Banking Meets DeFi: The Great Financial Convergence | DAS London 2025 | Day 2 | Institutional
Summary
Market Outlook: The convergence of traditional banking and decentralized finance (DeFi) is seen as a transformative force, with major banks like Citi and Standard Chartered exploring blockchain and tokenization to enhance financial services.
Company Initiatives: Citi has launched City Token Services to facilitate 24/7 cross-border transactions, while Standard Chartered is advancing through ventures like Zodia Markets and Zodia Custody to integrate digital assets into their offerings.
Regulatory Environment: Regulatory clarity is crucial for the adoption of digital assets, with the need for consistent regulations across jurisdictions emphasized as a barrier to scaling blockchain solutions globally.
Stable Coins: Stable coins are recognized as a significant component of the financial ecosystem, with predictions of their market reaching $4 trillion by 2030, serving both as a back-end financial tool and a consumer payment method.
Tokenization: Tokenization of assets, including stocks and deposits, is gaining traction, with expectations of significant growth as regulatory clarity and technological infrastructure improve.
Infrastructure Challenges: While the base layer of blockchain infrastructure is largely in place, scalability and regulatory cooperation remain challenges for widespread adoption in financial markets.
Future Trends: The panel anticipates an acceleration in the adoption of tokenized assets and stable coins, driven by technological advancements and regulatory developments, with 2026 potentially being a pivotal year for these innovations.
Key Takeaways: The integration of DeFi into traditional banking is poised to revolutionize financial services, but requires overcoming regulatory hurdles and achieving interoperability across global financial systems.
Transcript
Hello. Um, very excited to talk about banking and DeFi with some banks and DeFi professionals. Um, let's start with a quick intro. David, did you want to kick us off? Sure. Uh, I'm Dave Cunningham. I lead strategy and partnerships for digital assets at City. It's an American startup bank uh, scaling uh, internationally. Uh, we're trying to do our best. Uh, but yeah, it's going going pretty well. Paul. Hi, I'm Paul Nuner. I'm the uh founder and CEO of Telcoin. So, we are a conditionally approved digital asset depository institution in the state of Nebraska, but also able to take nationwide clients. Um, we are planning to launch in December. U, it's been a long road. We started in 2017, so we're on year 8 already, and we're finally opening things up. Um, but we're also the first, uh, bank charter that is explicitly authorized to connect US consumers with DeFi. So very happy to be on this panel and appreciate the invitation. Jeff. Hi, I'm Jeff Kendrick. I run digital asset research for Standard Charted Bank. Uh people pretty much know my research for one of either two things. So I write research on public coins and tokens. Uh for example, in April 2023, Bitcoin was 25K. I predicted a move to 100K by the end of last year, which thankfully worked out quite nicely. um or on stable coins uh where Scott Bessant uses my $ two trillion dollar number um in Congress today. As far as I'm aware, I remain the only person in any bank globally doing this job full-time. So, I I just have to say monopolies are good when you're in the center of one. Hey, I'm Eric, uh co-founder and CEO of Injective Labs. Um and I'm currently CEO of Injective Foundation. Uh so Injective is a highly performant blockchain built for financial applications. Um it's been you know one of the top blockchains in the space uh specifically tailored towards uh advanced trading advanced financial inhstruments. Thank you. Uh so this panel is called banking meets DeFi. I want to start with the banks. David maybe you can kick us off first. How are you all thinking about DeFi? How has it changed in recent years? What kind of use cases? Tell us about your team. Um so essentially for us I mean city's been building and experimenting with blockchain since about 2014 or so. I joined in three years ago and uh uh essentially we didn't do a lot for a long time that that made it live. Uh in fact, you know, I I joined to lead our strategy and figure out, you know, what could we do to use this technology to help what we do today, which is move about $5 trillion a day in in my division. Um so where can this help? And there's kind of that dilemma, you know, are you trying to disrupt yourself or what are you trying to do? Essentially, uh the consensus reached was we're not trying to disrupt ourselves. were just trying to improve things and take advantage of what we have today and augment it with other capabilities. So uh thankfully we set about building something and we got city token services live as a as a solution uh which is was during the harder days of the previous US administration when um yeah you had to get things like a non-objection uh 1179 for to do anything or even to change slightly what you've you've already been talking about for years. So um yeah we we have something which we built which moves the dollar 24/7 uh cross border for our clients um and is going pretty well. But I think everything has changed for us now with the uh new administration uh public blockchain is now open uh to uh you know gibs and uh we're we're actively progressing down that road. You know, you'll probably have seen some announcements uh about city involved in various consortia related to stable coins that was in the media over the weekend and and last week. Um, you know, for us, we're we're always just trying to figure out and and we've spent a lot of money. Uh, my former colleague who was there recently, uh, Tony McLaclin, you know, he started a thing, the regulated liability network, which was saying that, you know, we have to figure out as incumbents, central banks, commercial banks, uh, and others, how digital assets become interoperable. and it hasn't happened at scale yet even though we've had Bank of International Settlements and other uh projects since then. Meanwhile, stable coins have come along and uh and kind of got some momentum uh you know which uh you know to complement Jeff's thing. Uh I I don't know how this arrived here but this is my recent uh stable coin report. Uh I I really don't know who put this here, but anyway, we we predict it going to maybe uh we said 3.7 trillion and Scott Bessant took that figure as well and and quoted it, but uh we updated it a few weeks ago to say maybe 4 trillion by 2030. But anyway, this isn't about who can who can say the biggest number. What we we do predict happens though is that we have um we have stable coins are certainly a thing. Uh we have tokenized bank deposits and other bank tokens we we predict will grow. I mean we're moving billions on a daily basis ourselves. JP Morgan uh they're another American bank if you haven't heard of them. They're also doing it. Uh and uh yeah there's there's lots happening in the space. So I think now with the new administration we certainly have uh the the the large institutions are here to uh not to play but to actually to uh to do stuff. So, it's uh it's kind of exciting. We'll definitely get into the regulatory conversation a little bit. Jeeoff, what about you? Is Standard Chartered thinking about DeFi in a similar way? We we've also been in this space for um quite a long time now. Excuse me. And and have been doing quite a lot of things. So, both in the mothership, if you like, and also via our SC ventures arm, uh where we've spun out a number of uh companies that you've probably heard of. So the the largest and most successful of those is Zodia markets and Zodia custody. They make markets in pretty much everything now in spot um out of the UK. They have custody businesses um so headed out of the UK but also also out of Ireland. Um we've had we have u also within SC Ventures spun out Liberia. So that's our sort of tokenization link if you like. And now in in the mothership we also make spot BTC ETH out of London out of Dubai. We have custody globally. We um have plans to roll out the spot business globally as well. So we we're the only GI now making markets in spot BTC E. There's a lot of uh regulatory clarity and other things that could assist us down the track, but it's fair to say we see this as transformational. And so we're trying to get ahead of each bucket as we can. Obviously in crypto markets, in stable coins, tokenized real world assets as well when we get some more clarity, pardon the pun, out of the US hopefully soon. um as well. So, lots of different fingers in lots of pies um and mostly trying to get ahead of what we see is very very likely in the um quite near-term to start transforming asset markets like FX where you can easily see 20 or 30% onchain in the next couple of years for example. So, trying to have quite a few of those where we're in line to have a Hong Kong dollar stable coin um as well. So, thinking about that avenue too. So, lots of different um areas just now. Paul, what do you see as some of the biggest real world use cases for banks? Well, I think that uh first of all, if you look back at and this David was talking about the transition from first just looking at this as a disruption versus I think now it's looked at as the technology of money, the technology of banking. And so I think from a you use case perspective when the when most of people end up using stable coins, they're not going to realize it's a stable coin. digital cash. Uh it's something that can be is is really transparent and another technology that under the hood you're maybe not aware of uh what's what's actually happening. Uh in our case like our our journey started with helping draft the second crypto banking law in the United States. Uh the first one was in the state of Wyoming and I think that charter was really focused on uh how do you disrupt how do we disrupt banking whereas we really made a concerted effort to cooperate with the Nebraska bankers and uh and and just in general look at it more of how how does a bank get into this? How do you see this as something that can actually go mainstream? And and and so that's kind of our focus and not really about viewing crypto as some value added service that can goes on that banks can get into, but actually as the future of the technology of banking. Eric, from an infrastructure perspective, what's the current ecosystem looking like? I mean, what are the pain points to to meet some of these use cases? Are we there yet? Um so certainly uh the base layer infrastructure is uh largely there. However um it's yet to be battle tested especially at the scale of adoption and also the scale of usage uh for a lot of the you know like uh bank use cases um to have the full-on global coverage. Um we're talking about basically you know injective being able to achieve like 10 or 20,000 uh uh TPS or trades per second and most of the you know high throughput blockchain roughly around the same range. Um some layer 2 solutions perhaps could s uh surpass it but we've all seen a lot of like stability related issues. So on the base layer um basically you know for for 99% of the uh traffic or like uh trading activity or any type of transaction activity or any type of financial activity it can certainly handle it but it might not be able to absorb you know the absolute uh peak control or like high traffic time or you know sudden spike in traffic um that you know most people are expecting on like a global scale. Um on the other hand, I think the general financial mechanism and also all the financial engineering that comes into DeFi and all the experimentation that goes into DeFi um has already taken um in such a mature shape at this point where largely you can find uh an equivalent uh type of like DeFi primitive uh or you know uh some some sort of like uh financial product that mirrors or behaves in a very similar way to any type of like traditional counterparts. Obviously, there's some exceptions to that currently with uh you know onchain options still being extremely limited due to the lack of uh you know margining uh systems that can go beyond uh um you know multiple like exchange venues or DEX venues. Um so so I think we're we're almost there. Um obviously you know uh uh the the technology or underlying infrastructure uh is evolving at a much higher speed than um the technological adoption curve for uh the larger institutions. So by the time you know um the activity or the uh the volume catches up to um fully migrating over onchain or fully uh uh kind of like being supported onchain uh the technology will be there to support it. David. Yeah. Yeah. Just on I mean it's an often it's it's a debate that often comes up and it's often like I lead our partnerships globally as well for digital assets and often when people are coming trying to sell solutions to the likes of city they like to quote you know the transactions per second and 5,000 6,000 20,000 we're working on 100,000 this year all of this type of stuff. to be honest more than 5,000 transactions per second is not really is not really necessary except in real edge cases. So I I think just as an example that I don't think the technology is the problem here. You know, I I think you'll agree from Telcoin perspective, you could provide technology uh and and and many of the providers here can provide the technology that would absolutely accommodate the scale uh for global financial market infrastructures. The thing that's kind of limiting is just the regulatory moves and really just collaboration around agreeing on who governs what. So we've had the you know we had a few different things that have successfully emerged as you know rules of the road for financial services. Swift is one. um you know often many people uh kind of point at swift and say ah it's just a messaging layer but it's something that everybody signs up to and yes the money moves on a different uh on a different uh manner um and and blockchain could bring the data the messaging uh the cash and the assets all together absolutely valid but at least they have a cooperative and rules of the road for how to move money euro is another one when Visa was formed in 1960 That was another one where people came together to do it. So really what I'm what I really feel is that it's not the technology that's a limiting factor. It's just the financial market infrastructures agreeing how to do things, how to agree for interoperability, how to agree agree for certain certain other other elements. That's the constraining factor for more traditional finance moving on chain. That would be my two cents anyway. Yeah, I agree. Agree. I mean, if you remember the dawn of the internet, um, everyone thought within two years we'd be on IPv6, if anyone remembers that. We're still on IPv4. So, I agree that it's not necessarily about the technology, but regulatory clarity that just sets the rules of the road. Jeeoff, do you agree? Yeah, I think that's right. Um, I think if we could get regulatory clarity in the US, um, obviously we need the US government to reopen. That would be a great start. um then clarity act passed then SEC guidelines let's say in the next three or four months that would be fantastic and then if we could also get clarity between regulations in different centers that would also be super helpful right so if we end up with different rules in the US than we have under Micah that would be problematic um etc so we need some interoperability between regulators will be also fantastic and then we also probably need tradfi just to accept the chain it's going to use the the rails it's going to use, etc. So, let's just assume that's Ethereum for for for a lot of Treadfi stuff. Um, even though we could debate the tech against some others, right? But let's just say it's Ethereum. And then you have an agreement that that's where a lot of this a lot of where this is going. You'll then get tokenized assets, etc. kind of start to build on top of that. But we're still in the early stages of each of those steps. So, it becomes quite tricky for organizations like banks that quite frankly are still somewhat conservative in in in the whole, right? So getting some agreement, regulators agree on where this is going, um I think will be fantastic. Yeah, the 3 weeks into the government shutdowns going very strong. I'm I'm not hearing very positive um reports from Washington. Um I guess David, you mentioned there's been a lot of regulatory progress recently, but there are still some pain points as Jeff mentioned. What do you see as the most pressing matter when it comes to policy? Um, I think there's I mean I I don't have a a favorite pain point in that in that space. I think maybe just to give something because I think Jeff and and others can speak more eloquently about about uh particular legislation, but I think the you know the change we've seen since the January 23rd executive order which signaled uh stable coins are something that the US really wants to push which inherently live on public chain and then uh you know CBDC's are something that you know the the exe ive order said was a threat to American sovereignty which I'm I'm gathering is largely negative towards it though English isn't my first language um the that public chain is something that's now open and then we've had genius and other stuff come to life um I think what's what's really the most complicated thing really in a in a big uh in big banks adopting this and and and Jeeoff, I I know the standard chartered, Zodia, Zodia markets and zodiac custody. It's been a brilliant strategy I think by standard charter to do that stuff in a separate kind of sister funded entity to do this because doing it in a very large entity is hard. But um which is why I look like I do when I'm really only 25. uh but uh essentially now we're all getting to do this in the large organizations but you still have your own internal and compliance in that and like to scale into multiple countries you still have to get the legal clarity and the regulatory clarity in all different countries so let's say today we're live in New York Singapore Hong Kong and and London with C token services and Dublin will come in a few few weeks time but like each other of the other 90 or so regulated places is where we're regulated. It each requires individual compliance. It's not like we just turn it on across the globe. So what what really needs to update more is internal processes for managing risk at scale in this area on a global level. And and I think with more regulatory clarity, it's you know, as as you'll hear in every conference, you know, more regulatory clarity is coming, so it's easier to turn on different locations, but it's still a lot of work and and the biggest barrier is, let's say, uh your own internal committees and compliance and convincing people that no, no, it's actually you're actually allowed to do this. Uh and getting people to turn up to those meetings and approve stuff. Yeah, that's the hard stuff. Yeah, I agree with that. It's it's still it remains very very difficult, right? Like the the regulatory response to to 2008 was to take anything non-standard and put it into basically force all of that out into non-bank banks, right? Um and now that what was in non-bank banks is now becoming so systemically important, i.e. stable coins and other payment rails type stuff that we're talking about. It needs to now circle back into back into the majors who are you know around trustworthy etc. regulated like regulators have oversight of what we do what city does. Um so the the the bigger powers like BIS for example still need to kind of step up and allow uh banks like ours to do what is what's required which is to make this new payments rail system more trustworthy. Yeah. So I think I think we will get there. Um it's taking time. It's taking education internally in organizations like ours as well. Right. So there's a lot of anchoring bias that remains. In 2022 we had very bad headlines um in this in this asset class. Right. So we need to still work on that education piece as well. I think even internally but again I think we're getting there and we're getting there quite quickly under this uh US administration. Paul, you have a lot of experience in the US both on the federal level and with state regulators. How are you thinking about the current environment? Well, it's obviously improved a lot. I mean, if a great thing in in the United States, we have this state system. There's the inter interstate banking law uh that's been around for a very long time that said that a Hawaii bank or Nebraska bank can operate with all of the powers of an OC federally chartered bank. And so I think a great thing that at least from our perspective happened with Genius is that it extended that interstate banking system to uh stable coins. Um I think it'll the next step is really seeing how this plays out in terms of rules. Treasury put out a request for uh for comment recently and and that's that's really where where it's key like how do you act how do you actually plug this into the legacy system? Um, the fact that you have these stable coins out there all backed by treasuries, I'm not sure that really makes a whole lot of sense. Um, if a bank can actually do this, can they use a sub account of their master account? Um, it it it would work a lot better, right? So, there's all sorts of of I think also in the BSA, bank secrecy act or anti-moneyaundering type regulation, there needs to be some upgrades there, too. So, that's that's the I think the next step is figuring out how does this really plug in and become uh properly operational or mainstream. I I want to shift gears a little bit. Um tokenization is such a big trend right now. Tokenized stocks, tokenized deposits. Eric, I want to start with you. Do you see tokenization as an inevitable next step for capital markets? Are we seeing a bit of a bubble? Is it a passing trend? What are what are you noticing? Yeah. So, if you ask me like uh two years ago uh or like a year ago, I would certainly say that um tokenization of uh a lot of these assets are certainly not um uh going to be as useful or going to be, you know, as well adopted as like uh the headlines are putting it out to be. Um basically, you know, just because you tokenize like a certain treasury node in like a permission setting or just because you tokenize like a certain like REIT fund or whatever. um um on like onchain setting suddenly it's going to just have like a completely new like life or uh basically get us you know complete new influx of buyers or volume etc. But um what what truly surprised me um uh was basically the success of Helix with the I asset which is basically like a virtualized um you know tokenization of a lot of like the equities private or public and the volume coming from those have just been you know absolutely humbling uh I think reaching up to like 8 to 10 billion at this point. Um so so I think in a general sense um there is some massive massive user base within the onchain community within the DeFi community that are looking to gain exposure to a lot of these assets. Obviously, you know, due to the current like uh uh regulatory like uncertainty and the lack of clarity on how to, you know, go about structuring these type of DeFi products, it's been highly challenging to you know, make it into like a full-on like once one representation of these like type of like onchain asset uh while allowing for like uh you know a more like public or less permission engagement. But I I do see like a significant promise here if there was a breath or like a critical mass of asset uh being issued uh being achieved instead of you know like oneoff like tokenization of like you know one particular fund that are extremely long horizon which we basically view it as kind of like a alternative uh rail or like alternative like settlement uh pipeline for like a traditional kind of like fundraising environment. David I I see you nodding. Do you agree? Oh yeah. Well, I think the I mean what I suppose I I live in the in the mainly in the tokenized kind of cash business and that so obviously I look at everything from with the bias towards that but I have seen you know in our security services division and investor services division you know the tokenization of funds and securities and that it's it's all coming but the interesting thing kind of like with you've probably all seen a lot of tokenized trade finance solutions down through the years and it was always systemizing paperbased processes like letters of credit or bills of exchange or something but the the problem with it was that the cash leg was not 24/7 as well. So now what we're we're doing with the investor and security services business is as they tokenize more um we can bring a cash leg that's 247 as well and then you get this delivery versus payment or atomic settlement uh which is really interesting that reduces risk and that is uh that is truly meaningful. So I think the two things coming together uh are what you need for real volumes uh to happen. So, um I think we're going to see a massive uh explosion in that and that tokenized cash rail could be stable coin uh if it's at a at a decent enough um uh if if you if you can get enough of them and there's enough of liquidity there. uh or it could be um tokenized cash uh and tokenized deposits like what like what we have um and yeah so I I think the two things will grow together but the appetite for and the efficiencies that we're seeing from doing this um the appetite is there the regulatory clarity is there the technology is there it's just about getting on and doing it now but I I think that link of cash plus asset coming together for delivery versus payment That's what I'm very excited about, Paul. Yeah. Yeah, I agree. I I think that it's very hard. So many people have come up with amazing ideas for all the applications of all this and it's going to be exciting to see them come to fruition, but it's very hard to deploy a lot of it without that bottom layer of the technology of money or tokenized cash or I mean, I don't really even like the word stable coin. I feel like that's a throwback to the unbanked crypto era where you had one asset that was engineered to represent or peg its value to an underlying asset. Whereas if a stable coin is issued by a bank, to me that's digital cash because legally that asset, you know, is a rep legal representation of the underlying asset. You can trust that's the way reason why banks are a liability of a bank is exempt from securities law, right? Um, so that's key that you have that kind of certainty at the bottom layer. There's so many exciting things you can build on top. I agree. Um, I think I think it's going to be massive actually. Um, and I'll probably go even slightly further than than the other guys. I think we have now the tokenized cash version. Call it what you like. Um, we have the tokenized money market fund stuff. We have each of these weekend liquid now. We have a large push now ready into tokenized equities. we will get clarity act sec guidelines we'll work out what we can do in defi what's legitimate what can scale in defi and I think this is all like in the next six to9 months actually um and so I think if we today have something like $30 billion in tokenized realwood assets um outstanding in 12 months we're going to be at like 300 billion so I think you're just at that acceleration point where regulation liquidity and others can come together and we can move very very quickly. So it's equities now it will be tokenized broader funds at some stage like when I talk to the real money accounts at some stage next year one of the main ones that possibly starts with B is going to say okay here's like $50 billion fund which is now all in tokenized space and when after that you'll get all the FOMO from all the others doing exactly the same right so we're just now at that tipping point in tokenized railway asset space and the average person will end up with a new wallet in their phone they won't know the cash part is stable coins. They won't know the equity part is tokenized Apple stock. They won't know the money market fund is with Bidd, right? So um and because of AI agents next year when everyone has that as well every time you get paid every month an individual will be able to be super capital efficient, right? So money comes in and goes out immediately to each of these assets and you can get in and out of them on weekends. You can do stuff in DeFi with them to get extra leverage as well. So, I think we're just we're just there now um at this explosion. So, actually for me, if 2025 has been about stable coins, 2026 might be all about this um quite seriously. Eric, I see you nodding. Do you agree? Yeah, I I I think I have like a kind of like a relatively like a pessimistic view about uh you know, kind of like currently what the stable coin industry is like shaping up or like where a lot of these product innovations are gearing towards. And what I you know hope for the space to have is exactly what you guys talk about which is um basically like a digital cash like a tokenized cash instead of like a credit representation of like actively managed you know treasury strategy or even like hedge fun strategy etc which has been you know highly successful but at the same time we don't need uh 20 or like 50 of these um and I think this is truly where the space should be going and this is you know what's like a big missing piece in the industry at the moment I guess looking ahead do you see stable coins as more of a back end financial infrastructure tool or will it be like consumer payments method or yeah payments? Um I I think that really goes into um both I guess a whole host of like regulation when it comes to you know like uh uh payment laws etc. Uh especially when it comes to peer-to-peer payments that I know um you know like PayPal structure in the way that it is, FEMO is structured in the way that it is. Same reason why like Cash App is getting a lot of smack for the way that it is. Um so so it's very hard for me to imagine or like envision uh a world where uh there's you know uh hyper like critical mass adoption of stable coin um you know at the current shape and form um uh that's used for like you know peer-to-peer payment uh uh or you know any type of like other usages um in in the form that you know like billions of people like use it uh at the current day without any type of like update in terms of regulation or without any type of like clarity in terms of like how uh the payment space will evolve. I think it I mean I think it depends where you are. So um obviously our bank is footprint markets in EM in Asia, Africa, Middle East, right? And I mean this is happening already. So the so for me it depends on how strong the demand is in EM the demand is strong because um the the broader need is there like you know you have 1.7 billion remain unbanked today. So they're starting to use payments rails via stable coins. um the demand to have savings accounts in dollarbased bank accounts which is effective lot stables are as well is massive in EM so it's sort of starting in EM it then will circle back I think in developed markets I have a lot of conversations with corporate treasurers now Midwest US corporates that are saying hey Jeff we've heard of stables what are they how do we use them how can this make us more capital efficient and so it'll sort of circle back like in the same way in this country when you first use WhatsApp yourself in your phone used to text your friends in other countries because it's free and now you only ever use WhatsApp, right? So, I think you see something similar happen with payments rails on the back of stables. Yeah, I think Jeff makes a great point. If you I think the largest outbound remittance corridor from Europe is Germany to Turkey, but if you go into the World Bank's website right now, it's completely gone. Like everybody 90% of that corridor has moved over informally to uh to to stable coins. So, but but I don't think that at least in developed markets, do consumers really want to hold 15 different branded stable coins? Probably not. Uh there's definitely a use case. It's a lot better than a uh say a gift card for Amazon or So, it's a great way for I think companies to keep uh uh money within their balance sheet or in their ecosystem. Um but yeah, I I I feel that consumers are going to want more. They want to use digital dollars or digital uh R&B or whatever. Um, yeah. I think maybe to just a a few things that uh I just have to get off my chest and I'm going to do it to you because uh my counselor doesn't want to hear about this stuff. Um, so Jeff's statistics are brilliant. I use them myself when I'm looking for more funding. Probably everybody else here uses them in their decks. Yeah. And thank you. Uh I even use some of some of our own that uh my my colleague Ronnet go and the team do but but it's always better to have a third party one and yours are brilliant. Uh so um so I use them for that. What I do find is that we lump together the retail use of stable coins and the commercial and the potential for institutions and commercial organizations to use stable coins. um that hasn't happened to the degree we've ex we we might expect as yet because the incentives are slightly different for different folks to to use these things. So if you're in a high inflation economy uh Turkey, Egypt, Nigeria, um you want to get out of your local currency into a more stable thing and if you can get access to dollars, you'll do it. If you can get digital dollars, that's easier. Great. If they start paying you yield on top of that, that's an extra bonus as well. And then you get used to using that. If you're a large global multinational who has a daily overdraft limit with us of $2 billion and has people around the world who are uh who are managing their treasury and who are less likely to be left unpaid by their by their clients, you have a different set of incentives. So, so you're not under as much pressure as anme who, let's say, uh, doesn't get paid by somebody and needs to find a way of moving money from Hong Kong uh, to to London or vice versa and they will go to the trouble of opening up a a wallet and using a stable coin and things like that. So the incentives are have been that have led to the growth have been for for ease of crossber payments and to to get something as away from the inflation that was hurting you as an individual. But now as more and more people see the efficiencies that are there, we'll see more corporates use it. we'll see other people uh provide the um the capabilities to abstract away the complexity of of using this technology for their clients and we'll see more of that grow but we'll also see banks uh provide uh solutions that take away the complexity as well like like we've done um so I just think that the the figures that we talk about we need to kind of not assume that the corporate use of stable coins is going to go at the same trajectory but It's going to be a process, but it at the end of the day, nobody ever woke up and said, "I'd like to make a blockchain based payable today." Except us uh in here, right? But but if we if we make things easier to do 247 for folks, they'll do it and it it'll grow. Anyway, definitely a space to watch. It's a great note to end on. Unfortunately, we're out of time, but thank you all so much and thank you all for joining us.
Banking Meets DeFi: The Great Financial Convergence | DAS London 2025 | Day 2 | Institutional
Summary
Transcript
Hello. Um, very excited to talk about banking and DeFi with some banks and DeFi professionals. Um, let's start with a quick intro. David, did you want to kick us off? Sure. Uh, I'm Dave Cunningham. I lead strategy and partnerships for digital assets at City. It's an American startup bank uh, scaling uh, internationally. Uh, we're trying to do our best. Uh, but yeah, it's going going pretty well. Paul. Hi, I'm Paul Nuner. I'm the uh founder and CEO of Telcoin. So, we are a conditionally approved digital asset depository institution in the state of Nebraska, but also able to take nationwide clients. Um, we are planning to launch in December. U, it's been a long road. We started in 2017, so we're on year 8 already, and we're finally opening things up. Um, but we're also the first, uh, bank charter that is explicitly authorized to connect US consumers with DeFi. So very happy to be on this panel and appreciate the invitation. Jeff. Hi, I'm Jeff Kendrick. I run digital asset research for Standard Charted Bank. Uh people pretty much know my research for one of either two things. So I write research on public coins and tokens. Uh for example, in April 2023, Bitcoin was 25K. I predicted a move to 100K by the end of last year, which thankfully worked out quite nicely. um or on stable coins uh where Scott Bessant uses my $ two trillion dollar number um in Congress today. As far as I'm aware, I remain the only person in any bank globally doing this job full-time. So, I I just have to say monopolies are good when you're in the center of one. Hey, I'm Eric, uh co-founder and CEO of Injective Labs. Um and I'm currently CEO of Injective Foundation. Uh so Injective is a highly performant blockchain built for financial applications. Um it's been you know one of the top blockchains in the space uh specifically tailored towards uh advanced trading advanced financial inhstruments. Thank you. Uh so this panel is called banking meets DeFi. I want to start with the banks. David maybe you can kick us off first. How are you all thinking about DeFi? How has it changed in recent years? What kind of use cases? Tell us about your team. Um so essentially for us I mean city's been building and experimenting with blockchain since about 2014 or so. I joined in three years ago and uh uh essentially we didn't do a lot for a long time that that made it live. Uh in fact, you know, I I joined to lead our strategy and figure out, you know, what could we do to use this technology to help what we do today, which is move about $5 trillion a day in in my division. Um so where can this help? And there's kind of that dilemma, you know, are you trying to disrupt yourself or what are you trying to do? Essentially, uh the consensus reached was we're not trying to disrupt ourselves. were just trying to improve things and take advantage of what we have today and augment it with other capabilities. So uh thankfully we set about building something and we got city token services live as a as a solution uh which is was during the harder days of the previous US administration when um yeah you had to get things like a non-objection uh 1179 for to do anything or even to change slightly what you've you've already been talking about for years. So um yeah we we have something which we built which moves the dollar 24/7 uh cross border for our clients um and is going pretty well. But I think everything has changed for us now with the uh new administration uh public blockchain is now open uh to uh you know gibs and uh we're we're actively progressing down that road. You know, you'll probably have seen some announcements uh about city involved in various consortia related to stable coins that was in the media over the weekend and and last week. Um, you know, for us, we're we're always just trying to figure out and and we've spent a lot of money. Uh, my former colleague who was there recently, uh, Tony McLaclin, you know, he started a thing, the regulated liability network, which was saying that, you know, we have to figure out as incumbents, central banks, commercial banks, uh, and others, how digital assets become interoperable. and it hasn't happened at scale yet even though we've had Bank of International Settlements and other uh projects since then. Meanwhile, stable coins have come along and uh and kind of got some momentum uh you know which uh you know to complement Jeff's thing. Uh I I don't know how this arrived here but this is my recent uh stable coin report. Uh I I really don't know who put this here, but anyway, we we predict it going to maybe uh we said 3.7 trillion and Scott Bessant took that figure as well and and quoted it, but uh we updated it a few weeks ago to say maybe 4 trillion by 2030. But anyway, this isn't about who can who can say the biggest number. What we we do predict happens though is that we have um we have stable coins are certainly a thing. Uh we have tokenized bank deposits and other bank tokens we we predict will grow. I mean we're moving billions on a daily basis ourselves. JP Morgan uh they're another American bank if you haven't heard of them. They're also doing it. Uh and uh yeah there's there's lots happening in the space. So I think now with the new administration we certainly have uh the the the large institutions are here to uh not to play but to actually to uh to do stuff. So, it's uh it's kind of exciting. We'll definitely get into the regulatory conversation a little bit. Jeeoff, what about you? Is Standard Chartered thinking about DeFi in a similar way? We we've also been in this space for um quite a long time now. Excuse me. And and have been doing quite a lot of things. So, both in the mothership, if you like, and also via our SC ventures arm, uh where we've spun out a number of uh companies that you've probably heard of. So the the largest and most successful of those is Zodia markets and Zodia custody. They make markets in pretty much everything now in spot um out of the UK. They have custody businesses um so headed out of the UK but also also out of Ireland. Um we've had we have u also within SC Ventures spun out Liberia. So that's our sort of tokenization link if you like. And now in in the mothership we also make spot BTC ETH out of London out of Dubai. We have custody globally. We um have plans to roll out the spot business globally as well. So we we're the only GI now making markets in spot BTC E. There's a lot of uh regulatory clarity and other things that could assist us down the track, but it's fair to say we see this as transformational. And so we're trying to get ahead of each bucket as we can. Obviously in crypto markets, in stable coins, tokenized real world assets as well when we get some more clarity, pardon the pun, out of the US hopefully soon. um as well. So, lots of different fingers in lots of pies um and mostly trying to get ahead of what we see is very very likely in the um quite near-term to start transforming asset markets like FX where you can easily see 20 or 30% onchain in the next couple of years for example. So, trying to have quite a few of those where we're in line to have a Hong Kong dollar stable coin um as well. So, thinking about that avenue too. So, lots of different um areas just now. Paul, what do you see as some of the biggest real world use cases for banks? Well, I think that uh first of all, if you look back at and this David was talking about the transition from first just looking at this as a disruption versus I think now it's looked at as the technology of money, the technology of banking. And so I think from a you use case perspective when the when most of people end up using stable coins, they're not going to realize it's a stable coin. digital cash. Uh it's something that can be is is really transparent and another technology that under the hood you're maybe not aware of uh what's what's actually happening. Uh in our case like our our journey started with helping draft the second crypto banking law in the United States. Uh the first one was in the state of Wyoming and I think that charter was really focused on uh how do you disrupt how do we disrupt banking whereas we really made a concerted effort to cooperate with the Nebraska bankers and uh and and just in general look at it more of how how does a bank get into this? How do you see this as something that can actually go mainstream? And and and so that's kind of our focus and not really about viewing crypto as some value added service that can goes on that banks can get into, but actually as the future of the technology of banking. Eric, from an infrastructure perspective, what's the current ecosystem looking like? I mean, what are the pain points to to meet some of these use cases? Are we there yet? Um so certainly uh the base layer infrastructure is uh largely there. However um it's yet to be battle tested especially at the scale of adoption and also the scale of usage uh for a lot of the you know like uh bank use cases um to have the full-on global coverage. Um we're talking about basically you know injective being able to achieve like 10 or 20,000 uh uh TPS or trades per second and most of the you know high throughput blockchain roughly around the same range. Um some layer 2 solutions perhaps could s uh surpass it but we've all seen a lot of like stability related issues. So on the base layer um basically you know for for 99% of the uh traffic or like uh trading activity or any type of transaction activity or any type of financial activity it can certainly handle it but it might not be able to absorb you know the absolute uh peak control or like high traffic time or you know sudden spike in traffic um that you know most people are expecting on like a global scale. Um on the other hand, I think the general financial mechanism and also all the financial engineering that comes into DeFi and all the experimentation that goes into DeFi um has already taken um in such a mature shape at this point where largely you can find uh an equivalent uh type of like DeFi primitive uh or you know uh some some sort of like uh financial product that mirrors or behaves in a very similar way to any type of like traditional counterparts. Obviously, there's some exceptions to that currently with uh you know onchain options still being extremely limited due to the lack of uh you know margining uh systems that can go beyond uh um you know multiple like exchange venues or DEX venues. Um so so I think we're we're almost there. Um obviously you know uh uh the the technology or underlying infrastructure uh is evolving at a much higher speed than um the technological adoption curve for uh the larger institutions. So by the time you know um the activity or the uh the volume catches up to um fully migrating over onchain or fully uh uh kind of like being supported onchain uh the technology will be there to support it. David. Yeah. Yeah. Just on I mean it's an often it's it's a debate that often comes up and it's often like I lead our partnerships globally as well for digital assets and often when people are coming trying to sell solutions to the likes of city they like to quote you know the transactions per second and 5,000 6,000 20,000 we're working on 100,000 this year all of this type of stuff. to be honest more than 5,000 transactions per second is not really is not really necessary except in real edge cases. So I I think just as an example that I don't think the technology is the problem here. You know, I I think you'll agree from Telcoin perspective, you could provide technology uh and and and many of the providers here can provide the technology that would absolutely accommodate the scale uh for global financial market infrastructures. The thing that's kind of limiting is just the regulatory moves and really just collaboration around agreeing on who governs what. So we've had the you know we had a few different things that have successfully emerged as you know rules of the road for financial services. Swift is one. um you know often many people uh kind of point at swift and say ah it's just a messaging layer but it's something that everybody signs up to and yes the money moves on a different uh on a different uh manner um and and blockchain could bring the data the messaging uh the cash and the assets all together absolutely valid but at least they have a cooperative and rules of the road for how to move money euro is another one when Visa was formed in 1960 That was another one where people came together to do it. So really what I'm what I really feel is that it's not the technology that's a limiting factor. It's just the financial market infrastructures agreeing how to do things, how to agree for interoperability, how to agree agree for certain certain other other elements. That's the constraining factor for more traditional finance moving on chain. That would be my two cents anyway. Yeah, I agree. Agree. I mean, if you remember the dawn of the internet, um, everyone thought within two years we'd be on IPv6, if anyone remembers that. We're still on IPv4. So, I agree that it's not necessarily about the technology, but regulatory clarity that just sets the rules of the road. Jeeoff, do you agree? Yeah, I think that's right. Um, I think if we could get regulatory clarity in the US, um, obviously we need the US government to reopen. That would be a great start. um then clarity act passed then SEC guidelines let's say in the next three or four months that would be fantastic and then if we could also get clarity between regulations in different centers that would also be super helpful right so if we end up with different rules in the US than we have under Micah that would be problematic um etc so we need some interoperability between regulators will be also fantastic and then we also probably need tradfi just to accept the chain it's going to use the the rails it's going to use, etc. So, let's just assume that's Ethereum for for for a lot of Treadfi stuff. Um, even though we could debate the tech against some others, right? But let's just say it's Ethereum. And then you have an agreement that that's where a lot of this a lot of where this is going. You'll then get tokenized assets, etc. kind of start to build on top of that. But we're still in the early stages of each of those steps. So, it becomes quite tricky for organizations like banks that quite frankly are still somewhat conservative in in in the whole, right? So getting some agreement, regulators agree on where this is going, um I think will be fantastic. Yeah, the 3 weeks into the government shutdowns going very strong. I'm I'm not hearing very positive um reports from Washington. Um I guess David, you mentioned there's been a lot of regulatory progress recently, but there are still some pain points as Jeff mentioned. What do you see as the most pressing matter when it comes to policy? Um, I think there's I mean I I don't have a a favorite pain point in that in that space. I think maybe just to give something because I think Jeff and and others can speak more eloquently about about uh particular legislation, but I think the you know the change we've seen since the January 23rd executive order which signaled uh stable coins are something that the US really wants to push which inherently live on public chain and then uh you know CBDC's are something that you know the the exe ive order said was a threat to American sovereignty which I'm I'm gathering is largely negative towards it though English isn't my first language um the that public chain is something that's now open and then we've had genius and other stuff come to life um I think what's what's really the most complicated thing really in a in a big uh in big banks adopting this and and and Jeeoff, I I know the standard chartered, Zodia, Zodia markets and zodiac custody. It's been a brilliant strategy I think by standard charter to do that stuff in a separate kind of sister funded entity to do this because doing it in a very large entity is hard. But um which is why I look like I do when I'm really only 25. uh but uh essentially now we're all getting to do this in the large organizations but you still have your own internal and compliance in that and like to scale into multiple countries you still have to get the legal clarity and the regulatory clarity in all different countries so let's say today we're live in New York Singapore Hong Kong and and London with C token services and Dublin will come in a few few weeks time but like each other of the other 90 or so regulated places is where we're regulated. It each requires individual compliance. It's not like we just turn it on across the globe. So what what really needs to update more is internal processes for managing risk at scale in this area on a global level. And and I think with more regulatory clarity, it's you know, as as you'll hear in every conference, you know, more regulatory clarity is coming, so it's easier to turn on different locations, but it's still a lot of work and and the biggest barrier is, let's say, uh your own internal committees and compliance and convincing people that no, no, it's actually you're actually allowed to do this. Uh and getting people to turn up to those meetings and approve stuff. Yeah, that's the hard stuff. Yeah, I agree with that. It's it's still it remains very very difficult, right? Like the the regulatory response to to 2008 was to take anything non-standard and put it into basically force all of that out into non-bank banks, right? Um and now that what was in non-bank banks is now becoming so systemically important, i.e. stable coins and other payment rails type stuff that we're talking about. It needs to now circle back into back into the majors who are you know around trustworthy etc. regulated like regulators have oversight of what we do what city does. Um so the the the bigger powers like BIS for example still need to kind of step up and allow uh banks like ours to do what is what's required which is to make this new payments rail system more trustworthy. Yeah. So I think I think we will get there. Um it's taking time. It's taking education internally in organizations like ours as well. Right. So there's a lot of anchoring bias that remains. In 2022 we had very bad headlines um in this in this asset class. Right. So we need to still work on that education piece as well. I think even internally but again I think we're getting there and we're getting there quite quickly under this uh US administration. Paul, you have a lot of experience in the US both on the federal level and with state regulators. How are you thinking about the current environment? Well, it's obviously improved a lot. I mean, if a great thing in in the United States, we have this state system. There's the inter interstate banking law uh that's been around for a very long time that said that a Hawaii bank or Nebraska bank can operate with all of the powers of an OC federally chartered bank. And so I think a great thing that at least from our perspective happened with Genius is that it extended that interstate banking system to uh stable coins. Um I think it'll the next step is really seeing how this plays out in terms of rules. Treasury put out a request for uh for comment recently and and that's that's really where where it's key like how do you act how do you actually plug this into the legacy system? Um, the fact that you have these stable coins out there all backed by treasuries, I'm not sure that really makes a whole lot of sense. Um, if a bank can actually do this, can they use a sub account of their master account? Um, it it it would work a lot better, right? So, there's all sorts of of I think also in the BSA, bank secrecy act or anti-moneyaundering type regulation, there needs to be some upgrades there, too. So, that's that's the I think the next step is figuring out how does this really plug in and become uh properly operational or mainstream. I I want to shift gears a little bit. Um tokenization is such a big trend right now. Tokenized stocks, tokenized deposits. Eric, I want to start with you. Do you see tokenization as an inevitable next step for capital markets? Are we seeing a bit of a bubble? Is it a passing trend? What are what are you noticing? Yeah. So, if you ask me like uh two years ago uh or like a year ago, I would certainly say that um tokenization of uh a lot of these assets are certainly not um uh going to be as useful or going to be, you know, as well adopted as like uh the headlines are putting it out to be. Um basically, you know, just because you tokenize like a certain treasury node in like a permission setting or just because you tokenize like a certain like REIT fund or whatever. um um on like onchain setting suddenly it's going to just have like a completely new like life or uh basically get us you know complete new influx of buyers or volume etc. But um what what truly surprised me um uh was basically the success of Helix with the I asset which is basically like a virtualized um you know tokenization of a lot of like the equities private or public and the volume coming from those have just been you know absolutely humbling uh I think reaching up to like 8 to 10 billion at this point. Um so so I think in a general sense um there is some massive massive user base within the onchain community within the DeFi community that are looking to gain exposure to a lot of these assets. Obviously, you know, due to the current like uh uh regulatory like uncertainty and the lack of clarity on how to, you know, go about structuring these type of DeFi products, it's been highly challenging to you know, make it into like a full-on like once one representation of these like type of like onchain asset uh while allowing for like uh you know a more like public or less permission engagement. But I I do see like a significant promise here if there was a breath or like a critical mass of asset uh being issued uh being achieved instead of you know like oneoff like tokenization of like you know one particular fund that are extremely long horizon which we basically view it as kind of like a alternative uh rail or like alternative like settlement uh pipeline for like a traditional kind of like fundraising environment. David I I see you nodding. Do you agree? Oh yeah. Well, I think the I mean what I suppose I I live in the in the mainly in the tokenized kind of cash business and that so obviously I look at everything from with the bias towards that but I have seen you know in our security services division and investor services division you know the tokenization of funds and securities and that it's it's all coming but the interesting thing kind of like with you've probably all seen a lot of tokenized trade finance solutions down through the years and it was always systemizing paperbased processes like letters of credit or bills of exchange or something but the the problem with it was that the cash leg was not 24/7 as well. So now what we're we're doing with the investor and security services business is as they tokenize more um we can bring a cash leg that's 247 as well and then you get this delivery versus payment or atomic settlement uh which is really interesting that reduces risk and that is uh that is truly meaningful. So I think the two things coming together uh are what you need for real volumes uh to happen. So, um I think we're going to see a massive uh explosion in that and that tokenized cash rail could be stable coin uh if it's at a at a decent enough um uh if if you if you can get enough of them and there's enough of liquidity there. uh or it could be um tokenized cash uh and tokenized deposits like what like what we have um and yeah so I I think the two things will grow together but the appetite for and the efficiencies that we're seeing from doing this um the appetite is there the regulatory clarity is there the technology is there it's just about getting on and doing it now but I I think that link of cash plus asset coming together for delivery versus payment That's what I'm very excited about, Paul. Yeah. Yeah, I agree. I I think that it's very hard. So many people have come up with amazing ideas for all the applications of all this and it's going to be exciting to see them come to fruition, but it's very hard to deploy a lot of it without that bottom layer of the technology of money or tokenized cash or I mean, I don't really even like the word stable coin. I feel like that's a throwback to the unbanked crypto era where you had one asset that was engineered to represent or peg its value to an underlying asset. Whereas if a stable coin is issued by a bank, to me that's digital cash because legally that asset, you know, is a rep legal representation of the underlying asset. You can trust that's the way reason why banks are a liability of a bank is exempt from securities law, right? Um, so that's key that you have that kind of certainty at the bottom layer. There's so many exciting things you can build on top. I agree. Um, I think I think it's going to be massive actually. Um, and I'll probably go even slightly further than than the other guys. I think we have now the tokenized cash version. Call it what you like. Um, we have the tokenized money market fund stuff. We have each of these weekend liquid now. We have a large push now ready into tokenized equities. we will get clarity act sec guidelines we'll work out what we can do in defi what's legitimate what can scale in defi and I think this is all like in the next six to9 months actually um and so I think if we today have something like $30 billion in tokenized realwood assets um outstanding in 12 months we're going to be at like 300 billion so I think you're just at that acceleration point where regulation liquidity and others can come together and we can move very very quickly. So it's equities now it will be tokenized broader funds at some stage like when I talk to the real money accounts at some stage next year one of the main ones that possibly starts with B is going to say okay here's like $50 billion fund which is now all in tokenized space and when after that you'll get all the FOMO from all the others doing exactly the same right so we're just now at that tipping point in tokenized railway asset space and the average person will end up with a new wallet in their phone they won't know the cash part is stable coins. They won't know the equity part is tokenized Apple stock. They won't know the money market fund is with Bidd, right? So um and because of AI agents next year when everyone has that as well every time you get paid every month an individual will be able to be super capital efficient, right? So money comes in and goes out immediately to each of these assets and you can get in and out of them on weekends. You can do stuff in DeFi with them to get extra leverage as well. So, I think we're just we're just there now um at this explosion. So, actually for me, if 2025 has been about stable coins, 2026 might be all about this um quite seriously. Eric, I see you nodding. Do you agree? Yeah, I I I think I have like a kind of like a relatively like a pessimistic view about uh you know, kind of like currently what the stable coin industry is like shaping up or like where a lot of these product innovations are gearing towards. And what I you know hope for the space to have is exactly what you guys talk about which is um basically like a digital cash like a tokenized cash instead of like a credit representation of like actively managed you know treasury strategy or even like hedge fun strategy etc which has been you know highly successful but at the same time we don't need uh 20 or like 50 of these um and I think this is truly where the space should be going and this is you know what's like a big missing piece in the industry at the moment I guess looking ahead do you see stable coins as more of a back end financial infrastructure tool or will it be like consumer payments method or yeah payments? Um I I think that really goes into um both I guess a whole host of like regulation when it comes to you know like uh uh payment laws etc. Uh especially when it comes to peer-to-peer payments that I know um you know like PayPal structure in the way that it is, FEMO is structured in the way that it is. Same reason why like Cash App is getting a lot of smack for the way that it is. Um so so it's very hard for me to imagine or like envision uh a world where uh there's you know uh hyper like critical mass adoption of stable coin um you know at the current shape and form um uh that's used for like you know peer-to-peer payment uh uh or you know any type of like other usages um in in the form that you know like billions of people like use it uh at the current day without any type of like update in terms of regulation or without any type of like clarity in terms of like how uh the payment space will evolve. I think it I mean I think it depends where you are. So um obviously our bank is footprint markets in EM in Asia, Africa, Middle East, right? And I mean this is happening already. So the so for me it depends on how strong the demand is in EM the demand is strong because um the the broader need is there like you know you have 1.7 billion remain unbanked today. So they're starting to use payments rails via stable coins. um the demand to have savings accounts in dollarbased bank accounts which is effective lot stables are as well is massive in EM so it's sort of starting in EM it then will circle back I think in developed markets I have a lot of conversations with corporate treasurers now Midwest US corporates that are saying hey Jeff we've heard of stables what are they how do we use them how can this make us more capital efficient and so it'll sort of circle back like in the same way in this country when you first use WhatsApp yourself in your phone used to text your friends in other countries because it's free and now you only ever use WhatsApp, right? So, I think you see something similar happen with payments rails on the back of stables. Yeah, I think Jeff makes a great point. If you I think the largest outbound remittance corridor from Europe is Germany to Turkey, but if you go into the World Bank's website right now, it's completely gone. Like everybody 90% of that corridor has moved over informally to uh to to stable coins. So, but but I don't think that at least in developed markets, do consumers really want to hold 15 different branded stable coins? Probably not. Uh there's definitely a use case. It's a lot better than a uh say a gift card for Amazon or So, it's a great way for I think companies to keep uh uh money within their balance sheet or in their ecosystem. Um but yeah, I I I feel that consumers are going to want more. They want to use digital dollars or digital uh R&B or whatever. Um, yeah. I think maybe to just a a few things that uh I just have to get off my chest and I'm going to do it to you because uh my counselor doesn't want to hear about this stuff. Um, so Jeff's statistics are brilliant. I use them myself when I'm looking for more funding. Probably everybody else here uses them in their decks. Yeah. And thank you. Uh I even use some of some of our own that uh my my colleague Ronnet go and the team do but but it's always better to have a third party one and yours are brilliant. Uh so um so I use them for that. What I do find is that we lump together the retail use of stable coins and the commercial and the potential for institutions and commercial organizations to use stable coins. um that hasn't happened to the degree we've ex we we might expect as yet because the incentives are slightly different for different folks to to use these things. So if you're in a high inflation economy uh Turkey, Egypt, Nigeria, um you want to get out of your local currency into a more stable thing and if you can get access to dollars, you'll do it. If you can get digital dollars, that's easier. Great. If they start paying you yield on top of that, that's an extra bonus as well. And then you get used to using that. If you're a large global multinational who has a daily overdraft limit with us of $2 billion and has people around the world who are uh who are managing their treasury and who are less likely to be left unpaid by their by their clients, you have a different set of incentives. So, so you're not under as much pressure as anme who, let's say, uh, doesn't get paid by somebody and needs to find a way of moving money from Hong Kong uh, to to London or vice versa and they will go to the trouble of opening up a a wallet and using a stable coin and things like that. So the incentives are have been that have led to the growth have been for for ease of crossber payments and to to get something as away from the inflation that was hurting you as an individual. But now as more and more people see the efficiencies that are there, we'll see more corporates use it. we'll see other people uh provide the um the capabilities to abstract away the complexity of of using this technology for their clients and we'll see more of that grow but we'll also see banks uh provide uh solutions that take away the complexity as well like like we've done um so I just think that the the figures that we talk about we need to kind of not assume that the corporate use of stable coins is going to go at the same trajectory but It's going to be a process, but it at the end of the day, nobody ever woke up and said, "I'd like to make a blockchain based payable today." Except us uh in here, right? But but if we if we make things easier to do 247 for folks, they'll do it and it it'll grow. Anyway, definitely a space to watch. It's a great note to end on. Unfortunately, we're out of time, but thank you all so much and thank you all for joining us.