Flash Talk by Michael Kwan - DeFi Lead + Strategic Initiative Partner, Celo Foundation

My name is Michael. I lead DeFi growth at the Cello Foundation as well as serve as a community contributor for the Stabilo Foundation. For today's talk, wanted to walk through how Stabilo's effort has been really focused on accelerating the stable coin driven DeFi flywheel on Cello. Stabil has been doing a great job on stitching incentives, liquidity, as well as DeFi ecosystem use cases to really get that flywheel spinning. For folks who aren't familiar, Cello is an Ethereum L2 built for real world use cases, facilitating fast, lowcost payments worldwide.

And Stabilla is a community funded initiative on Cello focused on stable coin adoption as well as powering the core cell defy flywheel via incentives displaced on various protocols across the D5 ecosystem. Now over the past year in terms of what we've built, Stabil has been really focused on building very strong deep stable coin DEX liquidity. We have over 25 native stable coins on Cello including native USDT and USDC as well as local stable coins as well which includes Kenyon Chilling, Colombian Peso and many more. And for every stable coin that launches on Cello, stable, Stabila has made an effort to make sure that it has deep stable coin to stable coin DEX liquidity. And so far they have incentivized over 30 stable to coin to stable coin incentivized DEX pools.

And this has made an effort in creating very deep concentrated and and uh liquid depth for these DEX liquidities dexi liquidity pools. So much so that if you look at our monthly volume so far in October, $2.5 billion of monthly volumes were facilitated and part of it is towards folks tapping into it into the dexi liquidity for payment transactions but also folks are oh what's going on here? Oh, I think we lost our slides. So that $2.

5 billion uh monthly trading volume, that deep dex liquidity, part of it is being tapped into for payment transactions, but also folks who are attracting, we're attracting also FX arbitrage traders who are looking into our essentially FX onchain markets and arbitrage trading across these stable coin pairs. And we're starting to see this also roll up in our DAUs. Excitingly enough, over 772,000 daily active users, I believe 790K over the last couple of days. This is actually placing Cello as the number one L2 on Ethereum in terms of DAUs. And the magic in terms of the back end is pretty simple.

And what Stabila does, Stabila first partners with stablecoin issuers to onboard onto onto the Cello ecosystem, helps them get them visil visibility initially by having the seeding of initial dexi liquidity and then stabil then layers on an incentive layer to ensure that there's concentric concentrated liquidity on those DEX pools. Furthermore, in including arbitrage loops to just ensure that the pricing of that stable coin is efficient on the DEX. And then gradually on the last step once the TVO of that DEX pool for that stable coin grows sufficiently enough we plug them in into further ecosystem use cases right two ecosystem use cases and distribution channels I want to highlight here firstly opera minipay that's an exclusive partnership with the opera browser they have embedded a stable coin wallet into the browser in Africa alone they have 100 million monthly average users so folks who are browsing the web can also send and receive stable coins to their friends and family and within that mini app stable coin wallet they also have a mini app ecosystem so it further extends the use case of stable coins allowing people to pay for utility bills groceries to subscribing to their favorite favorite music streaming platforms and the other flip side uh of another distribution channel I wanted to highlight is one that's uh recently launched a couple weeks ago EY the professional service firm just deployed their layer 3 uh privacy layer on Cello facilitating B2B payment payments. So, we're very much working closely with the EY team to activate more enterprise B2B payment flows using the existing stable coin tech stack that's available on our chain. So, in terms of what's next steps are looking like for Stabila and the road map, we already developed, you know, deep stablecoin dex liquidity.

So, the next obvious layer to really build upon is building out lending per and furthermore looping opportunities, right? And so as of today over the last uh three or four months since a has been deployed on Cello we have been uh Stabil has been in particular scaling up that liquidity from that initial $2 million of market size to over $30 million. And this serves as the core liquidity backbone for our upcoming per decks as well as prediction markets that's coming to launch in the coming months. So December that's when we're targeting our perpetual exchange launch. They will of course accept collateral of stable coins and will be uniquely positioned to have very uh differentiated emerging market FX pairs uh to attract traders across our chain never before seen in other perpetual exchanges.

And then the following subsequent month is where we'll have also a prediction market. This is serving you know as an an alternative to a different audience who's looking more for like a lightweight alternative instead of you know hardcore trading. And nevertheless, these two protocols are going to be key to create organic demand for our lending and and borrowing on our lending protocols for stable coins. And in parallel, of course, there's some other catalysts that's underway. We're constantly onboarding yield bearing assets, plugging them in as collateral because that serves as essentially, you know, a risk-free rate that's more capital efficient in our D5 tech stack.

So, in summary, you know, once we have the perpetual exchange and the prediction markets cooking up in the next couple months, that's really when the core DeFi flu starts really spinning. you know, deep TVL concentrated liquidity on the dexes flows into large borrowing and lending markets, allowing folks to borrow larger positions in stable coins that flows right into the per and prediction markets for trading. Ideally, those traders will recycle their winnings back into the dexes and lending protocols, creating that positively reinforcing loop. So, super excited for what's cooking up for Stabila and yeah, that's a quick walkthrough of the efforts Stella has been doing the past year and the upcoming road map. Thank you for listening.

If you are a stablecoin builder, RWA or DeFi uh builder that can plug into our ecosystem or interested, please do reach out to me after the call or our chat. There's also a QR code here for our partnership intake form. So, you can also fill that out as well and we'll get in touch with you. Thank you.