Speaker 1: You know, I saw first name. My whole life is
Speaker 1: that institutional capital is that pool is much larger than retail, right.
Speaker 1: And so by going to businesses and saying hey, we
Speaker 1: can offer a better model for you versus the status quo.
Speaker 1: You know, if you support a USD and utilize us right,
Speaker 1: they are now in turn going to their users and saying, hey,
Speaker 1: actually we're going to build our best products around AUSD
Speaker 1: because we're actually part of this economic value chain.
Speaker 2: This content is brought to you by v chain, which
Speaker 2: is a leading enterprise grade Layer one public blockchain spearheating
Speaker 2: a digital revolution from a sustainable, highly scalable smart contract platform.
Speaker 2: The v chain blockchain has many unique features, which makes
Speaker 2: it an ideal choice for Web three applications. V chain
Speaker 2: is working with many great enterprises such as Pwcgvonchi, BMW
Speaker 2: and Walmart China. Most recently, they partnered with the Boston
Speaker 2: Consulting Group to build a revolutionary decentralized application ecosystem. I'm
Speaker 2: a big believer in this project. I have been since
Speaker 2: twenty eighteen. I've been a VET token holder for years.
Speaker 2: And this blockchain is highly scalable, great with security and speed,
Speaker 2: and it has low energy consumption. If you'd like to
Speaker 2: learn more about v chain, please visit vchain dot org.
Speaker 2: Link will be in a description. Welcome into the Thinking
Speaker 2: Crypto podcast. I'm your host, Tony Edward, and my guest
Speaker 2: today is Nick van Eck, who's the founder of Agora. Nick.
Speaker 2: Great to have you on.
Speaker 1: Yeah, thanks for having me, Tony.
Speaker 2: Nick. Agora launch a stable coin AUSD. I have a
Speaker 2: lot of questions around that and how the stable coin
Speaker 2: will be used, But let's start with your background. Tell
Speaker 2: us a bit about yourself and your professional background.
Speaker 1: Yeah, so I spent most of my career as a
Speaker 1: technology investor. My family runs an assa management business, so
Speaker 1: it may not be a surprise that I got into
Speaker 1: marcus and investing at a very early age. Always you
Speaker 1: really thought that I wanted to get into the investing
Speaker 1: world and make that that my career, and so I started,
Speaker 1: uh you right out of school, focused primarily and enterprise
Speaker 1: software at the growth stage, uh, and did that for
Speaker 1: most of my career before starting a Gora.
Speaker 2: UH.
Speaker 1: Moved on to another firm called General Catalyst, which is
Speaker 1: a large multi stage venture firm. Did much of the
Speaker 1: same there, uh, But then DeFi summer came around and
Speaker 1: slowly all my personal time got sucked up by crypto.
Speaker 1: UH and having spent you know, my my day job
Speaker 1: and in cloud software, I felt that blockchain was deep
Speaker 1: back end innovation the financial services and UH payment companies
Speaker 1: never had and that blockchain would eat those world that
Speaker 1: that world in a very similar way to how cloud
Speaker 1: ate on prem and a lot of human driven workflows
Speaker 1: UH within within cloud software. And so UH decided to
Speaker 1: start a Goora about a year and a half ago.
Speaker 1: Officially started in about a year ago today, and yeah,
Speaker 1: we've been growing for quickly and it's been a pretty
Speaker 1: busy year.
Speaker 2: Well congrats on one year anniversary. Amazing stuff. And I
Speaker 2: want folks to understand your background, your family. Your dad
Speaker 2: is of course yan Evan k K is one of
Speaker 2: the big firms out there, and I followed your father
Speaker 2: for years and learning about investments. You mentioned that you know,
Speaker 2: your natural path was to go into the finance and
Speaker 2: so forth. But how did you kind of discover crypto
Speaker 2: and did you tell your father about that or how
Speaker 2: did you guys both discover crypto.
Speaker 1: Yeah, so I actually started uh, you know, my own
Speaker 1: portfolio when I was younger than thirteen, and my dad
Speaker 1: managed on behalf of me, and I spent my years
Speaker 1: in summers in college trying to figure out what I
Speaker 1: wanted to do in the investing role, because there's a
Speaker 1: lot of different things you could do. You could do
Speaker 1: passive management, like a lot of what van x business is.
Speaker 1: You're like ets and just design good products, index products.
Speaker 1: You can actively manage, you know, whether that's like a
Speaker 1: long short hedge fund, you can do to buy out
Speaker 1: you know, VC. And so I was trying to figure
Speaker 1: out what I really liked, you know, I liked you know,
Speaker 1: what I liked specifically about investing is the intellectual curiosity
Speaker 1: required that you were competing with, in my view, some
Speaker 1: of the smartest people in the world, because there was
Speaker 1: a lot at stake, and then you had to put
Speaker 1: your money where your mouth is. And I felt that,
Speaker 1: you know, most people didn't do that in sort of
Speaker 1: the rest of the world. And so I spent my
Speaker 1: summer trying to figure out what I wanted to do.
Speaker 1: Was working for a hedge fund one summer, and they
Speaker 1: were actually buying bitcoin at the time. This was a
Speaker 1: twenty billion dollar deep value hedge fund in its peak,
Speaker 1: and the founders of the firm were very intellectually curious.
Speaker 1: We're like, you know, why are there these three thousand
Speaker 1: cryptocurrencies that have already been launched. And this was you know,
Speaker 1: early twenty sixteen. Most of the other crypto there's like
Speaker 1: like coin, and then it was you know, raven coin,
Speaker 1: rails blocks, et cetera. And they had this view that
Speaker 1: bitcoin was going to eat a large chunk of the
Speaker 1: gold market. And that was something that you know, immediately
Speaker 1: resonated with me because my family runs one of the
Speaker 1: largest gold minor funds in the world, and so I
Speaker 1: sort of grew up getting cougarrants for my grandfather and
Speaker 1: you know, grew up around a bunch of gold bugs,
Speaker 1: and so that's when I first got exposed to it.
Speaker 1: You know, it took me about a year to convince
Speaker 1: him that bitcoin was like this real, real thing, but
Speaker 1: you know, he's very open minded and sort of dove
Speaker 1: right in. And van k was the first institutional firm
Speaker 1: to file for a bitcoin e TF. They did that
Speaker 1: back in twenty seventeen. And then, you know, I I
Speaker 1: liked the hedge fund, but realized that it was a
Speaker 1: little bit too short term and I wanted to focus
Speaker 1: on more long term projects and so found my way
Speaker 1: into technology investing. I really liked that you were building
Speaker 1: companies at the front end of the tech curve and
Speaker 1: building teams versus financial engineering, which was a lot of
Speaker 1: what buy out private equity was, and so love that
Speaker 1: did that for over five years. But it was very
Speaker 1: clear to me that like blockchain was finally at the
Speaker 1: point where it was going to eat financial services and payments.
Speaker 1: And when I got into crypto, eth was trading it
Speaker 1: like a few bucks. There were no no real DAPs,
Speaker 1: like not really that many real users either, you know,
Speaker 1: and even after the I c O boom, there still
Speaker 1: was not much going on. It was really like DeFi
Speaker 1: Summer that I think was the first true step function
Speaker 1: change in like crypto applications and usage. And to me,
Speaker 1: you know, with stables, they were just the stepping stone
Speaker 1: into like the broader institutional adoption of blockchain technology. And
Speaker 1: you know, we felt that we could build a bit
Speaker 1: a better model, and so left my firm about a
Speaker 1: year ago to start a Goora And yeah, it's been busy.
Speaker 2: Wow, So are you are you targeting more of the
Speaker 2: enterprise level adoption of this stable coin AUSD or will
Speaker 2: it also have a retail market, kind of like the
Speaker 2: tethers and the USDC and so forth.
Speaker 1: Yeah, Ultimately, I think any healthy market has a combination
Speaker 1: of both institutions and retail. For US, I would say,
Speaker 1: we're more focused on going after, you know, the businesses
Speaker 1: and using those businesses as our go to market engine
Speaker 1: to the rest of the market. Something you know that
Speaker 1: you know I saw first shame my whole life is
Speaker 1: that institutional capital is that pool is much larger than retail, right,
Speaker 1: And so by going to businesses and saying, hey, we
Speaker 1: can offer a better model for you versus the status quo.
Speaker 1: You know, if you support a us D and utilize
Speaker 1: us right, they are now in turn going to their
Speaker 1: users and saying, hey, actually we're going to build our
Speaker 1: best products around a USD because we're actually part of
Speaker 1: this economic value chain. Whereas with the USDC, about half
Speaker 1: the income of USDC goes to coinbase, the other half
Speaker 1: coast to Circle. And so if you're a centralized exchange
Speaker 1: or a custodian or ADAP that is not you know,
Speaker 1: one of those two companies, you're cut out from that
Speaker 1: economic value chain. And the same is true for everyone.
Speaker 1: But tether right. And so what we're doing is we're
Speaker 1: going to exchanges, adapts, whomever and saying hey, you know,
Speaker 1: you know you should be part of this, right. It's
Speaker 1: actually you that is driving utility and liquidity for these assets.
Speaker 1: And you know by incorporating Agora into your into your app, like,
Speaker 1: you know, you'll have a better business, right. And so
Speaker 1: that's resonating with a lot of people. And so a
Speaker 1: lot of these businesses are then either reducing on and
Speaker 1: off ramp fees around a USD, reducing trading fees, you know,
Speaker 1: being their points program for a USDU. You know there's
Speaker 1: one app that's like triple the points if you use
Speaker 1: a USD versus USDC. So they're all coming up with
Speaker 1: their own creative ways, uh to drive AUSD adoption and
Speaker 1: so ultimately that should trickle down to I would say,
Speaker 1: you know, the non institutional or enterprise market, but you know,
Speaker 1: I view healthy markets need to be a combination of
Speaker 1: both those categories.
Speaker 2: Yeah. Absolutely, And to your point, like going to some
Speaker 2: of these enterprises which have retail using their services would
Speaker 2: be an easy way for distribution in the sense and
Speaker 2: getting more people to use the app. So if you
Speaker 2: went to I don't know. Well, if you let's say
Speaker 2: ven K, yeah, right, it's an easy distribution through throughout
Speaker 2: their current customer base. And by the way, will ven
Speaker 2: K use a USD.
Speaker 1: Yes, they have their own liquid fund and venture fund
Speaker 1: which I imagine will be using it in some capacity.
Speaker 2: Tell us a bit about what blockchains a U S
Speaker 2: the is currently available on and plan sixpand beyond that.
Speaker 1: Yeah, So we started on Ethereum, mainenet towards the end
Speaker 1: of the summer, launched Avalanche suiy and on Mantle, both
Speaker 1: each a month after the other. Our most active chain
Speaker 1: todate is Avalanche, although we're seeing, you know, the ensuing
Speaker 1: chain is also growing at the same rate in terms
Speaker 1: of volume in a M. In addition to to those networks, uh,
Speaker 1: we already announced that we'll be uninjective, so that I'll
Speaker 1: be coming soon, and then there's a few other large
Speaker 1: networks that we'll be coming to. One that we're particularly
Speaker 1: excited about is coming to Polygon's ag layer. So we
Speaker 1: won that RFP against you know, the the largest players
Speaker 1: in the market today, and so we'll be going to
Speaker 1: that network natively, uh, you know, once once the ag
Speaker 1: layer is up and live, and so that's one that
Speaker 1: we're particularly excited about. And there'll be a few more
Speaker 1: announcements coming over the next next few months, and then
Speaker 1: I think we'll probably slow our deployment schedule, you know,
Speaker 1: starting in Q two of next year.
Speaker 2: And tell us about your reserves. What is what does
Speaker 2: this consist of and how where is it being custody.
Speaker 1: Yeah, so from the get go, it's important to be
Speaker 1: institutional grade and actually have scalability, right, and so one
Speaker 1: of the advantages of you know, being a vanack is
Speaker 1: that they have large asset bases at various banks, right,
Speaker 1: And that's been particularly valuable over the last year given
Speaker 1: Operation Choke point two point zero and the reluctance of
Speaker 1: banks to touch crypto. And so State Street, which is
Speaker 1: one of the largest gesips in the world that's a
Speaker 1: globally systemic bank is managing, is the cash custodian and
Speaker 1: the fund admin of the Agora Reserve Fund that is
Speaker 1: in a Delaware Reserve Trust, and so the majority of
Speaker 1: the assets sit with State Street. We have a very
Speaker 1: small percentage with what I call settlement banks, so banks
Speaker 1: that interact with our customers directly, and so we use
Speaker 1: a variety of banks there, so that it's very quick
Speaker 1: settlement when people want to redeem, and the assets are
Speaker 1: primarily in overnight reverse repo and then short those assets
Speaker 1: are managed by Vanac, so you have a you know,
Speaker 1: money manager that manages over one hundred million dollars globally regulated,
Speaker 1: been around for seventy plus years managing the assets, not
Speaker 1: just Agora. So they're safe, secure, and you know theoretically
Speaker 1: we could take in hundreds of billions of dollars tomorrow
Speaker 1: given UH stage street size. You know, I don't think
Speaker 1: that's going to happen, but you know, hopefully one day
Speaker 1: it is the case.
Speaker 2: Yeah. Absolutely. How are you guys set up to avoid
Speaker 2: situations like what happened to Circle with I believe with
Speaker 2: silver Gate or I'm not mistaked.
Speaker 1: Yes, silver Gate SVB. Yeah, So it's by relying on
Speaker 1: a very large bank, right, that is adhesive, right, So
Speaker 1: you know, one of the mistakes of you know, one
Speaker 1: of the challenges using regional banks and using uninsured bank
Speaker 1: deposits that are out of a trust structure is that
Speaker 1: they are then not as safe as if they were
Speaker 1: in you know, a multi trillion dollar asset bank UH
Speaker 1: where the assets are in a trust structure, and so
Speaker 1: you know, from a structuring perspective, we wanted to nip
Speaker 1: that issue in the bud from the get go and
Speaker 1: to learn from i would say, others mistakes. And so
Speaker 1: that's a circumstance that will not happen with us, you know,
Speaker 1: unless you know the world is on fire.
Speaker 2: Yeah, but then we have bigger problems. Yeah, yes, correct,
Speaker 2: are you playing to you may have mentioned this earlier,
Speaker 2: but are you planning to offer yield and in both
Speaker 2: on the institutional and the retail sign.
Speaker 1: Yeah. So the way that we think about it is ultimately,
Speaker 1: you can't pay non KYC retail if you're interacting with
Speaker 1: the banking system, right. And so we designed, you know,
Speaker 1: our model around one being compliant, but also to delivering
Speaker 1: value to the people that are driving it, to the
Speaker 1: to the network. And so what we do is we
Speaker 1: KYB the end business and then based on the assets
Speaker 1: within their perimeter, we share the majority of the net income. Right,
Speaker 1: So if there's you know, one hundred million of a
Speaker 1: USD on adapp or an exchange that is KYBT with us,
Speaker 1: we pass the majority of that income through and then
Speaker 1: it's up to that business to choose how to build
Speaker 1: the best products around AUSD, right, So that could be
Speaker 1: by just you know, passing incentives to users. It could
Speaker 1: be by like reducing trading fees or reducing you know,
Speaker 1: the borrow fees, or incentivizing borrows or incentivizing deposits. It's
Speaker 1: totally up to them. But that's ultimately like how we
Speaker 1: are driving value back to the system. And you know,
Speaker 1: if folks want a pure yield product, I think pure
Speaker 1: yield products are are better, right, but ultimately stables and
Speaker 1: yield products are are you quite quite different, And so
Speaker 1: we want to reward the people that are actually helping
Speaker 1: drive utility and equidity to our stable coin network, which
Speaker 1: is very different than you know, if someone wants to
Speaker 1: ten percent on a private credit fund and just sort
Speaker 1: of sit there for six months.
Speaker 2: Yeah, that definitely makes sense. Now you mentioned KYC, and
Speaker 2: we know sable coin legislation is being worked on here
Speaker 2: in the US and will most likely include a lot
Speaker 2: of that. KYC a m L. In the EU, they
Speaker 2: passed the MICA regulation which seemed to disrupt Teather's business,
Speaker 2: and I believe it's more related to KYC. So talk
Speaker 2: to us about the importance of that and how these
Speaker 2: regulators are going to you know, put together the legislation
Speaker 2: for this market.
Speaker 1: Yeah, so I think there's a few things specifically with
Speaker 1: MIKA that Tether didn't agree with. Yeah, some of them,
Speaker 1: I I actually, you know, I agree with them as well.
Speaker 1: You know, requiring x percentage to be in bank deposits,
Speaker 1: which are you know, uninsured. It is probably not safe,
Speaker 1: just based on what's happened with some other issuers, but
Speaker 1: maybe just touching on you know, broad you know, broadly,
Speaker 1: like how I think about this as the banking system.
Speaker 1: If you're a fiatcoin, you interact with the banking system, right,
Speaker 1: and they are very strict around k y C, a
Speaker 1: m L, and like it's core to their business to
Speaker 1: maintain that everyone is compliant and if that's not the case,
Speaker 1: they're going to shut you off, right, And so as
Speaker 1: an issuer, you need to be focused on adhering to
Speaker 1: you know, appropriate regulation that you know, a lot of these
Speaker 1: these large banks are going to have to follow, which
Speaker 1: Tether does to a degree. And you know, and I
Speaker 1: would say they're they're relatively compliant depending on the jurisdiction
Speaker 1: with regards to like k y C and a mL.
Speaker 1: It's just you know, you can't pay non identified wallets
Speaker 1: right directly, that's probably a no no. And so we're
Speaker 1: going to see and you know a lot of these
Speaker 1: bills that are passing with stable coins in particular, say
Speaker 1: you can't pay yield directly to people, right, those are
Speaker 1: specifically yield products. And so that's why you know, from
Speaker 1: our perspective, you should be rewarding the businesses you are
Speaker 1: not altered necessarily the holders, but then it dry they
Speaker 1: can drive value to your product and make it a
Speaker 1: better experience for the users. Right, Whereas like, okay, if
Speaker 1: you are yield product, like you're in an entirely separate
Speaker 1: bugget regardless if it's in the US, the EU, or
Speaker 1: like you know, Singapore, Hong Kong, somewhere else.
Speaker 2: Question for you, and this may be a dumb question
Speaker 2: if I'm thinking about it, right, you as the issuer,
Speaker 2: Let's say you're working with Bank of America or something
Speaker 2: like that, do you want to use a U s D?
Speaker 2: Are you responsible for the KYC or is Bank of
Speaker 2: America responsible for it? Based on who's using it through
Speaker 2: their system?
Speaker 1: Yeah? So uh we KYB anyone that is minting and
Speaker 1: redeeming the asset, right, so anyone that is sending US
Speaker 1: fiat currency or redeeming a USD we do a you know,
Speaker 1: rigorous enhanced dd KYB. But ultimately the stable coin is
Speaker 1: freely transferable, with the exclusion of of course O fact
Speaker 1: sanctioned wallets and some other edge cases. But beyond that, uh,
Speaker 1: it's freely transferable. And we you know, engage with you
Speaker 1: know a lot of the largest monitoring providers to make
Speaker 1: sure that uh, you know, a U s C is
Speaker 1: only in good actors hands, right, And so it's ultimately
Speaker 1: up to US RAN. The banks are our trusting that
Speaker 1: we're doing due diligence on all of our customers and
Speaker 1: have these programs in place. You know, they look at
Speaker 1: our m l K y C policies as well as
Speaker 1: other policies that we have in place.
Speaker 2: And I follow up question to the EU micah, are
Speaker 2: are you guys only in the US market right now
Speaker 2: or are you global or only insert?
Speaker 1: Yeah, we're actually primarily focused on the non US market.
Speaker 1: Uh so Asia, Latin America. To me, that's where stable
Speaker 1: coins are most valuable because you have emerging market, lateent
Speaker 1: dollar demand and cross boarder payments like those. That's why
Speaker 1: stable coins are most valuable today. You know, within the US, UH,
Speaker 1: we all have relatively good banking services and payment services,
Speaker 1: and so if you're being intellectually honest, I think the
Speaker 1: value of stable coin is ten x more or even
Speaker 1: one hundred next more valuable outside the United States, right
Speaker 1: in countries where you may not have a strong rule
Speaker 1: of law or good financial service institutions, or you know,
Speaker 1: the financial services institutions may be very costly just to
Speaker 1: even have an account. Right in many countries, double digit
Speaker 1: percentages of the population are unbanked, right because they're just
Speaker 1: like not good enough, and so like this is where
Speaker 1: technology can come in and solve those problems and give
Speaker 1: everyone access to secure financial services right through defive and
Speaker 1: so those are the markets that we're really focused on.
Speaker 2: Do you foresee that these money transfer companies like your
Speaker 2: Western Unions and money gram and so forth, are going
Speaker 2: to use stable coins like a US or may they
Speaker 2: try to launch their own although we've seen some of them.
Speaker 2: I think they attempt to do, but it hasn't worked
Speaker 2: that well. I think of JP Morgan jpm coin, because
Speaker 2: it's not on a public blockchain, it's not free to move.
Speaker 2: What are your thoughts on the future of these.
Speaker 1: Companies, Yeah, I think a few will launch stable coins. Ultimately,
Speaker 1: I think that's not a business that they should be in. Like,
Speaker 1: I think they should just like leverage someone like US,
Speaker 1: where you know, they're making the majority of the underlying
Speaker 1: net income that's on their platform and they don't have
Speaker 1: to worry about compliance, building the network, liquidity management, like
Speaker 1: we handle all that for you, right, and so just
Speaker 1: focus on the end relationship with your current customer base
Speaker 1: and providing like a better service. And so if it's
Speaker 1: you know, the income from the stable that folks want, like,
Speaker 1: we're happy to provide that, and then you participate in
Speaker 1: this broader liquidity network, right. Building a stable point network
Speaker 1: is extremely hard. That's why I think you've seen many
Speaker 1: people start to do it and then abandon it because
Speaker 1: unless it's your core business, it's probably not something that
Speaker 1: you should be doing, right. I think other service providers
Speaker 1: like can come in and sort of cut the cut
Speaker 1: the margins out from under USCC and tether and hopefully
Speaker 1: make this a much more egalitarian monetary system m HM.
Speaker 2: And in regardless to like wallet support, tell us a
Speaker 2: bit about that. Are you currently partner with any major wallets?
Speaker 2: And things like that.
Speaker 1: Yeah, so you know, most of the wallets can import
Speaker 1: us if they want or you know, Consensus actually is
Speaker 1: an investor in US, so meta mask, you know, any
Speaker 1: of the major wallets, as long as you import our
Speaker 1: ARC twenty token, it's it's available. And so we're planning
Speaker 1: to launch a few campaigns and we've been working closely
Speaker 1: with the ok x wallet team as well as a
Speaker 1: number of the centralized exchange wallet teams. Most of them
Speaker 1: have built really fantastic products in addition to you know,
Speaker 1: standalone wallet companies.
Speaker 2: I used to work for okay x, so if you
Speaker 2: need any help there, help me know.
Speaker 1: Yeah. Now they're great and like the wallet is is
Speaker 1: like top tier for sure, particularly like they're stable coin page,
Speaker 1: which like sort of just shows you like a menu
Speaker 1: of opportunities like okay, you want to you know, make
Speaker 1: twenty percent on AUSD or U s D C U
Speaker 1: s C T like hear all the different lending protocols
Speaker 1: or a m MS. It's it's really well done.
Speaker 2: As much as you can tell us what are some
Speaker 2: of these strategies and tactics you have for growth and
Speaker 2: what's kind of I don't once you give away your
Speaker 2: secret sauce, but you know what, what's on your roadmap.
Speaker 1: Yeah. So one of the things that I believe is
Speaker 1: as the issuer, you should, uh, you have the right
Speaker 1: to do everything downstream from you cheaper, right, uh, particularly
Speaker 1: on the on and off ramp side, the infrastructure side,
Speaker 1: and then eventually some things in the in the app
Speaker 1: player as well. Right. I think that's one of the
Speaker 1: things to me that has been interesting is you know,
Speaker 1: USDC abandoned their API product. I think that's an area
Speaker 1: where you can see is leaning in at some point
Speaker 1: in the future. Something that I'm also focused on is
Speaker 1: like what is like the next what are the next
Speaker 1: one hundred x markets stables and so you know, I
Speaker 1: don't want to get too deep into that, but I
Speaker 1: can tell you we're not trying to compete for BTC
Speaker 1: price discovery on finance against tether. I think that's a
Speaker 1: losing battle, and so we're focused on other things. But
Speaker 1: I think crypto trading is sort of V one of
Speaker 1: stables and V two and three are going to be
Speaker 1: much bigger than the status quo today, which is like
Speaker 1: you know, it's mostly crypto trading. So we're going to
Speaker 1: be focused on a lot of those those use cases.
Speaker 2: Anything on micro payments or is it too early for
Speaker 2: you guys, you know where people can do micro transactions
Speaker 2: or creators can get streaming revenue and AUSD and things
Speaker 2: like that.
Speaker 1: Yeah, we're working with a few of the Social five companies,
Speaker 1: a lot of number of gaming companies, and so that
Speaker 1: you'll just start to see AUSD just popping up more
Speaker 1: in your favorite ecosystems and apps, because it's ultimately better
Speaker 1: for those businesses, right because they actually get to capture
Speaker 1: a lot of the economic value. And so on the
Speaker 1: micro payment side, you know, there's not much that we're
Speaker 1: doing there yet, but you will see a lot more
Speaker 1: announcements with us and different payment providers early next year
Speaker 1: where we'll get much more deeply embedded within in the
Speaker 1: payment ecosystem.
Speaker 2: Talk to us a bit a bit about your vision
Speaker 2: for payments or how you see the payments market evolving
Speaker 2: with the mixture of stable coins and crypto assets. You know,
Speaker 2: are we gonna see the elimination of the western unions
Speaker 2: and the money grams because I can just do peer
Speaker 2: to peer payments and I could use the stable coins
Speaker 2: settles instantly very low fees. I could do a twenty
Speaker 2: four to seven, no delays and things like that.
Speaker 1: Yeah, I think you won't see the end of Western Union,
Speaker 1: but you'll see their margins collapse, and I think you'll
Speaker 1: see their market share collapse. Right if you have a relative,
Speaker 1: you know, whether it's in Singapore or Australia or Argentina
Speaker 1: or Germany. Right, it's just stables are not just ten
Speaker 1: x better, like one hundred x better. Right, you know
Speaker 1: there's the still I would say hard piece. It's not
Speaker 1: that hard, but it needs to be figured out. Is
Speaker 1: the on and off ramps right? And does the stable
Speaker 1: that you're sending have good on and off ramps? Right?
Speaker 1: You know, which is on the infrastructure side, and obviously
Speaker 1: something that will be focused on. So I think stable
Speaker 1: pains will really start to eat into the cross border
Speaker 1: just dollar markets and the P two P remittance markets,
Speaker 1: which I think they've already done pretty pretty good job
Speaker 1: of making a dent into. And then I think in
Speaker 1: terms of cross border things, FX is next. Right, So
Speaker 1: today a lot of people are doing one leg of
Speaker 1: the trade in stables and the other is like still
Speaker 1: in fiat. I think you'll start to see the growth
Speaker 1: of a number of non US dollar stables over the
Speaker 1: next five to ten years, which hasn't really occurred yet.
Speaker 1: I think the ultimately the market size there is limit
Speaker 1: because you know, the US is just the dominant currency
Speaker 1: for global trade, it's the global reserve asset. But also
Speaker 1: people that aren't even Americans want to hold dollars. This
Speaker 1: isn't really the case for other currencies. Like You've had
Speaker 1: all these euro stables that have been around for years now,
Speaker 1: and I think they're not really going to take off
Speaker 1: other than for FX reasons and like basic balance reasons
Speaker 1: because just like no one outside like you know, as
Speaker 1: an American, I'm never I'm not holding a europe right,
Speaker 1: whereas that's not that's not you know, their ship call
Speaker 1: is not true.
Speaker 2: Yeah. Absolutely, And the US of course has the advantage
Speaker 2: of having the world reserve currency, so everybody wants the
Speaker 2: dollars and until there's some major geopolitical shift, that's going
Speaker 2: to be the case, and stable coins, the US back
Speaker 2: stable coins makes sense. What are your thoughts on the
Speaker 2: dialogue that's happening in Washington, d C. Of helping to
Speaker 2: preserve the world reserve currency status by having the US
Speaker 2: the backstable coins, and that the US government needs to
Speaker 2: move forward and getting proper legislation and clarity so companies
Speaker 2: like yourself can feel free to build.
Speaker 1: Yeah, I think, you know, the announcements over the last
Speaker 1: few weeks have been really positive for development within the
Speaker 1: United States. I think it's very clear now that US
Speaker 1: dollar stables are like the best economic and almost defense
Speaker 1: tech weapon that the US government hasn't created or a
Speaker 1: defense company hasn't created, because you know, what we're doing
Speaker 1: every single day is going and you know, trying to
Speaker 1: grow the dollars usage outside the US right. Ultimately, that
Speaker 1: reduces the cost of the federal debt and expands American
Speaker 1: soft power globally, which is great. I think, you know,
Speaker 1: people from both sides of the aisle recognize that, and
Speaker 1: I think particularly with some of the appointments, you know,
Speaker 1: although they're pending over the next few weeks and some
Speaker 1: of the rights of resignations, things you know, within the
Speaker 1: States are looking much more receptive to crypto and so
Speaker 1: it's Yeah, I think things seem to be moving nicely,
Speaker 1: which is great.
Speaker 2: What are your thoughts about cbdc's and the mixture of
Speaker 2: this with stable coins in the open market now, we
Speaker 2: haven't really seen any major CBDCs. There is talks of
Speaker 2: China has a digital you want. I haven't seen it.
Speaker 2: I have never seen anybody use it. But you know,
Speaker 2: there's a talk of wholesale versus retail. So do you
Speaker 2: think the CBDCs are going to be running behind the
Speaker 2: scenes with the federal government so to speak? And I
Speaker 2: hope not, right, but use retail is going to be
Speaker 2: using the stable coins, Like I'm not a fan of
Speaker 2: CBDCs either. I would rather the free market stable coins, right,
Speaker 2: But it seems some governments are working on these things.
Speaker 1: Yeah, I you know, each country is different. I don't
Speaker 1: think they'll ever be well received in the United States
Speaker 1: because I think think it's a dangerous tool for anyone
Speaker 1: to have. Right is Okay, I can basically delete the
Speaker 1: money from your bank account if you say political speech
Speaker 1: I don't agree with, right, And I think in the
Speaker 1: United States over the last couple of months, there's been
Speaker 1: a lot of concern right around censorship, right, you know,
Speaker 1: And and it's sort of us living in like this
Speaker 1: crypto Twitter bubble, right, you know, I think we're most
Speaker 1: folks are aware of that, right and sort of you know,
Speaker 1: I came at bitcoin originally because I'm relatively like libertarian
Speaker 1: and believe that ultimately like federal debt is is bad
Speaker 1: and federal government power is scary if you know, if
Speaker 1: used improperly, which almost always inevitably ends up being the case. Uh,
Speaker 1: And so CBBC's I think are a scary weapon and
Speaker 1: hope never introduced in America, but you know, much less
Speaker 1: any other country in the world. But I think other
Speaker 1: nations are maybe going to be less lucky than us.
Speaker 1: I don't know.
Speaker 2: Yeah, No, it's a great point, and it's it's a
Speaker 2: lot of it's TBD but we know they say, like
Speaker 2: China seems to have one in the wild somewhere that
Speaker 2: they're testing, and thankfully here at least, you know, within
Speaker 2: our walls, so to speak. It seems like the country's
Speaker 2: movement in direction no cbdc's, but more free market.
Speaker 1: Yeah. I just like don't think the American people like
Speaker 1: would like tolerate that, like it would just be like
Speaker 1: a little bit crazy. It'd also like kind of blow
Speaker 1: up the existing banking system. So I think, fortunately it's
Speaker 1: it's not something that's going to happen here.
Speaker 2: So on that note, when we think about currency, right
Speaker 2: and the movement of money and how the Federal Reserve
Speaker 2: and the Treasury track all these things and they look,
Speaker 2: they have levers they pull to inject liquidity, move the
Speaker 2: velocity or increase the velocity of money and things like that.
Speaker 2: Will stable count legislation? Do you think mandate that the
Speaker 2: that you have to connect to the Treasury in some
Speaker 2: way via API and they need to track all the
Speaker 2: issuance and everything like that. Do you think things like
Speaker 2: may go that direction.
Speaker 1: I would be surprised if the legislation is that technology
Speaker 1: technologically forward where you have to connect it with API.
Speaker 1: I think we'll just have to see. I'm I'm not
Speaker 1: really one that likes to speculated on legislation, just because
Speaker 1: I have seen how slow moving things can be in
Speaker 1: the United States. I mean, look, it took seven years
Speaker 1: from Vanak, which was, you know, a top ten global
Speaker 1: ETF issho were to file for a Spot product ETF
Speaker 1: for it to go live like very vanilla products. You know,
Speaker 1: there's like three x inverse lever and oil services ETFs.
Speaker 1: But you know Spotpiquini ETF was verboten. So I'm out
Speaker 1: of like the legislative guessing game these days, and I
Speaker 1: just react to what happens.
Speaker 2: Yeah, for sure. You know, on that note of big quo,
Speaker 2: are you blown away by the growth of this asset.
Speaker 2: It is now in the political realm, It's now in
Speaker 2: the tradfire realm. Obviously with et apps. Countries are buying it.
Speaker 2: There's a Bitcoin Strategic Reserve bill on the table. States
Speaker 2: are also looking to do the same thing as the
Speaker 2: federal government. What are your thoughts on the growth.
Speaker 1: I'm not surprised, Like this is my thesis since twenty sixteen,
Speaker 1: is that it's going to subsume the gold market because
Speaker 1: it's a much better product. You know, as someone that
Speaker 1: grew up in online right, So I'm not surprised. I
Speaker 1: will say it happened a little bit quicker than I
Speaker 1: expected to be honest, I didn't really think and I
Speaker 1: really never The one thing I am surprised about is
Speaker 1: it becoming more of a political issue within the United States.
Speaker 1: It never should have been. Yeah, and I think a
Speaker 1: lot of that was in part because you had Sam
Speaker 1: Bankman free donate so publicly to political organizations and that
Speaker 1: that then had knock on effects. So I am a
Speaker 1: little bit surprised by that. But of the growth of
Speaker 1: the asset I'm not. I think, you know, this was
Speaker 1: almost inevitable. You know, once the debt printing train gets
Speaker 1: you know, going on the tracks, it's really hard to
Speaker 1: stop it. And you know, bitcoin is is in some
Speaker 1: ways an antidote to that.
Speaker 2: So what is your outlook for the market in twenty
Speaker 2: twenty five? Do you see continued growth, you know, kind
Speaker 2: of following to four year cycle?
Speaker 1: I think so, you know, I think we're obviously in
Speaker 1: a period of elevated enthusiasm given the change in attitudes
Speaker 1: you know, within the federal government that are probably coming
Speaker 1: within the United States, and US is the largest global economy,
Speaker 1: so that's a big deal. I also think a lot
Speaker 1: of G seven countries look at the US financial services
Speaker 1: in for sort of like guidance on you know, what
Speaker 1: to do next. So I think we'll have continued growth
Speaker 1: within twenty two, you know, throughout twenty twenty five, you know.
Speaker 1: I I sort of view like US as in being
Speaker 1: like inning number one of like real crypto, which is
Speaker 1: like non speculative assets, and like Inning number six or
Speaker 1: seven of speculative crypto. And so I think speculative crypto
Speaker 1: will be a little bit more short lived next year,
Speaker 1: whereas I would say, like real crypto, So just the
Speaker 1: adoption of blockchain technology, stable coins, tokenized assets will kind
Speaker 1: of continue to compound at a very steady rate. And
Speaker 1: I think that's gonna be true for the next twenty years, right,
Speaker 1: And so I think that part of the industry is
Speaker 1: going to be way less cyclical than the speculative aspect.
Speaker 1: And so, you know, we were expecting it to be
Speaker 1: a great year. You know, maybe things are accelerated a
Speaker 1: little bit by what's gone on in Washington, but you
Speaker 1: know where we sit and sort of the stable coins,
Speaker 1: institutional capital world and stitutional products, and that is going
Speaker 1: to be growing in a really high compound rate for
Speaker 1: the next twenty years. Now.
Speaker 2: You mentioned tokenization, and we're seeing some of the largest
Speaker 2: firms on Wallstreet, black Rock, and so forth, they are
Speaker 2: starting to tokenize. You are doing a form of tokenization
Speaker 2: with stable coins, Are you planning to or are you
Speaker 2: thinking about other forms of tokenization that Agora may want
Speaker 2: to get involved with, whether it's tokenized goal, tokenize real
Speaker 2: estate and things like that.
Speaker 1: Yeah, not at the moment. Ultimately, we just want to
Speaker 1: be the op stable between all these different assets, right,
Speaker 1: and so we're working We'll plan and work with a
Speaker 1: number of different asset management companies r WA providers like
Speaker 1: we just want to be that neutral glue that stitches
Speaker 1: everything together. We don't want to launch competing products. We're
Speaker 1: probably not going to ever launch a non US dollar stable,
Speaker 1: certainly not on the roadmap now, but I guess never
Speaker 1: say never, or any sort of other tokenized product. We
Speaker 1: ultimately just want to work with with other issuers of
Speaker 1: those types of assets and help make their products better.
Speaker 2: Mm hm. You know you mentioned something earlier about you
Speaker 2: in twenty sixteen, you saw bitcoins rise in a digital world.
Speaker 2: You're on the younger side. I think you're probably younger
Speaker 2: than me. We got gen z Jen Alpha and all
Speaker 2: these folks right that are coming up and they live
Speaker 2: in a digital world and they don't necessarily care about
Speaker 2: golden stocks, but they like crypto. They're like meme coins.
Speaker 2: You know, I'd love to get your take on that.
Speaker 2: And it seems that you know, they're going to gravitate
Speaker 2: to label coins and gravitate to bitcoin and crypto and
Speaker 2: things in the digital rem versus you know, the older generation.
Speaker 2: What are your thoughts on that change?
Speaker 1: Yeah, you're thankfully I'm a millennial, but your gen z, yeah,
Speaker 1: I think they.
Speaker 2: Yeah.
Speaker 1: One of the things that's going to influence their behavior,
Speaker 1: I think more so than my generation or older generations,
Speaker 1: is that they live in like a social finance world, right.
Speaker 1: Like something that I didn't really ever think about when
Speaker 1: like first getting into bitcoin like eight plus years ago
Speaker 1: now was how much of a role communication technology you'll
Speaker 1: play on and on sort of investing or asset prices.
Speaker 1: You sort of saw this with almost like the sevb
Speaker 1: Uh bank run, right, is like that was propagated on
Speaker 1: Twitter and then everyone withdrew their money and then the
Speaker 1: bank imploded. Right, you know, people say, oh, look this
Speaker 1: meme coin's going up, and people just pile in, you know,
Speaker 1: almost instantaneously. Like that I think is very different from
Speaker 1: ten years ago, twenty years ago, when it's like okay,
Speaker 1: you know, put money you know in uh the S
Speaker 1: and P five hundred and just sit on it. You know,
Speaker 1: you know it's probably gonna compound at six seven percent
Speaker 1: a year. It's safe. Secure. Like there's like sort of
Speaker 1: this social element now that's been introduced to asset prices,
Speaker 1: whether it's crypto or other things that I think is
Speaker 1: actually what's like driving maybe a behavioral change that I
Speaker 1: don't necessarily know if it's good or bad, Like is
Speaker 1: it you know, if people are spending like their savings
Speaker 1: on things that can lose their value in an hour,
Speaker 1: like the entirety of their value in an hour, Like
Speaker 1: that's just gambling and that's probably not good. But if
Speaker 1: people are, you know, moving money from like entertainment, right, like, oh,
Speaker 1: you know I was gonna spend thirty bucks on a
Speaker 1: movie tonight. You know, well, maybe I'll just trade mean
Speaker 1: coins instead, Like that's probably more innocuous. So I don't
Speaker 1: you know, I don't anticipate people's behavior is changing. I
Speaker 1: think some of it's uh, definitely not good behavior, and
Speaker 1: there needs to be some moderation in terms of content
Speaker 1: and what people are able to do. But you know,
Speaker 1: you just kind of have to adapt, right. It's like
Speaker 1: when the internet got going, I think it was hard
Speaker 1: to foresee all the things that it would change, and
Speaker 1: you know, they sort of twenty four to seven terminally
Speaker 1: online ability to communicate with large groups of people is
Speaker 1: also changing how people invest, spend their money, spend their
Speaker 1: time too, right, So you know, I think a lot
Speaker 1: of the younger generation will continue to invest time and
Speaker 1: energy and crypto, but I think hopefully they you know,
Speaker 1: spend time on fixed income and equity products as well.
Speaker 2: Yeah, for sure. You know, as we were talking about
Speaker 2: some of the behavior things, I was thinking about the
Speaker 2: pump dot fund and madness that's happening. I don't know
Speaker 2: if you've said, like that stuff is scary, it's crazy.
Speaker 1: Let's mark the day today is November twenty fifth. Like,
Speaker 1: the stuff that's going on on with pumped out fund
Speaker 1: right now is like a little bit too much that
Speaker 1: probably needs like well, it certainly content moderation, like absolutely,
Speaker 1: that is like the stuff that is not not acceptable.
Speaker 2: But the idea though, the infrastructure and the concept, right,
Speaker 2: that could be applied in many great ways. For example, you,
Speaker 2: as an entrepreneur a company, right, if done in the
Speaker 2: proper format and the proper regulations are in place, I
Speaker 2: can bet on you. I can bet an Agora from
Speaker 2: day one. You know, if Elon was to tokenize himself,
Speaker 2: would I invest in him? Hell yeah, because the guy's
Speaker 2: incredible And I don't agree with everything, but he's incredible
Speaker 2: as an entrepreneur. Same thing, Tom Brady, if he was
Speaker 2: still playing tokeniz, Yeah, would I invest in dog number
Speaker 2: five mein Cointa just started last night. No, but the
Speaker 2: idea is it just depends on what it is as
Speaker 2: being tokenized.
Speaker 1: Yeah. I think some of it, if it was done properly,
Speaker 1: could be worthwhile. Though you know, I don't know if
Speaker 1: I want everything to be financialized right, like hyper financialization
Speaker 1: is probably not a great thing for society.
Speaker 2: Mm. Yeah. But the part of the problem is until
Speaker 2: they fixes, people are dealing with financial hardship, inflation and
Speaker 2: so forth. I think macro investor Ralph Paller I heard
Speaker 2: him say about it, this is kind of an avenue
Speaker 2: ac oh, I can bet on this and make a
Speaker 2: bunch of money. Why not. I got nothing to lose.
Speaker 2: I'm not getting the same returns and other things. So
Speaker 2: once again that what they're betting on could be wrong.
Speaker 2: But I think that the root of all this is
Speaker 2: people are trying to find a way out, and that
Speaker 2: goes back to the debasement of currency, the money printing
Speaker 2: and all these things that's happening.
Speaker 1: Yeah. Yeah, I think some of the better things to
Speaker 1: do is probably just use stables in like ave or
Speaker 1: morpho or something to protect yourself against that. But yes,
Speaker 1: you know, I think some of this has been valuable
Speaker 1: to folks for sure.
Speaker 2: All Right, Nick, got some wrap up questions here for you. First,
Speaker 2: if you create your own averse, what would theme be?
Speaker 1: I al cream my own metaverse.
Speaker 2: Where'd you put your Oculus or Apple?
Speaker 1: Yeah? Yeah, I think probably going back into classical Greece.
Speaker 1: And it's not just because I saw a Gladiator, which
Speaker 1: I knows, you know, based on the Roman Empire this
Speaker 1: weekend Gladiator too, But I studied classical history and major
Speaker 1: did it in college. I've just been always fascinated by it.
Speaker 1: And yeah, I think like being able to like time
Speaker 1: travel back into that era. It would be really really interesting.
Speaker 1: There's a lot of other different time periods I would
Speaker 1: like to go back to as well, to be like
Speaker 1: a fly on the wall, But that's probably number one.
Speaker 2: Yeah, I would love that too. I'm being on history,
Speaker 2: so being able to go back to Rome or ancient Greece,
Speaker 2: whatever it is, it would be amazing. Rapid fire questions.
Speaker 1: Favorite food, favorite food sushi.
Speaker 2: Favorite musician or band.
Speaker 1: Ciesto, favorite movie movie. Ah, this is a tough one. Yeah,
Speaker 1: I'll say Gladiator the first one. That may just because
Speaker 1: I saw Gladiator too this weekend.
Speaker 2: But the first one's great, Like I watch it all
Speaker 2: the time. My wife like, if it's on TV, my
Speaker 2: mind's like my wife is like, haven't you seen this
Speaker 2: a million times?
Speaker 1: Like it's really good. Favorite book, favorite book. My favorite
Speaker 1: fiction book is Aragon, So I love that series. When
Speaker 1: I was growing up, that was like incredible. And I
Speaker 1: think they're I heard they're redoing the show. The movie
Speaker 1: was not great, but I hear they're redoing the show,
Speaker 1: and so I have high hopes that'll be much better
Speaker 1: than the movie.
Speaker 2: And when you're not working at Ogoria, what are you
Speaker 2: doing for fun?
Speaker 1: Probably just spending time with family and friends.
Speaker 2: Mm hmm, Nick, absolute pleasure. I love what you guys
Speaker 2: are doing with a USD, and I would love to
Speaker 2: have you back on as things progress. But thank you
Speaker 2: so much for joining me.
Speaker 1: Yeah, thanks, Tony
Speaker 2: Bask b stok, psk pst pskot