Latest / Leaders In Payments / Stablecoins For Enterprise Payments with Tony Tom, CRO and Co-Founder of Stable Sea | Episode 484

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Stablecoins For Enterprise Payments with Tony Tom, CRO and Co-Founder of Stable Sea | Episode 484 · Leaders In Payments

• 0:00
  SPEAKER_00: Welcome to the Leaders in Payments Podcast, where we talk to sea level leaders from across the payments landscape.
• 0:07
  SPEAKER_00: We'll be discussing the products and services that impact the payment space today, as well as trends and predictions for the future of payments.
• 0:14
  SPEAKER_00: We will also hear stories from our guests about their journeys to the top.
• 0:18
  SPEAKER_02: Hello, everyone, and welcome to the Leaders in Payments Podcast.
• 0:20
  SPEAKER_02: I'm your host, Greg Myers, and today's special guest is Tony Tom, the CRO and co-founder of Stable C.
• 0:27
  SPEAKER_02: So, Tony, thank you so much for being here today and welcome to the show.
• 0:30
  SPEAKER_01: Thanks, Greg.
• 0:30
  SPEAKER_01: Really excited to talk with you and thanks for having me.
• 0:33
  SPEAKER_02: Absolutely.
• 0:33
  SPEAKER_02: So before we dive into your career and the company, can you give us a quick snapshot of your personal background, maybe where you grew up, where you call home today, a few things like that?
• 0:41
  SPEAKER_01: Absolutely.
• 0:42
  SPEAKER_01: So I'm a Pacific Northwest guy.
• 0:44
  SPEAKER_01: So grew up in Seattle.
• 0:45
  SPEAKER_01: Wife was from Portland, ended up there for 20 years, started my career in the Portland fintech scene, which if you're not from Portland, you're probably like Portland has a fintech scene.
• 0:54
  SPEAKER_01: But there is some truth to that.
• 0:55
  SPEAKER_01: Later in my career, I actually took a job with Block, which is obviously part of the story for what I'm doing now.
• 1:02
  SPEAKER_01: But the theme has always been payments.
• 1:04
  SPEAKER_01: I moved to San Francisco, though, circa 2019, just in time for the world to shut down for COVID and for our lives to be turned upside down just a little bit.
• 1:12
  SPEAKER_01: But personal life looks like I'm the father of three boys.
• 1:15
  SPEAKER_01: We play a lot of volleyball around here.
• 1:17
  SPEAKER_01: One of my sons plays Division I, which we're super excited about.
• 1:20
  SPEAKER_01: I coach at the local high school.
• 1:22
  SPEAKER_01: So I'm part-time dad, part-time coach, part-time startup founder, payments executive guy.
• 1:28
  SPEAKER_01: So that's, I guess, the many hats that I wear in me in a nutshell.
• 1:31
  SPEAKER_02: Awesome.
• 1:32
  SPEAKER_02: Well, I have three girls, so I know nothing about raising boys.
• 1:36
  SPEAKER_02: But if you ever want to know about raising girls, I can tell you all about it.
• 1:39
  SPEAKER_01: I appreciate that.
• 1:40
  SPEAKER_01: Yes.
• 1:41
  SPEAKER_01: Yeah, we can we can swap those because I'm sure there are distinct differences.
• 1:45
  SPEAKER_02: Yeah, absolutely.
• 1:46
  SPEAKER_02: All right.
• 1:46
  SPEAKER_02: So you started a little bit.
• 1:48
  SPEAKER_02: Let's let's talk about your professional journey and maybe even if you don't mind getting into why you started Stable C.
• 1:53
  SPEAKER_01: Yeah, professional journey is interesting.
• 1:55
  SPEAKER_01: So I set out to be a teacher, actually.
• 1:57
  SPEAKER_01: Teacher coach was like my original vision early in my career.
• 2:00
  SPEAKER_01: But then a mentor in my life said, you know, you should really get into business development.
• 2:04
  SPEAKER_01: And I was like, I don't know that I want to teach.
• 2:05
  SPEAKER_01: He was like, Yeah, I never thought you were going to actually finish that whole deal.
• 2:08
  SPEAKER_01: And I was like, okay, cool.
• 2:09
  SPEAKER_01: So he introduced me to a guy who's still in my life.
• 2:13
  SPEAKER_01: He said, Hey, come on and basically cut your teeth selling gift cards for Hollywood video back in the day.
• 2:18
  SPEAKER_01: So first job out of school was selling stored value products randomly.
• 2:23
  SPEAKER_01: But that didn't last very long.
• 2:25
  SPEAKER_01: And I actually went with that boss to a startup in Portland, which was founded by a couple of first data executives called Chockstone, which was the first attempt of, let's call it payment gateway and a digital rewards program.
• 2:37
  SPEAKER_01: And we had this big contract with Subway.
• 2:40
  SPEAKER_01: And I ended up being the senior account executive eventually over the course of a couple of years that was basically running Subway's payment gateway with them and their team and the team that we had founded in Portland.
• 2:52
  SPEAKER_01: And that was my introduction into payments.
• 2:54
  SPEAKER_01: And then everything that has happened since then has been connected to somebody I know, some, you know, something that I learned along the way.
• 3:01
  SPEAKER_01: So there's been mobile app development, there's been Bluetooth low energy technology.
• 3:06
  SPEAKER_01: Ultimately, though, took a lot of different executive jobs eventually, right?
• 3:10
  SPEAKER_01: And was always in business development, partnership development, those types of activities with payments in the background.
• 3:15
  SPEAKER_01: And this really cool opportunity to join Block popped up on my radar via somebody that was in my network and they said, Hey, there's this thing called Cash App, which I think you need to pay attention to.
• 3:25
  SPEAKER_01: And I'd been working for a company that had been acquired by Mercedes Benz and was traveling back and forth to Europe a bunch doing mobile payments and kind of some things in public transportation.
• 3:35
  SPEAKER_01: And I said, What do I got to do?
• 3:36
  SPEAKER_01: And I was like, Cash App.
• 3:37
  SPEAKER_01: And they're like, Yeah, and Bitcoin.
• 3:39
  SPEAKER_01: And I was like, Well, what's Bitcoin?
• 3:40
  SPEAKER_01: This is like, well, I kind of knew what Bitcoin was in 2018, but there was things that I was like, well, maybe.
• 3:46
  SPEAKER_01: And they were like, no, no, no, just come down for an interview.
• 3:48
  SPEAKER_01: And ultimately that that brought me to San Francisco and put me on the journey that I'm on today, which is very, you know, kind of crypto focused, blockchain focused, all with payments and kind of exploration at the heart of it.
• 3:59
  SPEAKER_01: So super grateful.
• 4:00
  SPEAKER_01: But I mean, the the theme of my career has been treat people as kindly and as thoughtfully as you can.
• 4:05
  SPEAKER_01: You never know where they're gonna go, where you're gonna go.
• 4:08
  SPEAKER_01: And you know, I think that ultimately at the end of the day, people's what it's all about.
• 4:13
  SPEAKER_01: So yeah, really, really appreciate it for those who have you know helped me along the way.
• 4:17
  SPEAKER_01: And hopefully I'm leaving a hand behind and pulling people forward as well at the same time.
• 4:22
  SPEAKER_02: Okay, great.
• 4:23
  SPEAKER_02: Well, thanks for sharing that.
• 4:24
  SPEAKER_02: So if you don't mind, let's talk about the company.
• 4:26
  SPEAKER_02: Tell our audience what stable C does.
• 4:28
  SPEAKER_01: Yeah, Stable C is super simple.
• 4:30
  SPEAKER_01: Actually, not simple at all.
• 4:31
  SPEAKER_01: Kidding.
• 4:31
  SPEAKER_01: We do cross-border payments with stable coins and we do treasury management for companies that hold stable coins.
• 4:38
  SPEAKER_01: So the genesis and story of Stable C started at Block.
• 4:42
  SPEAKER_01: After my stint with Cash App Global Operations, which was my first job there, I joined a startup internally inside a block called TBD, which was kind of a tongue-in-cheek joke between Jack Dorsey and the CEO, a guy named Mike Brock.
• 4:55
  SPEAKER_01: And essentially what TBD was focused on was open source protocols for identity and for payments.
• 5:01
  SPEAKER_01: Circa 2022, there was this background question, I think, in a lot of people's mind, which was what is money going to look like?
• 5:07
  SPEAKER_01: How are things going to move?
• 5:09
  SPEAKER_01: Are blockchains really going to be as disruptive as we think that they're going to be?
• 5:13
  SPEAKER_01: And at block, it was how can we leverage Bitcoin in terms of blockchain and in terms of payments to push that future forward?
• 5:20
  SPEAKER_01: And there were a bunch of missing pieces on the table, mostly around identity, but also around network effects for how could other companies practically use either Bitcoin or some digital currency to share value amongst themselves.
• 5:32
  SPEAKER_01: This was probably going to happen outside of a network at the time.
• 5:35
  SPEAKER_01: So not Visa MasterCard, not bank driven, not debit, you know, rail driven, none of that kind of stuff.
• 5:40
  SPEAKER_01: It was more, okay, well, what is it going to be?
• 5:43
  SPEAKER_01: And how could a fintech like Block work with like another fintech like a PayPal more directly, or like a Venmo, or like an international company?
• 5:50
  SPEAKER_01: We had investments in Africa and all these places.
• 5:52
  SPEAKER_01: And I was traveling around all over the place and I ran into this idea like, oh, stable coins is like actually a massive thing outside of our US market.
• 6:01
  SPEAKER_01: And it wasn't Bitcoin.
• 6:02
  SPEAKER_01: It wasn't Bitcoin that people were talking about in Africa.
• 6:05
  SPEAKER_01: It wasn't Bitcoin in Argentina and Brazil.
• 6:08
  SPEAKER_01: It was stable coins.
• 6:09
  SPEAKER_01: And it was ultimately this idea that the US dollar is so much stronger than 99% of the other currencies in the world.
• 6:17
  SPEAKER_01: And access to US dollar was driving a bunch of super interesting behavior in payments outside of the US.
• 6:23
  SPEAKER_01: This was like reconciliation driven.
• 6:25
  SPEAKER_01: It was settlement, you know, cross-border.
• 6:28
  SPEAKER_01: So those questions started to pile up.
• 6:29
  SPEAKER_01: And Stable C was founded originally kind of inside of Block when we were trying to build for that scenario.
• 6:35
  SPEAKER_01: We said, hey, there's no liquidity, there's no market maker, like these cross-border payments are way too expensive.
• 6:40
  SPEAKER_01: And so we left Block and said, cool, let's found our own payments company.
• 6:44
  SPEAKER_01: And we'd all kind of had practice doing that.
• 6:46
  SPEAKER_01: There's three of us as co-founders, a founding marketer, a founding engineer.
• 6:49
  SPEAKER_01: And so the five of us set out on this journey, which has been incredibly fun.
• 6:52
  SPEAKER_01: But we've grown that original idea for solving liquidity for cross-border payments for stable coins into, okay, now let's suck up fiat, turn it into stable coins, and let's use basically solve for trapped cash around the world.
• 7:05
  SPEAKER_01: Because big corporates, they have this issue with having revenue and capital stuck in developing markets.
• 7:11
  SPEAKER_01: Well, we can help with that because we have all the plumbing there.
• 7:14
  SPEAKER_01: That's cool.
• 7:14
  SPEAKER_01: And then we also realized what's the story for the US for stable coins?
• 7:19
  SPEAKER_01: We we live in the US dollar.
• 7:21
  SPEAKER_01: What is a stable coin's value to us?
• 7:23
  SPEAKER_01: And I think the ultimate answer is it's instant settlement.
• 7:26
  SPEAKER_01: Anywhere that instant settlement would provide significant value, companies should be looking at inserting a stable coin into that process and using that as the settlement layer versus a bank braille or a visa or whatever.
• 7:37
  SPEAKER_01: And Visa and all these companies are responding to this.
• 7:40
  SPEAKER_01: But I think that was the cool, interesting tech.
• 7:42
  SPEAKER_01: And what's happening right now, and why we call ourselves a treasury management platform for stable coins, is because there is this addition that we're adding in terms of real world assets, tokenized kind of yield-bearing products from Wall Street.
• 7:55
  SPEAKER_01: There is this massive seismic movement that's still very early, but we think it's really where ultimately this is going to move.
• 8:01
  SPEAKER_01: And so Stable C is that platform that businesses use for enterprise grade problems in money movement.
• 8:08
  SPEAKER_01: That can be cross-border, that can be treasury management.
• 8:11
  SPEAKER_01: But we use stable coins in all of our practice to facilitate those solutions.
• 8:15
  SPEAKER_01: So that's that's us.
• 8:16
  SPEAKER_02: Okay.
• 8:17
  SPEAKER_02: And I would assume your customers are all mid-market and above, larger.
• 8:21
  SPEAKER_01: Yes, and no.
• 8:22
  SPEAKER_01: I mean, what we've tried to build is yes, we are we are focused on the mid-market and above because that's a hard problem to solve, honestly.
• 8:29
  SPEAKER_01: And it's a very risk-averse, conservative audience that wants to ensure and has to really protect their capital, their funds, and the process has to be what we kind of call bank grade across the board, right?
• 8:41
  SPEAKER_01: So they're accustomed to dealing with City and JP Morgan and Goldman, and that upper market is going to move a little bit more slowly and thoughtfully.
• 8:49
  SPEAKER_01: But at the same time, the lower end of the market, the SMB side of the equation, has similar but a little bit different challenges, right?
• 8:57
  SPEAKER_01: And so what we've tried to build is a platform that can kind of scale across those things while waiting for the enterprise to continue to develop, right?
• 9:05
  SPEAKER_01: So we offer higher yield than a community bank savings account.
• 9:09
  SPEAKER_01: We offer really easy on-ramping and off-ramping, but again, it's it's all B2B focused, all enterprise grade.
• 9:16
  SPEAKER_01: And again, like not DeFi, right?
• 9:19
  SPEAKER_01: So we're not using DeFi protocols or other more riskier all crypto web three types of uh investment products.
• 9:25
  SPEAKER_01: We are Wall Street, SEC backed, fully regulated, fully licensed, because we think that those are the products that will actually be adopted at scale over the course of the next three to five years in ways that are a little bit more practical for everyday use versus uh, you know, maybe some of the more riskier things that are kind of rolling around in DeFi land these days.
• 9:44
  SPEAKER_02: Okay.
• 9:45
  SPEAKER_02: Well, what would you say is the biggest challenge your company is solving for your customers right now?
• 9:50
  SPEAKER_01: Well, I mean, there's a few challenges.
• 9:52
  SPEAKER_01: One's an educational challenge.
• 9:53
  SPEAKER_01: I think that kind of what I was just saying, the the audience, while being risk-averse, I think is increasingly curious.
• 9:59
  SPEAKER_01: And so what we do is a lot of consultative work with our bigger enterprise customers, right?
• 10:04
  SPEAKER_01: So and that consultative work can be as simple as, hey, let's, you know, get on a hangout with executives and kind of with interested key stakeholders internally.
• 10:13
  SPEAKER_01: And let's just dive into what your transaction flows look like, right?
• 10:18
  SPEAKER_01: Where do we think that there's efficiencies that could be gained?
• 10:20
  SPEAKER_01: And then let's let's dive into a solution, right?
• 10:23
  SPEAKER_01: Because our platform is one of those types of platforms that is, it's can scale and grow and stretch in different directions.
• 10:28
  SPEAKER_01: It can be new automations that might make sense for one of our customers.
• 10:32
  SPEAKER_01: It could be new transaction flows into new markets as well.
• 10:36
  SPEAKER_01: We work across 42 different countries today.
• 10:38
  SPEAKER_01: So our breadth is really wide.
• 10:40
  SPEAKER_01: But within that breadth, anybody that works in payments knows the devil is really in the details when it comes to the transaction flows in these emerging markets, especially whether that's bank flows, mobile money, credit isn't really a thing.
• 10:52
  SPEAKER_01: But like Visa and MasterCard are in some networks, they have instant payment rails.
• 10:56
  SPEAKER_01: But like where you marry up and really combined combined crypto with these fiat rails, that's the tailoring and the building part that has to be done kind of case by case, depending on the needs of uh of our partners and our business.
• 11:09
  SPEAKER_02: Okay.
• 11:10
  SPEAKER_02: Well, what would you say differentiates stable C from your competitors?
• 11:14
  SPEAKER_01: I think there's a few key things.
• 11:16
  SPEAKER_01: One, we're exclusively enterprise focused, right?
• 11:19
  SPEAKER_01: I mean like we are just laser focused.
• 11:21
  SPEAKER_01: And when I say enterprise, I mean B2B focused.
• 11:24
  SPEAKER_01: Most of crypto is built for retail payments.
• 11:26
  SPEAKER_01: That was another like initial massive insight for us.
• 11:30
  SPEAKER_01: We set out originally to build a B2B rail for Cash App inside a block.
• 11:35
  SPEAKER_01: And we said, hey, you know, hey, partner X, we want to send one to three million dollars a day.
• 11:39
  SPEAKER_01: And we think that, you know, JP Morgan is kind of pricing it like this.
• 11:42
  SPEAKER_01: So we think that, you know, there's probably maybe some slight crypto premium.
• 11:45
  SPEAKER_01: But what we found is there was a lot of missing pieces in that payment solution that weren't going to actually meet our like business requirements, the actual cost, the funds flow themselves, even the non-programmatic way that a lot of these payments are being facilitated via a telegram chat or a phone call or whatever that might be to an OTC desk, those did not feel like scalable solutions for the actual real economy that was curious and interested, but needed more, let's call it, uh, like I said, bank grade or mature processes that could actually contract, be a counterparty to, and have the depth of liquidity to actually fulfill those larger requests over a million to$10 million.
• 12:26
  SPEAKER_01: And so we we saw that, and that was part of the opportunity, but it's also what differentiates us today.
• 12:31
  SPEAKER_01: I mean, companies come to us because they recognize, hey, there's a path toward deep liquidity, programmatic payments, but also a single pane of glass that manages all of that complexity across multiple wallets, multiple national and international bank accounts.
• 12:46
  SPEAKER_01: And that is pretty unique.
• 12:48
  SPEAKER_01: I think we're really skating to where the puck is like kind of heading and going to move.
• 12:53
  SPEAKER_01: But you know, it's it's still early, and that's kind of where we see the next three to five years really is growing in that direction in in terms of comfortable experiences that are driven by this technology underneath the scenes or kind of underneath the covers of it, which is really Web3, but it feels safe and it feels more like Web 2.
• 13:13
  SPEAKER_01: It's more familiar than a lot of the experiences that I think keep a lot of folks away from using these like DeFi Web3 products today.
• 13:20
  SPEAKER_02: Okay.
• 13:21
  SPEAKER_02: Well, let's talk a little bit about the future.
• 13:23
  SPEAKER_02: Where do you see the biggest growth opportunity for your segment of payments?
• 13:27
  SPEAKER_01: Well, I mean, opportunities are massive.
• 13:29
  SPEAKER_01: I I don't think the cross-border payments is solved yet at its scale.
• 13:32
  SPEAKER_01: I don't think that it's there yet.
• 13:34
  SPEAKER_01: I think there are like for enterprise companies with multinational.
• 13:39
  SPEAKER_01: So I think there's kind of three major problems that I think are still very much unsolved.
• 13:42
  SPEAKER_01: Cross-border payments, though there are a significant number of entrants to solve that problem in a bunch of different ways.
• 13:48
  SPEAKER_01: Some licensed, some heavily licensed, some underlicensed, some orchestrating, some doing these other techniques.
• 13:54
  SPEAKER_01: But depth of liquidity and then fulfillment time in certain markets, absolutely still ripe for solving, especially in emerging markets.
• 14:04
  SPEAKER_01: I think trapped cash, what we call trapped cash, which is essentially I'm a large multinational.
• 14:10
  SPEAKER_01: I run this process every quarter to basically pull revenue out of my various markets in which I operate.
• 14:17
  SPEAKER_01: That is not a solved problem.
• 14:18
  SPEAKER_01: We have a ton of inbound from big companies that are basically saying, hey, I got this issue in Egypt, hey, I've got this issue in Argentina, hey, I've got this issue in Nigeria.
• 14:28
  SPEAKER_01: They're generating revenue there, but either there's local capital controls or there's, you know, kind of some issue where the central bank does not actually want those local fiat currencies to convert to dollars and then be repatriated.
• 14:41
  SPEAKER_01: So there's tax questions, there's actual like central bank questions in terms of like how much money can come out of a country at any given time.
• 14:49
  SPEAKER_01: We help with all of those scenarios.
• 14:51
  SPEAKER_01: And then also there's this background like how will companies manage their treasuries in the future where they have this complex environment of digitized assets and then also fiat assets that are sometimes at banks, sometimes in wallets.
• 15:06
  SPEAKER_01: You have this quickly fragmenting ecosystem of financial tools that are available.
• 15:11
  SPEAKER_01: And what we're really trying to do is bring all of that again into a single pane of glass and allow for our customers to understand their bank balance across many, many markets.
• 15:20
  SPEAKER_01: So, like again, 42, 45 different countries, US, Canada, emerging markets, et cetera.
• 15:26
  SPEAKER_01: And then also understand what my digital asset portfolio looks like, and then take action.
• 15:31
  SPEAKER_01: I think like that's the massive thing that's missing from a lot of these solutions.
• 15:35
  SPEAKER_01: There's there's visualization without the ability to actually act in real time or to set up rules and have automation engines that are sweeping and moving in a very thoughtful way, but are really accommodating for real business use cases.
• 15:48
  SPEAKER_01: And so that's the platform that we've built.
• 15:50
  SPEAKER_01: We heard all of that in the beginning, like painful to move money.
• 15:53
  SPEAKER_01: And then we were like, well, also painful to manage wallets and to understand what's happening inside of all of these various complicated markets.
• 16:02
  SPEAKER_01: Cool.
• 16:02
  SPEAKER_01: Well, we can see across all of this.
• 16:04
  SPEAKER_01: Let's actually bring all of this into a single view and again make it actionable.
• 16:08
  SPEAKER_01: So that's where we're where we're at.
• 16:10
  SPEAKER_01: And I think anything that's like kind of like future oriented in that direction, I think you'll find us really pressing into those spaces.
• 16:17
  SPEAKER_02: Okay.
• 16:18
  SPEAKER_02: Well, what does success look like for stable C in the next, say, three to five years?
• 16:23
  SPEAKER_01: It's probably the startup dream, honestly.
• 16:25
  SPEAKER_01: It's it's being the household name, you know, that that trusted financial professionals and people in payments look to and think like, oh yeah, stable C, we got to talk to those guys because they understand what's going on.
• 16:36
  SPEAKER_01: And then we we build a tangible, valuable business that has, you know, customers that trust us.
• 16:41
  SPEAKER_01: We're incredibly people forward.
• 16:42
  SPEAKER_01: Like we, when we founded the company, we looked at all of the things that were frustrating about being in big organizations and kind of feeling a little bit like, you know, you can kind of just feel like a number or a cog in a machine sometimes.
• 16:54
  SPEAKER_01: And we never wanted the experience of working with us to feel like that.
• 16:58
  SPEAKER_01: And so we we've really tried to press into that as people and put people forward and be very relationship-driven.
• 17:04
  SPEAKER_01: And so I think for us, if we have a tangible kind of like scaling business in the next three to five years that's providing real value, and you know, we're employing people and have built a team of like just really world-class people that we love and are caring for, and we're taking care of our investors and doing all the things that startups are supposed to do along the way.
• 17:23
  SPEAKER_01: And I think, man, like that's I can't think of anything that would be more successful.
• 17:27
  SPEAKER_01: Of course, like, but we need the customers, we need the revenue, we need all the normal stuff.
• 17:31
  SPEAKER_01: But I really believe that if you do the right thing every day, you know, and you work hard at it, good things happen.
• 17:37
  SPEAKER_01: And I think I've already felt that over the last 18 months on this journey.
• 17:41
  SPEAKER_01: Together, you know, we've grown from that five that I mentioned a couple of minutes ago.
• 17:44
  SPEAKER_01: We're 12 people that are just really diligently working in this problem space and having amazing conversations, building a real business and and I think also doing tangibly good things with regards to this technology in terms of making it a little bit more accessible, understandable, all that kind of stuff.
• 18:01
  SPEAKER_02: Okay.
• 18:02
  SPEAKER_02: Okay.
• 18:02
  SPEAKER_02: Well, when you kind of zoom out and look at the the broader payments industry, what do you think are some of the biggest trends that are reshaping the space right now?
• 18:11
  SPEAKER_01: Well, I think that instant settlement comment that I made about stable coins, and like if you step back and you think, what is the value of a stable coin?
• 18:19
  SPEAKER_01: I really think that in most cases it comes down to instant settlement.
• 18:22
  SPEAKER_01: Like any way, like if we look across the broadest parts, sorry, if you look broadly across the payments ecosystem, you go, well, anything that's T2, anything that's T1, if you inserted an instant settlement component, call it a blockchain, a public ledger, whatever piece of the crypto tech that's important for that scenario, if you put that in there, does something good happen?
• 18:43
  SPEAKER_01: Does the industry react in a positive way and say, like, oh yeah, awesome?
• 18:46
  SPEAKER_01: Like, but it it changes a lot of the dynamics.
• 18:48
  SPEAKER_01: T2, like in some cases, it works well because, hey, I can place my order on Monday, but I don't actually actually have to pay for it until Wednesday.
• 18:55
  SPEAKER_01: In some markets, like that's an advantage.
• 18:57
  SPEAKER_01: In some of the derivative markets and other places, you're like, okay, maybe instant settlement doesn't always work well in that scenario.
• 19:02
  SPEAKER_01: Or maybe a lot of things in the settlement layer outside of just like the actual value moving are going to need to be updated as well.
• 19:10
  SPEAKER_01: So I think that, you know, from a technology perspective and and maybe, you know, just from a general payments perspective, we use credit and we use banks to have a what feels like an instant payment system in the US, but it's really not an instant payment system, right?
• 19:28
  SPEAKER_01: It's it's all on liability, it's all on banks, you know, transferring balances, it's all on, you know, we know that auth and settle are two different transactions.
• 19:35
  SPEAKER_01: And yes, that transaction is off, it's not settled, you know, till the next day, which means then the funds don't actually show up till the next day.
• 19:42
  SPEAKER_01: So there's all of these systems, even in the US financial kind of world, that we have made to feel instant, but are not really instant.
• 19:49
  SPEAKER_01: And so I think stable coins and then the technology that sits underneath it could be very disruptive in some of these places, but we'll see.
• 19:56
  SPEAKER_01: You know, like there's a lot of entrenched interest.
• 19:59
  SPEAKER_01: I think there's a lot of amazing work that's been done to give us the experiences that we have.
• 20:04
  SPEAKER_01: And I don't know that the whole thing is going to turn over overnight, but I do think that slowly, slowly, suddenly is another phrase that I'm really, really fond of.
• 20:12
  SPEAKER_01: And I think that we're kind of somewhere around that second slowly.
• 20:15
  SPEAKER_01: Like for a long time, it was like stablecoins and crypto was like this like, oh, ooh, I don't know.
• 20:20
  SPEAKER_01: Like that's for like DeFi, the, you know, like crypto bros, and that's like a different world where now I think it's it's getting sucked into the mainstream.
• 20:27
  SPEAKER_01: I mean, like, you know, when Goldman and Charles Schwab and they're they're making ETS for Bitcoin and all this cool stuff is happening, you think like, okay, like there is a draw on the traditional side of the house that is going to start to incorporate a lot of this tech.
• 20:41
  SPEAKER_02: Okay.
• 20:41
  SPEAKER_02: Well, a couple of final questions.
• 20:44
  SPEAKER_02: So if you could go back and give yourself advice at the start of your career, what would that be?
• 20:49
  SPEAKER_01: Buy Bitcoin as early as possible.
• 20:53
  SPEAKER_01: No, I I have actually an interesting story.
• 20:55
  SPEAKER_01: In 2013, I had an 18-year-old kid.
• 20:58
  SPEAKER_01: I was working late at a startup that I was working at in Portland, and we were sitting there together, and he goes, Hey, do you have$10,000?
• 21:04
  SPEAKER_01: You don't know what to do with right now?
• 21:05
  SPEAKER_01: And I was like, I just had a couple of kids.
• 21:07
  SPEAKER_01: I was like, not really.
• 21:09
  SPEAKER_01: And he goes, I said, Well, what do you want to do?
• 21:11
  SPEAKER_01: And he goes, I want to build a Bitcoin miner in my room.
• 21:14
  SPEAKER_01: And I think I can do it for about six, seven thousand dollars.
• 21:17
  SPEAKER_01: It's 2013, so the price of Bitcoin, I don't even know.
• 21:19
  SPEAKER_01: Somebody could probably look this up, but it's it's like less than a hundred bucks.
• 21:22
  SPEAKER_01: And I think, and I said, Well, what like what's my term?
• 21:24
  SPEAKER_01: Like, how quickly am I gonna this is gonna take to get my ten thousand dollars back?
• 21:27
  SPEAKER_01: And he kind of like does like a little math on the side and he goes, I don't know, maybe a year.
• 21:31
  SPEAKER_01: And I was like, nah, I think I'm good.
• 21:34
  SPEAKER_01: And that was probably the worst dismissal of an idea that I've maybe ever had in my entire life.
• 21:40
  SPEAKER_01: I we would be having a completely different conversation.
• 21:42
  SPEAKER_01: And but the advice that I would give and I give to my kids is they're kind of like getting to that point where they're gonna have to think about what their career looks like.
• 21:49
  SPEAKER_01: I've got kind of older kids.
• 21:50
  SPEAKER_01: And I think it's just, you know, you you treat people well and good things happen.
• 21:54
  SPEAKER_01: I mean, there's always like a doomsday on the horizon, like all that kind of stuff is always out there, and especially.
• 22:00
  SPEAKER_01: Especially working in payments and in financial technology generally.
• 22:03
  SPEAKER_01: But we typically find a way to survive.
• 22:05
  SPEAKER_01: And yes, things change, but just keep treating people well, do the right thing every day, and you know, good things will happen.
• 22:12
  SPEAKER_02: Okay.
• 22:12
  SPEAKER_02: Well, what's one thing that payment leaders that might be listening today should really be thinking about right now?
• 22:18
  SPEAKER_01: Well, I mean, selfishly, I don't think that you can ignore what's happening over on this side of the board.
• 22:24
  SPEAKER_01: So when the reason why I'm on this side, like I my my metaphor at the time was like I was sitting in traditional payments land and we were trying to do all of these things at Cash App.
• 22:32
  SPEAKER_01: And so my job at Cash App, if you were wind back like a couple of years, was expand Cash App outside of the US.
• 22:38
  SPEAKER_01: Anybody that's tried to like do a multinational payments platform recognizes that it's really just a patchwork of many platforms that you're stitching together loosely with a brand and you have relationships like your product in the UK is a little bit different than in Europe and in the US and in Canada, and you have maybe some loose association of a platform, but you've got all of this like integration work that you've done country by country, kind of like central bank or like uh regulator by regulator.
• 23:04
  SPEAKER_01: And I looked at that and I was like, man, that's this doesn't feel very scalable.
• 23:08
  SPEAKER_01: And then you had at the same time all of this stuff happening at the other side of the casino, and there was all this enthusiasm like in crypto for, hey, we could build a Bitcoin app that could go to a hundred countries in one foul swoop, and we have one entity in a hundred countries.
• 23:22
  SPEAKER_01: And I was like, how?
• 23:23
  SPEAKER_01: Dude, that's that would be incredible.
• 23:25
  SPEAKER_01: And so my point with all of that though, and to I think kind of more directly answer your question is I think that these worlds are quickly coming together.
• 23:32
  SPEAKER_01: I think that if you're working in a more traditional environment, we have a ton of interesting conversations with, you know, companies that are very much in TradFy land, but they know that there is something happening over here.
• 23:45
  SPEAKER_01: I would say, like, if you have that instinct, if you're listening to me and if you've come this far in this conversation, don't ignore that instinct.
• 23:51
  SPEAKER_01: I would say press into that and be a leader inside of your organization to like kind of promote some of that change.
• 23:57
  SPEAKER_01: Do it thoughtfully, do it with a ton of research.
• 23:59
  SPEAKER_01: But there are plenty of data points, I think, at this point, that I think indicate that there's there's something that's tangibly happening on this side of the board.
• 24:07
  SPEAKER_01: And there's going to be real innovation that gets built using crypto-like technology back into TradFi in ways that I think are going to be really cool, whether that's tokenized deposit work or whether that's launching a stable coin, or whether that's figuring out how to use stable coins or other tokenized assets.
• 24:24
  SPEAKER_01: I think we're probably a few months away from final legislation which clarifies some of the yield components of this.
• 24:31
  SPEAKER_01: But once that gets nailed down, once we have clarity, man, I just think companies should be building now, anticipating one of two outcomes, either stable coins can directly pay yield or they can't.
• 24:42
  SPEAKER_01: I don't know that that actually matters because you can just flip from strategy A to B and go, cool, we'll do something in stablecoins to pay yield.
• 24:49
  SPEAKER_01: Cool.
• 24:50
  SPEAKER_01: We'll work in yield-bearing assets that are issued from Wall Street firms.
• 24:54
  SPEAKER_01: Either way, I just think it's it's a good moment in time to get smarter and to uh yeah, to press into your curiosity and see what it's like on the other side.
• 25:02
  SPEAKER_02: Okay.
• 25:02
  SPEAKER_02: Well, Tony, I think that's a great way to wrap up the show.
• 25:05
  SPEAKER_02: So I know your time is very valuable, so I really appreciate you being on the show today.
• 25:08
  SPEAKER_02: So, Tony, great meeting you, and thanks again for being here.
• 25:11
  SPEAKER_01: Yeah, appreciate it very much, Greg.
• 25:13
  SPEAKER_01: Take care.
• 25:13
  SPEAKER_01: Have a good one.
• 25:14
  SPEAKER_02: And to all you listeners out there, I thank you for your time as well.
• 25:16
  SPEAKER_02: And until the next story.
• 25:18
  SPEAKER_00: Thank you for joining us this week on the Leaders in Payments Podcast.
• 25:22
  SPEAKER_00: Make sure you visit our website at leadersinpayments.com, where you can subscribe to the show and where you'll find our show notes.
• 25:29
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