Why Stablecoins are Set to Drive a Global Payments Frenzy

Stability has never been a characteristic bequeathed on cryptocurrency. And yet, right now, the market for stablecoins—crypto tokens pegged to fiat currencies like the U.S. dollar or the euro—is accelerating at a frenzied pace, surging past $200 billion at the end of 2024. As a tool for facilitating fast, inexpensive payments around the globe, crypto looks poised to potentially disintermediate banks. That said, what role can traditional banks and financial institutions play in the crypto craze? Crypto executives and thought leaders examine the possibilities and who is most likely—and why—to capitalize on the advancement of stablecoin payments.


Transcription:

Jeff John Roberts (00:09):

Thanks everyone for joining us. Just to sort of get a sense of the room, who here could say define with certainty what a stable coin is? Okay. Who has heard of a stable coin? Okay, that's more like it. Okay, so first things first, Paul, can you summarize, define a stable coin in a minute or less?

Paul Brody (00:31):

Yeah, I mean basically a stablecoin got the name stablecoin because cryptocurrency is remarkably volatile. And so originally people who are transacting cryptocurrency, they were trading, they from time to time wanted to get out of the market without exiting the blockchain ecosystem. They're like, I want something stable. And so someone said, you know what? How about the US dollar? And so it's the stable coins were born initially on the Bitcoin blockchain and then later on stable coins became really foundational for all the kinds of transactional services that are being done on other blockchains. Almost always something like 99% of all stable coins out there are US dollar stable coins. Most of the time they are backed by actual US dollars. So they're a little bit like a money market fund. They're funded by US bonds or high quality corporate bonds or treasuries. Occasionally though there are also something called algorithmic stable coins, which are funded by non-US dollar items or other types of items, especially volatile crypto assets.

(01:34):

And there's a mathematical formula that says, based on the market price of this asset, we will hold so much reserve funding. Algorithmic stable coins are not very common. They're like, I think 10 or 15% of the market, 85% is probably US dollars. And there's now an emerging category of things like pound stable coins, yen stable coins, euro stable coins. There's pure cash stable coins. It's an exploding market that's doing trillions of dollars in transactions. The big driver is that fundamentally the vast majority of people, we get paid in dollars or our local currency. We buy things, we sell things, we pay our taxes in those currencies. And so when using a new financial system, I think people mostly want to transact in the currency they already know and understand.

Jeff John Roberts (02:20):

So it's a pegged currency. Just like some countries pegged the currency of the dollar stable coins are one to one. You keep it in the crypto realm too because also historically cashing out triggers like tax implications and stuff. So if you want to sit there and speculate with crypto, if you have these stable coins and you can go in bet on whatever crazy thing you want cash out, put it into a stablecoin, typically Tethers the giant one and USDC, which Coinbase has a stake in as well. And then some of you might've heard that crypto is unstable and volatile and blows up sometimes the last catastrophe along with SBF right before it was an outfit called, my goodness,

Paul Brody (02:57):

Terra Luna.

Jeff John Roberts (02:58):

Yes, Terra and the guy I think is in jail are being extradited as happens with a lot of these crypto people, but he had a peg stable coin that wasn't really pegged. And obviously that can go on only for so long. If people realize the pegs broken, then everything blows up quickly. But to be clear, Tether, as far as we know and USDC certainly have got verified reserves backed by T-bills. It's a good business to be in too because if you own them, they don't pay interest typically. And so if you are in a high interest rate environment, you have this pool of reserves and it's a great income stream. So let's go to you Mark. You're doing a lot with stable coins. How's Coinbase using them or why is stable coins important?

Mark Troianovski (03:35):

Well, stable coins are really important at Coinbase for a lot of reasons, but really for the same reasons that they're important for everybody engaged in financial services. One of the things that's really important for Coinbase is to invest more and more in payments utility specifically. Not only do we believe, but we see the value of stable coins to increase, decrease settlement speed times in payments, both consumer and business use cases decrease the cost of payments. And so we're doing a lot in the US as well as internationally with our international expansion efforts to make it easier for people to become owners of stable coins in their custodial accounts at Coinbase as well as find new ways to use them. So whether it is with our retail products like our debit card for instance, or our investments in on chain payments, stable coins are really important for us because we see it not just as a way for people to, for instance, get away from inflation and get easy access to the dollar in the emerging markets, but really it is a new payment rail that we think is superior to a lot of the payment rails that we have today.

(04:53):

Not entirely meant to replace them, but certainly something that is competitive and can drive a lot of value for users and businesses.

Jeff John Roberts (05:01):

And my understanding for people purely from the banking sector, these aren't a new thing. I mean there's been something called JP Morgan coin kicking around forever, which is if I understand a tokenized version of the dollar and they settle bounces within the bank using that across different jurisdictions. But that's a sort of proprietary in-house thing and doesn't go beyond that as far as I understand. Sara, do you want to sort of expand a bit on how banks are using them?

Sara Sisenwein (05:26):

Well, I think there's a huge opportunity for banks to get into the stablecoin space. Specifically on the reserve side you have to hold one-to-one US dollar. There's plenty of banks out there that would like to hold those dollars. And additionally, I think there's a huge opportunity in terms of potentially listing your own token and enabling that for the speed of payments, specifically cross-border payments like Mark said, I think the ability to reduce the cost of payments as well as increase the speed is really where the true value is, which will really change the face I think, of cross-border payments in terms of the ability and ease to move money between different countries without the burden of a percentage per tran.

Jeff John Roberts (06:09):

Yeah, and Reid, do you want to first describe it superstate as then make your case for stable coins, why anyone would need such a thing?

Reid Cuming (06:16):

Superstate is a RWA asset manager here in the United States. It builds infrastructure and technology to tokenize more traditional assets and make them usable on the blockchain. Like Ethereum stable coins are incredibly useful for our clients specifically as it allows them to purchase or deem shares of these funds. One of them is a tokenized TBI fund, another one is a tokenized crypto derivative fund and it just makes it wildly simple for their operations to not have to go in and out of US dollars to get access to a different exchange that way and allows for simplified accounting for them as well. So it really does improve the efficiency of money, the speed of it, as well as the ability to account for it much more transparently for all of our clients. And we think that's generally going to be a benefit to pretty much anyone that actually interacts with stable coins.

Jeff John Roberts (07:03):

Yeah, unless you think this is like a fringy crypto thing, it's notable that PayPal's got a stable coin on this company called Paxos in New York that works very closely with banks and they issue white labeled stable coins. But Paul, I mean you're from Ernst and Young, which is not exactly a fringe brand, so why are you involved in it or make the case for us why these things are necessary and are not just a Fed or are they,

Paul Brody (07:27):

They're definitely another Fed. And I also want to come back to something you said earlier. I just want to point out nobody on my team has gone to prison yet. I don't personally feel like I would do that well in prison. So we try very hard to stay on the right side of the law in terms of stable coin payments, there's a huge number of use cases. Consumers are picking these up enormously and particularly in emerging markets, people want dollars. Brazil is a great example. Customers of Nubank in Brazil can now get USDC directly into their accounts, which is a big deal. We estimate that making a US dollar payment using blockchain rails like Ethereum instead of traditional banking rails cost about 90 to 95% less. And EY has been taking, so EY has been receiving stablecoin and crypto payments from our clients for a few years now, but something very special happened last year, which I want to briefly talk about, which is we received the first business to business, fully automated payment in a stable coin from PayPal.

(08:29):

And we did this working with SAP and with Coinbase and with PayPal. So PayPal was paying an EY invoice, we did some work for them. And because SAP has now added a cryptocurrency wallet to S/4 HANA, which is their ERP, so their operating business operating system, PayPal was able to say pay this invoice. Normally that would've gone through traditional banking like a wire transfer. Instead it went through crypto rails, it was sent from inside of their SAP system. It was sent to EYs account at Coinbase. Our ERP system showed it as received in Coinbase. It showed that money set up as cash in EYs accounting system and marked the PayPal invoices paid. And once you can do this level of automation, you can start to scale up B2B payments or B2C payments on crypto rails. And just to give you a sense of the scale of the opportunity, we estimated that if we could, and to be clear, we can't for all kinds of regulatory reasons, but if we could theoretically move all of our B2B payments from traditional banking rails to crypto rails, we could save ourselves about a hundred million dollars a year.

Jeff John Roberts (09:41):

But hang on, where is that savings come from? Just wire fees or,

Paul Brody (09:44):

Yes, right. The big obstacle was the lack of automation, right? In the 12 or 18 months ago, if we had tried to do this, our manual processing costs would've swamped all the savings. But now that we have this integration with SAP and it's a standard tool that you can build, we can get the reverse, we can get all, it basically costs us no more from an internal operating perspective to do a crypto rails payment, but we get all the bank fee reductions.

Jeff John Roberts (10:11):

Okay. I mean, just sort of devil's advocate, if you're a bank sitting in this room, it sounds like the wire business is a pretty good business. Why should they turn away from that?

Paul Brody (10:21):

I don't think they will. I think for some time this is going to act as a little bit of a form of differentiating parts of the market. So for those who can, I think banks want to offer stable coins, they don't want to lose those customers and we're going to see an absolute stampede to banks into stable coins. But if you don't have that capability, I think banks continue to want to move that through. And remember, the recipient also needs a bank account or a crypto account, and so it's not easy to make this move over and I think that'll be the case for quite some time. But the thing that everybody, if you're a bank needs to remember is that oftentimes you're most sophisticated and most valuable clients make those transitions first and so you don't want to lose them.

Jeff John Roberts (11:03):

Okay, makes sense. Well hustle work playing out on the ground. Mark and Sara, in terms of you go to a company and say, wow, this is the best thing since sliced bread. What does the CFO say? What does the controller say? I mean, is it a hard sell?

Mark Troianovski (11:17):

It's really not. One of the things, so a CFO or a controller or a CLO at a bank for instance would say, okay, well there's going to be regulatory clarity on the horizon. There's going to be things like SAB 121 relief or entire repeal and then let's talk.

(11:35):

And the moment that that becomes clear to those CROs and CLOs, there's, it's actually a very easy sell. I'll give it just an example. You can be a Chase customer, you can have a Chase credit card, and then let's say you make a really large purchase on your credit card and you need to pay it down, but let's say you don't have enough money in your checking account to cover that, and so you want to dip into what you have in a money market fund. Also at Chase, the number of days it will take to get the money from your Chase money market fund to pay off your credit card bill is going to be one to two days, depending on the cutoff window to get from money market funds into your cash account in your JP Morgan brokerage and then another one to two days to get that into your Chase checking account and then you can pay it.

(12:22):

So if you're Chase and they create amazing customer experiences for folks all up and down the spectrum, you're going to want to cut that down to instant. And one way to do that could be with tokenized money market funds. Another way to do that could be with US dollar backed stable coins. And so on the ground, I would say it's really a, at this point, depending on who we're talking to, if it's a heavily regulated financial institution in the US, it is a when, not if. And then for some of these other larger corporate firms that may not directly be in the flow of funds like what Paul was talking about, that's happening now. And it's happening both for companies that just do business in the US as well as companies that are doing business across five to 800 entities that are Fortune 500 companies that need money moved from one tough emerging market, maybe repatriated back home. And so the velocity of those conversations has really intensified in an exciting way and I think that banks can participate in some of that upside too.

Sara Sisenwein (13:29):

I hear similar stories. It's not a question of if it's a when for sure, and it's how can we do this the right way? Specifically I was talking to a CEO at a bank the other day who banks cannabis in a big way and they're taking their armored trucks and going and picking up the cash and then dropping it off directly at the reserve. What if there was an opportunity to have a wallet where the user ahead of going into that cannabis location converts the dollars into stable coins? The stable coins are then moved without actually moving physical dollars in armored trucks. Now you're de-risking an entire industry that really is underserved. So that was their use case in terms of how they see Stablecoin breaking down barriers in terms of risk for them.

Jeff John Roberts (14:15):

Interesting. I think Mark, you mentioned tokenizing things. Let's make that a little less abstract. I think we get it in the broader picture. You go and represent tokenize it, represent it as an asset on the Ethereum block, typically the Ethereum blockchain, there's other blockchains of course, like Salona and stuff is popular and it's there and blockchains create this tamperproof public ledger that's sort of immutable. And you can also feel in the private sector, you can create sort spin up versions of it, go talk to Paul and he can give you one so the whole public doesn't see it and so on. But I'm sort of clear from a trading platform perspective, what sort of software do you need? This might be one for you, like okay, it's all well and good, do you want to tokenize and do this and that, but what exactly do you need? What sort of software do you need to integrate among your accounting team? What's the dashboard look like and how do you take the step of tokenizing something, you've got these T-bills, what happens to make them tokenize?

Reid Cuming (15:09):

Yeah, I think it's fairly simple and maybe not as magical and mythical as you might think. Really tokenization today, at least in the wild, is more of a how do you represent a traditional asset on the blockchain, we're not doing primary issuance. The US government is not printing T-bills to the blockchain. It's not using cash on the blockchain. So everything is really just held in reserves at a normal custodian and you then represent the shares of that reserve as a token instead of a certificate or uncertificated share you might get at a brokerage. So you can view the blockchain really as just almost like a smashing down together into one thing, like a savings account in which you can hold a variety of different assets that really in themselves are the issuer. They don't really need too many either bells and whistles. So to tokenize these assets, it really is collect the funds you need to go purchase the underlying for that fund or for that sort of class and then you purchase that class of assets, hold them somewhere else usually, and then you tokenize shares of that asset class. The tokenization itself can take a variety of different dynamics. If it is a stable coin, it really is just kind of a one to $1 matching and then you just manage the peg on mark to market or if there's some sort of an actual secondary market.

Jeff John Roberts (16:27):

But who does that? Do you call it Mark and say, can you please tokenize a million dollars for me? Here's my deposit. How do you actually, what's the instant thing? Or it goes from non token to token?

Reid Cuming (16:37):

Yeah, I can describe what we do. It's superstate. I think there's maybe a variety of ways to do that. At supers say it is very traditional in the sense of their private placement funds where an investor can subscribe to those funds using US dollars with a wire or USDC. Once that's received, they then are immediately generated shares where they can be minted onto the blockchain into their wallet or into what we call book entry database where you can just see it on an investment portal. So it can happen instantly where you can't convert the fiat or the dollars that you want to invest into the actual tokenized share of the underlying asset.

Jeff John Roberts (17:17):

Paul, is there anything I haven't asked on this process? If everyone here is hearing this and wants to run home and start tokenizing stuff, what else do they need to know?

Paul Brody (17:25):

So one of the key questions, this is becoming a huge issue. So if you think about all of these markets are money for stuff and there's tokenization. If we're tokenizing just US dollars or Euros or Japanese yen, it's relatively straightforward. The big thing that's emerging now is this tokenization of real world assets, all the things I'm going to buy with my US dollars. And there the question is, okay, how should I package it? And I'll give you one of my favorite examples. Real estate. You can buy an entire house from a company called Propy. It as a single token represents an entire house, but you can also buy a square meter of real estate in Thailand. It's kind of like a composite standardized square meter. And one of the big issues that we're going to go through in the next few years is with the regulatory clarity coming and in a world where you can tokenize anything at all, what should you tokenize?

(18:17):

How should you package it? We have in stocks for example, or bonds, we have a limited number of ways in which we package things and we know how to make them sort of comparable to apples to apples. We haven't quite reached that point where all kinds of different exotic asset classes that can be taken that are illiquid today, private loans, private equity, and can be turned into liquid tokenized assets that are transactable anywhere and all. I think the biggest challenges are not going to be around the coins, the stable coins like the dollars. It's going to be about the stuff you want to buy with the dollars.

Jeff John Roberts (18:50):

Yeah, that seems, I think you're right, but I think that see that more as five years out, whereas the stablecoin thing seems kind of a year or is here right now.

Paul Brody (18:59):

In that case, I would say the other big issue that people are working through is the seamless integration and one of the most impressive, you asked me about East Denver, the single most impressive thing I saw at East Denver was META'S integration with MasterCard. Meta Mask is a popular crypto wallet. You can have all kinds of different crypto assets in it. They now have a function where you can basically get a MasterCard that takes things from your crypto wallet and liquidates them into US dollars instantaneously. When you transact, it's not a prepaid card. You can put ET on there, you can put US dollars, you could put any kind of crypto asset. And I'm not kidding you, it took me 10 minutes to get from Meta Mask wallet to MasterCard in my Apple Pay wallet, and I then went and bought a burrito and it deducted that money from my Ethereum balance in the meta mask wallet.

(19:50):

And so the next battle is going to be, we are going to reach a point where stable coin payments and crypto wallets are so tightly integrated into traditional parts of the payment system that most consumers, and I think about my 16 and 17-year-old sons, by the time they get to college and open their bank accounts, I don't think they're going to be able to tell the difference. They're going to be like, wait, what's FDIC insurance? What is that? Why should I go to a bank instead of just signing up for this app? I believe that is going to become very important and from an education perspective, hugely important for people's safety and security.

Jeff John Roberts (20:25):

And I do think it's remarkable that the people going to college right now are crypto literate. Most of 'em had this talk 10 years ago. It really would've been, what's a blockchain? What's crypto? But there's whole generations to whom this is native. Not everyone uses or likes it, but it's not a new concept. Going back to the one thing that strikes me about stable coins is so there's two giants. There's Tether, which is this weird offshore badmouth. They're a little bit dodgy, where's their headquarters and stuff, but they're really pushing to go legitimate. Their CEO finally showed up in the US is in Washington. It's basically they got so big as someone puts me, they're going to have to go legal and they've got vast amounts of money because it's a really good business. They're not a lot of staff and just making interests on what they have, like a hundred billion dollars or something. It's a ridiculous amount of money. They're really rich. But then you have USDC, the Coinbase and Circle Partnership, you have PayPal, Robin Hoods coming into the game and everyone else is coming in too. So I'm curious, is this going to be a winner take all market or is it going to be, is there going to be a universal stable coin? What are you seeing? I'll kick that one to you Sara. How's that going to shake up?

Sara Sisenwein (21:30):

I think over time the market will concentrate, but for now at Eat Denver as well, last week I heard of about five stable coins that are about to launch in the near future. And I think there's opportunity out there to have a few stable coins per network unless you're an e maxi I know, but there's opportunity out there and I think we'll see a lot more stable coins come out before we see a contraction in the market and different use cases. And ultimately it'd be interesting to see how the banks integrate stablecoin and how maybe you can leverage your own stablecoin or support a stable coin so that it works to your favor to provide a sticky user experience. Ultimately what it is you want to provide more products to your users that keep them with the bank, that enables 'em to do things that they want to do without having to leave. And by adding a stable coin or multiple coins that will allow them to do that knowing that that opportunity is out there and maybe give them yield or other opportunities. Or another option could be like you support a wallet. It would be interesting to see if we had wallets powered by a particular bank or multiple banks in which you can have a light shine on you in terms of supporting stablecoin and the benefits that it brings.

Jeff John Roberts (22:51):

So you guys all agree it's going to be everyone's get a piece of it. If that's the case, PayPal an innovative company, I admire them, but they launched a big stable coin, but their market shares is pretty teeny tiny compared to the others. So is it possible that it's a winner take all thing?

Paul Brody (23:07):

I personally think this is the single most important question in this business is blockchain and crypto, is it the technology market or is it the finance market? And I personally think on balance, not in every component of the sector, it looks more like a technology market. We've been following this for about 10 years. I think we are headed towards in a number of areas, something that's close to a winner take all model.

Mark Troianovski (23:35):

I would say. I have a slightly different take on it, which is if you look at what the internet has done to communications and information, basically two large ecosystems. There's the Android ecosystem and then there's the Apple ecosystem. I think what's exciting about the internet meeting financial services is I think that there's potential to create a lot more winners than just one or two. I look at the history behind Visa and American Express as two really interesting examples where Visa started a consortium model that allowed at this point thousands of banks to participate in the upside of that network. And then you have the Amex model, which is completely vertically integrated and has a merchant acquiring business and a card issuing business. And that is much more of a winner take all for Amex in that ecosystem. But I think across financial services today you have a spectrum across from vertically integrated to the more Visa consortium model.

(24:43):

And I think you can, depending on the type of enterprise you are, you go to potentially a stripe where everything is really turnkey for you and you don't have to go to anyone else. Or if you're a more complex enterprise, you go to maybe someone like an Addean or an FIS where you can get things a little bit more bespoke for you. And so I think that financial services, there's just so many different types of payments needs out there. There are so many different types of banking needs out there, so many different types of banking customers that I think that there are going to be lots of different US dollar backed stablecoin ecosystems out there. But the beauty is that they don't need to be these walled gardens that don't talk to each other. They should be by design interoperable. And there are companies that already are doing quite well, like Bridge, which was acquired by Stripe for over a billion dollars whose entire business was making stable coins talk to each other. And so I think that in the same way that there are lots of large financial institutions today and lots of regional financial institutions today in the US that all compete with one another on various aspects of their business. I think there's probably going to be a lot of different stable coins out there in the future too that may be embedded within certain ecosystems, but the barrier between them should be lower.

Jeff John Roberts (26:09):

Yeah, that's an interesting thesis and thanks for bringing up bridge. I do think significant, if you're skeptical of crypto stripe we know is an absolute bandwidth and the fact that they spend that money to buy a stable coin company. So whether you like crypto or not, it's here. Reid let you weigh in on the who's going to win question.

Reid Cuming (26:25):

I think I kind of agree with both parties here. I think

Jeff John Roberts (26:27):

Well wait, he said it said we're take all those two said that it

Reid Cuming (26:31):

Win. I think his thesis is correct. It's a technology fundamentally this is all a technology. I think we've gotten a little bit too wrapped up in things that are not about the technology over time. And I kind of equate it to just other transitions we've seen in finance and payments over years from paper to telephones to computers to mainframes to the cloud. It's just a new technology that the industry will adopt over time. And within that technology there's going to be a variety of participants that are going to ultimately take pieces of the market over time. And we'll probably just have tiers of winners in some way. We'll have the Googles and the Amazons and the Microsofts of the world and then we'll have another layer and another layer and they'll serve very different use cases and audiences. And I think that's what we'll probably see with stable coins. I actually hope that's what we see with stable coins. I'd prefer that versus centralized monopoly blessed by the US government or someone else. I think it'd be better to have some degree of competition for those services.

Jeff John Roberts (27:28):

So a big, big, big pie. Yeah. Well speaking of the US government, I've heard their interest in this too and I think we are waiting stablecoin legislation which should clear it up and so on. But also, I mean I do think it is not technology in the sense that this is the US dollar, which I've say to people often the reason the US is a preeminent country is its military but also the greenback. It lets us borrow cheaply. It's a instrument of foreign policy and power and the US doesn't like you messing with it. We saw Trump warn countries don't do this and stuff and there's already talk of stablecoin corridors opening up in Asia among countries that might be adversarial to the us. So what's the latest very quickly from Washington, Paul.

Paul Brody (28:13):

Having just been there yesterday. So I had a chance to listen to, I was at a FinTech forum. I had a chance to listen to the chair of the CFTC and the head of the crypto task force from the SEC and to congresspeople one Democrat and one Republican. The thing that's very encouraging is there's strong bipartisan support for a stablecoin bill. They're still working out the details. One of the bills is called the stable bill. The other is called the Genius Act. I think we're going to get the Stable Genius Act when it's done, but I think there is an agreement that we need to provide a framework to do this and that doing so will protect the preeminence of the US dollar in this ecosystem. One thing that is super interesting to me right now are some of the battles around the details around like KYC and AML right now, the level, the playing field's a little bit on level.

(29:08):

If you're not a bank, you can enter the stablecoin business if you are a bank because stable coins are bearer instruments, you actually cannot until you get this green light from the bill. So all the banks that have announced that they're planning to enter the stablecoin business can't really do so until the legislation is completed. But this is enormously important because it will bring in a massive wave of competition to the existing players from incumbent banks who have all the deposits, they have all the cash and they have all the customer relationships. So to the extent that there is a multi-party future, we'll find out I think relatively soon because the competition is going to be intense.

Jeff John Roberts (29:48):

Great summary. I just want to throw it to the audience. Does anyone have a question for these stablecoin experts? Well, we have about seven months off. Throw your hands up is your question so far. There we go. Now please introduce yourself.

Audience Member Kara Revan (30:06):

Hi, I am Kara Revan with Discover. Question for the gentleman from Ernst and Young. You mentioned that use case of SAP and Coinbase and EY, how important is the ERP integration in being able to move the money? It sounds like you needed all players to have a Coinbase account and have that capability within SAP. So can you speak to that? The importance of the ERP?

Paul Brody (30:33):

So all the parties involved need to have some kind of a cryptocurrency wallet or access. In the case of SAP, they recognize sort of two options. One option is that you have an actual cryptocurrency wallet inside of SAP. That's great. But the truth is that most corporations don't actually want to be banks and they don't want to hold that kind of cash less they get hacked. So they would prefer to have an institutional partner like Coinbase actually hold the money for them. So in a B2B space, it's really important for everybody has to have a cryptocurrency wallet. If you are doing the large number of payments like an EY or some other firm, the automation that comes from inside your ERP system is extremely important because anything that requires a manual workaround is almost instantly very expensive. But things that are highly automated or can be done automatically are relatively cheap. And I think we'll see eventually we're going to see this in QuickBooks. We're going to see this in any kind of ERP system that you need in order to make these payments. It's the automation that's incredibly valuable in terms of scaling things.

Jeff John Roberts (31:40):

Good question. Thank you.

Audience Member Rebecca Schultz (31:44):

Hi, Rebecca Schultz from Boost Payment Solutions. Follow up question to that, you had mentioned that you estimated you guys could save 90% cheaper to do the full wallet transfer instead of traditional payment methods. Does that consider or include the cost of getting fiat into the stablecoin and then getting it back out from stablecoin to fiat or are you envisioning a world where this all kind of stays in stablecoin and is then transferred wallet to wallet around, you're now using your AR funds that you just received to make your AP payment the next day?

Jeff John Roberts (32:18):

Great question. Yeah, because you have to move out of the crypto rails to the fiat ones and that's not free.

Paul Brody (32:23):

It does not. Our calculation does not include that. We do assume right now, for example, if you pay EY in crypto or stable coins, we just convert it and put it in our bank account or Coinbase does that for us. I'd love for the gentleman from Coinbase to just talk about how seamless they're trying to make those transitions and transactions.

Mark Troianovski (32:42):

Yeah, so it's actually a great topic to bring up here because we're doing this in close partnership with our banking partners. And what we're doing is we're actually keeping the cost of a US dollar into a stablecoin conversion basically at virtually zero. Because what's happening is that we have these networks set up inside of banks that allow us to go in and out of stablecoin and back into the US dollar and vice versa 24 7. And that is free. That is an intra bank network. And actually Jeff, you had mentioned the JPM coin example, that's an example actually from the largest bank in the world that has a division that's recently called Onyx, now called Connexus, that is experimenting with such a network called JPM coin. And that is one of those ways to address this question that makes that conversion free. So I would actually say there's not much of a haircut to take off of Paul's estimate, if at all, given the innovation that we're seeing from the banking sector because the banking sector sees how important it is to have that very, very low cost bridge between fiat and stable coins.

Jeff John Roberts (33:58):

Great. It looks like we're about out of time. I just want to do a quick lightning round. I mean all this makes a lot is exciting, it's really interesting theory, but how long do we actually solve these last mile problems? And I guess I'll put it this way, what year will the majority of Fortune 500 companies be using stable coins in their treasury operations is good down the line, starting with you Mark?

Mark Troianovski (34:19):

I would say all Fortune 500 corporations.

Jeff John Roberts (34:23):

The majority,

Mark Troianovski (34:25):

I would give it 2027.

Sara Sisenwein (34:29):

I was going to say 2028.

Reid Cuming (34:32):

I was going to say at least by the end of the decade.

Paul Brody (34:34):

Yeah, 27, 28, something like that.

Jeff John Roberts (34:37):

Okay. Alright, so keep your eye on. Okay, well there's a lot to think about

Audience Member 3 (34:41):

Company should we be investing in.

Jeff John Roberts (34:45):

You're publicly traded, right?

Paul Brody (34:49):

Actually you are a private, sorry.

Jeff John Roberts (34:54):

Yeah, no, I don't think we're supposed to give investment advice up here. There's regulations against that. But yeah, please, a great panel learned a lot. So please give a hand. Thank you so much. Thank.