how wallets are sort of changing shape over time. Kraken has done crack, the consumer wallet, their institutional. Do you think these exchanges are going to be the next big institutions and do you think consumers will like it? I think it's all a matter of how do they earn user trust and part of this is for example, potentially looking more or actually being more like a bank. But there's also things on the branding side that they may need to cover. This is a bit of a fantasize, but for example, something like here, negatively sometimes is that some new banks, for example, integrating maybe some UI that puts going based on where things like this. And even though for us here, that looks like a great brand. They see, oh, this is crypto and kind of scare out. And so I think for Kraken to do this, I think the other thing is they need probably a very different brand, probably something that feels independent of what they're targeting. But they are trying to expand the pie from what we're talking about before. To end this is important, but the most important thing is how do you convince my mother that this is a safe place to put more yarn and a lot of it is on thinking harder than how to change the user interface on the products that you're creating and how to do the product proposition you have for those folks that really don't care if there's crypto or not on it. It's really interesting to me the story of just how the starting assumptions of the Fintech landscape in the US have shifted so quickly over the past few years. Five years ago, if you were building a Fintech, there were like two pretty strong assumptions that, like if you were trying to raise money, it's like you could not say like, oh, we're gonna like go against these. And that was one, if you're a Fintech, there's this like binary, if you're either a Fintech in your tech company, or you're a fully chartered bank. And there's nothing in between. There wasn't like a, oh, there's this special purpose charter that lets you do some things, but not other than it was like, you're a Fintech, or you're like a full bank. And are you building a full bank? You're not? Okay, then you're a Fintech. Like there was nothing in between. And then it was, don't even think about getting a master's account. Like that's not gonna happen. That's never happened before. Like that could shut down. And so those are just two operating assumptions that every Fintech entrepreneur had to just live with. And there was really nothing they could do. Now, regardless of whether you agree or it's right or wrong and banks have strong views versus Fintechs, the reality is the assumptions now have changed. And the world that we live in, there's another option. There are charters that are being given to Fintechs that are getting some of the access and regulation of banks, but are special purpose that are not full deposit taking banks. And now with this story, there's a path to get a master account. Now it might be a skinny master account, like not full bank, but like that didn't exist before. Yeah. And so I think it's really interesting when those like big plates shift that change the market structure of Fintech, what does that mean for the new products that are built? And like once that door opens up, it's not like, oh, there's like one or two charters. It's like every week. It's like another charter hours. It's style. Cool and ripple and but new bank and a revolute filed for a charter. I mean, the market is gonna look so different in a couple years time. And new bank and revolute have both been doing crypto for a long time for their core customer bases in other markets with charters. If you know, new banks call businesses lending, this is fundamentally a deposit taking institution that lends. So, Tanner, you're probably familiar with the whole history of the renter chart or model and kind of everything that went wrong in the banking as a service universe way back when. Is there some element of these companies as well being in control of their undestinement because being on top of somebody else's charters is actually a risk to your own business? Yes, I think that that's the case. And that's why we're seeing a lot of new banks and fintechs start to apply for their own charters. The interesting thing too is that historically, if you were a fintech and you wanted to offer financial services, you go to one of the sponsor banks, right? No, I'm there. And the sponsor banks were clear that like you're either a crypto institution or you're not, right? And they had to categorize you in a certain kind of subset. And I was having a conversation with a few of them a few months ago. And we were just sitting around having a coffee, talking about how the lines are becoming blurred. Like what is the crypto company? Right? Like when JP Morgan has a stablecoin, are they a crypto company? Oh no, they're a bank and they're using a technological paradigm, right? And like if you look at ramp or bricks or any of these companies, they're not crypto, but they're now adding stablecoins and a lot of the sponsor banks even or their core customers are coming and saying, hey, we want to accept stablecoin as a settlement layer or we want to provision stablecoin, X, Y, and Z product and service. Does that mean that they have to move them into a high risk category? Yeah. And so it's all being morphed into one today. I think that forcing of the risk appetite, window shifting is such a brilliant observation because just earlier today, I had somebody say to me who works in a technology company that serves the crypto industry, say, oh, we can't send it to national wires because our FinTech NeoBank uses this other cross-border FinTech who uses this sponsor bank who flagged it as crypto, even though we're a software company. And there are so many banks out there that wrote their policies for the reality of a few years ago and the reality is really shifted. So now it's a case of, you can't have that binary, oh, it's crypto, it's banned, oh, it's not, it's fine. That's sort of binary risk appetite. You have to get nuanced and your risk appetite. And I think what's really interesting about that is part of this was a function of the speculative hype cycles of crypto. People forget that the times when a lot of things happen that institutions had to deal with crypto, crypto risk, was it wasn't like they had years to figure it out. It was like 2017. Whoa, like everyone's buying crypto. It's like, app it all the sudden, like, what do we do? Oh, it's like, don't worry about it. Yeah, it's $221. Whoa, everyone's like buying crypto. Like, what do we do? And so I think that what happened was in a lot of cases, there was this like very quick reactionary, like this is scary, this is risky. We have to do something. And then you had crypto became a category, literally just crypto. And then crypto became a restricted category. And so for a lot of institutions, we've seen this firsthand many times. You would have companies who, when you go and create a bank account and you go and like, apply for licenses, you talk about like, what do you serve? And you would have crypto show up as a restricted category. And so you'd have companies say, we do not do crypto. And if you said we do not do crypto, there wasn't really a like legal definition of what is crypto. Like does this company use a database that happens to have a chain of blocks like without it? Like there's no definition. It was just a scary thing that happened very quickly. And I think now, fortunately, and like this takes a lot longer to unwind than it took to create, now people are going back and saying, all right, when we said we don't do crypto, what does that mean? Here are all these companies that actually are our own customers who are now adding stablecoins. Do we have to off board some of our largest customers today? 'Cause they now use a blockchain database. I don't think we're going to do that. we want to do that. And so let's go and add some new unsensable, what does crypto mean? What are the risks? How is it different? And so I think a lot of that work is happening inside a lot of financial institutions and with a lot of regulators. And I think that's a very positive productive thing because if you look back and you say, crypto as one monolithic category is not that useful of a real approach for like risk-based decisions, given that it's so broad, and whether someone's dealing with memecoin trading or whether someone is using a tokenized deposit, are like very, very different activities that both could arguably be bucket under crypto. So I'm excited for that to get unwound into like more rational things. - So seeing you use crypto technology these days is a little bit like saying you use the internet. Like who doesn't? It's such a difficult thing to buy for Kate. Conscious of the time. So I'm gonna do some quick fire stories. We didn't have time to cover. The Bank of England stablecoin regime was criticized by innovate finance to chill the UK market. And I do as a UK citizen have some sympathy for that view, but we'll have some folks on from the Bank of England soon to talk about some other stuff they're doing. So shout out to those guys. They are doing some interesting things. So called launch nano payments and testnet. It gas-free USDC micro transfers for AI agents. Don't know if you saw this one. I'll find any thoughts on that. I haven't played with the APIs yet. However, it all seems on the direction of we're talking earlier for micro payments for meter services. There seems to be a battle for standards now like X42 with different versions of a few other companies launching their own. And I do think right now we haven't seen a standard that's strong enough that has taken off. I think a few companies are trying to get stuff on it. - Yeah, let's see. Watch this face. So we also saw MoonPay M0 and PayPal launch PYUSDX, which is a branded stablecoin framework backed by PayPal USD. So this wrapping of stablecoins is becoming really interesting. Shout out to M0, quietly doing lots of interesting things. Northern Trust launched tokenized Treasury money market funds on the BNY liquidity direct. Do you know what that is, Tana? I didn't follow the story. No. And then zero hatch, not to be left out of seeking a national trust child from the OCC as well. And the story that just took me by surprise was the New York Stock Exchange parent company ICE has invested in crypto exchange, OKX, at a $25 billion valuation. Kai, could you imagine that a couple of years ago? - I mean, they invested it or created backed. So there was like a Bitcoin exchange that in the York Stock Exchange pair company was attuned. And I don't know what the status of back is now, but does it seem like that played out in the way that they were hoping? And so it looks like they're taking another shot at it and then they did polymarket before. So I think it makes sense. It's clear that the large exchanges, OKX, being kind of one of the larger ones are still very valuable trading businesses. And anyone who's in the business of an exchange needs some type of crypto strategy of like, what's going to be your bet? So I'm not that surprised to see. - Yeah, we're doing all this. I think the theme of today is everybody having to adjust to the new reality in so many ways. Well, look, that's all the stories we had for this week. I want to thank everybody for watching and listening. I want to remind you all to like and subscribe and do all of those things, spam all of your friends to find the show. We grow organically. We grow because of you. So please help us out. Tana, if people want to find out more about you and stay will see what do they go to do that. - StableC.com and we'll find us on LinkedIn and Twitter and all the normal places. - How fun so how about you? - Probably search us on Twitter, cross-ment. We'll have a lot of those things coming out, and then it's really. - Ooh, four shadowing, four shadowing. I like the sound of that. I can't have it yet. - You guys are shipping. Like, shout out to the CrossFit folks. On XXKShift field at vc.com/crypto. - You'll find me at s white tailor on all the social, screaming into the void at FinTechBrandfood.com and of course the Tempo.XYZ. And thank you so much to everybody. We will catch you next time. (upbeat music) (upbeat music)