Impact Summit 💥 Impact of USD Stables

[Music] cool so um we're just meeting uh and both of us have um spent a lot of time thinking about and working on USD Stables but yella has actually done quite a lot of work um between companies he's run and experiences at binance uh especially with us uh stable coins in Africa and the goal here is kind of having a conversation about um why are US dollar stable coins so popular who's using them why are they using them and I think y's had like hands-on experience both kind of driving the adoption of them and also personally uh recognizing those use cases and so going to lean a lot on y's experiences there um and just to kind of give like a really brief starter of like the conexs of how big stable coins are um I think one of the most most kind of Staggering stats is that even though uh stable coins today only make up in market cap only 10% of the current total cryptocurrency industry is market cap uh More than 70% of all volume across the entire industry uh is done through stable coins so even though it's not the most valuable part of the entire industry although it is rising it's by far the most dominant in terms of actual volume moving through it um and one really crazy stat is that you know that number of how much volume is around 11 trillion uh in 2022 and it's it's already Rising a lot more this year which is on the same ballpark as PayPal um and the Visa Network PayPal actually is one and a half trillion and visas at like nearly 12 trillion so stable coins are not just like some cool Tech that's starting to grow in its an early days stable coins are already an extremely large um market so uh y maybe do you want to tell us a bit first about yourself um about your experiences kind of seeing the need for US dollar stable coins and then about your background uh in and helping the adoption with the the binance sure um so it's good to be here uh so I'm I'm y uh co-founder of onboard um I've been working in crypto since 2017 um and I joined binance in 2018 uh as a director for binance labs um where I led Investments for um into sort of like African uh crypto companies uh so invested in companies like yellow card um bitc car Rays um buy coins um and then also founded bondle uh which was a company incubator with the binance ecosystem that provided sort of really simple um um sort of buy and sell crypto functionality for Africans skilled out about 1 um 1 million plus users um um and we've on board what we're trying to do right now is to essentially give people that same kind of custodial wallet experience but in self- custody and the ability to go from stable coins um to your bank account or mobile money without having to go through a centralized exchange um in terms of sort of you know the adoption of stable coins I think that you know what people don't understand first of all is you know we're living in countries or markets whereby we see the local currency losing value against the dollar every single year right um so for instance at this time in 18 months ago one naira was about $1 was 660 naira right now one n $1 doar is about 1,300 so we seen almost like a 50% devaluation you know or decrease in value in about 18 months and so for a lot of people we're very aware of the fact that like our currencies are losing value number two it's also very difficult to get access to USD so you can't go to a bank and you know get get the right you know get the right um volume that you want to buy whether it's for your own personal needs or it's for your business um if you have USD outside of like maybe you get paid as a remote worker if you try to bring that into the country and convert that into local currency you get given like the a wor rate so what has happened is that stable coins have kind of created an open market for USD because you have USD on chain and it's created this almost like an open banking like platform whereby exchanges finan financial services companies are building wallets that take advantage of this open banking USD on chain and building useful tools so we're seeing it sort of like adoption on the retail side we're seeing adoption on the on the sort of business side in fact the biggest drivers or like the largest volumes or use cases come from business adoption um so it's it's really impressive and just you know amazing to see how far and how fast the adoption has been um and I think like we're just getting started no that's that's crazy and can you can you explain a bit about the visceral experience you said like business use cases are like one of the biggest ones like what exactly are are folks doing who are they moving money to uh where are they getting it from and like what apps are they using what's the actual like experience of um leveraging stable coins yeah so I mean the biggest drivers are I would say exchanges um as well as like wallets so for instance if you looked at the download data for trust wallet in Nigeria for instance versus binance um I think binance had about 3 maybe 3.8 million downloads trust wallet has 4.9 right so you're seeing sort of like self- custody growing even FAS than than than custodio products and that's actually because for a lot of people the way they access stable coins is very peer-to-peer so sometimes people don't even go on an exchange to access it but let's say I have you know um Ghana CD or like Nigerian NAA and I'm like I want to save in USD now I know you Liam as a friend or someone has introduced me as a trusted broker what happens is you would give me your bank account I would send you naira to your bank account or ganac to your bank account and then you who have access to like binance or or a yellow card or quidax or any of these local platforms would then send me the USD c or t to my trust wallet so in fact most people who have USD stable coins today a lot of them have never actually been on a traditional kind of like custodial platform right which I think a lot of people don't really um realize um but the biggest use cases really are sort of remittances and crossb payments right and that's because you have a lot of economies that have two exchange rates whereby you know the official kind of like bank rate is never the real market value of the currency right and so if if if I was given let's say um you know $100 CU I did like some work somewhere and if I went to a bank the bank was going to give me 50% or 80% of the actual value I don't want to do that right um and so I would use stable coins because if I use stable coins I would get the real value I'll get value like a lot faster because I don't need to wait for like you know t plus2 or t plus three um and you know I'm able to keep that within my own sort of like control because a lot of people have fears of the fact that and this is not unfounded sometimes you've you know people have had money in uh USD account and they're not able to withdraw the full balance and you know so people sometimes are kind of worried about that and they'll rather just keep the money in in stable coins because they know that okay if I'm holding 1,000 or $500 or $30 I can always have full access to that amount of money um so that's kind of like what we're seeing on the retail side one is you have people who are aware of the currency devaluations and are looking for a way to just preserve wealth or value the other it's sort of like as a um sort of remote digital workers that are earning um USD and prefer to be paid in stable coins um and then also you know if you are doing remittances as well like you would use stable coins because you would get a a a better rate um faster so this are kind of like the the retail um use cases that makes sense so there's a kind of a variety of use cases between like remittances and payments and then also trying to store as a store value because of the the niras kind of constantly inflating um and one thing that you stood out to me what you just said is that a lot of folks that are using these coins are not and never perhaps ever have been uh on boarded via like binance or traditional centralized exchange um can you explain a bit more to that about that to folks that maybe are not as don't don't into it that as well um what are the companies and I know that you you know you're helping start one here like what what what are the companies that um are kind of riding this wave and you think it's the case that binance is kind of acting as like an onboarding uh partner in a sense to people to start holding these coins getting familiar with it and maybe binance won't matter as much into the future or do you think bance will continue to play a large role going forward got it um so I think like um definitely binance is you know one of the uh largest players um and that's just because you know a lot of people are kind of thinking about Africa right now um but in 2018 2017 there wasn't really a lot of like Global players looking at Africa um and you had a few local indigenous exchanges right so you had P2P platforms like um uh Pax remitano local Bitcoins they were like the initial set of sort of companies that people used to use to access um to you know buy Bitcoin or like you know us DT at that particular time um then I would say after binance came in you then also began to have like more local indigenous players right so initially binance didn't have like the on andof ramps so the the the local exchanges were able to integrate um directly into you know with local Fiat channels so Bank transfers um mobile money um and so you had this proliferation of of of players um so in Ghana you have like B in Kenya you have like honey coin um in Nigeria you have like um um quidax busha B buy coins um bit knob um then you also have like players that have been able to scale Beyond just one particular country right so luno for instance um I've not just across Africa but they in a bunch of Emerging Markets like southeast Asia yellow card which is you know um um was one of the companies we we we back to Our Stars at binance um they have about you know um access to about 10 different markets right um and so you have this you know unlike let's say the US for instance whereby you know it's primarily like maybe two or three players in in Africa it's like very very um very fragmented and very sort of like um you know it's binance is sort of like the the the market leader but you do have a bunch of other players um playing in the space as well that makes sense um and once folks kind of start you know adopting this and uh they're holding coins there's kind of two directions I think that are interesting to look at one is the degree to which the existing crypto space is supporting those users for example I know a l of them actually are on holding their coins you know the coins are resting on Tron after they're using tether as a huge percentage of them um and you know the crypto cryptocurrency industry building products for those um holders but then there's also the other the other um Direction Where perhaps um those users are actually going to start exploring web 3 applications dii and other things like that asess I'm curious your opinion on both like what do you think the cryptocurrency industry could be doing better to kind of to serve the needs of folks now that are holding whether it's tether on Tron or or USC on another chain and in the other direction what do you think um those folks now that are holding coins effectively in wallets uh or have the ability to start using daps and things like that do you think they're going to or do you think they're not going to I mean I think that's a that's a fantastic question actually and it's something that I think about um every day um I think that what stable coins are are like I said they're an open Financial platform right so if we were to think of the web two world it's like imagine Apple pay right um or Google pay where or you know Google Wallet Apple wallet whereby you've taking money from your bank account and you've put it into this closed ecosystem now developers and sort of like startups or companies can decide to build a whole host of applications one vertical of applications are Financial applications um now in the web two World those financial applications are kind of Geo fenced in a way right so I'm in Nigeria or in the UK I can't use venmo right um I can use imp PESA in Kenya but somebody in in London cannot use imp PESA right so but in the web3 world you know if I build a financial application for usdc or usdt you know anybody that has that stable coin can use my application right um and so I do think that there will be a group of developers you know and I fall into that category that I focused on saying okay how do we create worldclass financial services that you know it doesn't your location doesn't sort of matter your ability to access that right um but then you know it's not just about financial services people want to sort of have fun and play and do a bunch of different things and I think one of the most interesting things that I'm seen you know with the rise of like you know less D5 focused chains like base is like this exploration of like just fun onchain activities right so it kind of reminds me of what the early internet would have felt like when people were just kind of discovering a whole host of different websites um and so I think like both worlds would exist simultaneously however the biggest elephant in the room in a lot of Emerging Markets is like usdt and Tron right because Tron for instance is you know doesn't I mean has smart contracts but it's not an evm chain um and it doesn't have the same kind of like you know Focus or like you don't have a lot of developers who say they're like Tron developers and are building like dapson Tron um so you know the the question then is how do you bridge or bring users who are holding stable coins on Tron into sort of like the um sort of ethereum um and web3 ecosystem and what does that look like um and so you know that's definitely something that I'm very curious to see how that plays out you know it's kind of like I think Tron as like BBM right so if you think of blackberry the key application was was was was messenger and even though they had an app store it was like quite limited and then you had like apple launch and then you know you had WhatsApp and you know because it was just a better developer platform you had a just a much more thriving and active ecosystem and so people over time kind of moved moved from holding blackberries to like Apple and Android so I kind of think of I use the analogy when I think of like I I really love that analogy like I don't know if you know this but I'm from waterl Ontario where Blackberry started and so I use BBM and soed all my friends in high school because you know the whole you know the whole city used it um and actually there's a great movie out now about history of blackberg it's called Blackberry where they say that's you know waterl is where the vampires live and actually I was looking for a Halloween costume idea so I'm glad that you brought that up um okay that's that that makes that makes a lot of sense one really specific question that maybe relevant to a lot of developers here is when you're when you're getting folks on board onto you know holding stable coins how how did they think about when you you said there's a lot of bwp payments remittances they're they're moving money between each other how do they address each other because I know a lot of folks they have a Tron address like their binance wallets Tron address is something that they can share they might say hey send me money at TRX blah blah blah is that how you do it or do you do it in a different way no I mean it's it's the same thing right like it's people just share like their addresses um I know folks have tried to build um different things but I haven't seen any sort of solution take off like that crazily and that's just because like it's not quite the same as like email right so you know it's like PayPal was a was was a clue Loop Network and it allowed to send money over the internet right but this comes by default so it's like how do you create that closed how do you create sort of like that that that ecosystem so um I think actually it would be interesting for developers and I thought about this but I don't know how exactly to do it to maybe is there a way to do Tron addressing on ethereum where if someone send you a Tron address you could send it to their Tron address on ethereum like that might be an interesting kind of hack to onboard folks um and actually that you know interesting kind of Segway here is I saw recently that um David Marcus launched uh he was he was the creator of he ran messenger at Facebook he now he runs Light spark he just launched I think it's called Uma um Universal something something but it's like they use an email address type format um it's actually the question I wanted to ask around that in addition to your thoughts on that but the question I want to ask it around it is you know the original vision of Bitcoin was basically this like Global peer-to-peer digital cach um that was you know separated from the state and ironically we've created this kind of peer-to-peer cach that's controlled by this company tether that no one really understands and is kind of the definition of an opaque Central Bank um but what's your take on that why aren't we using Bitcoin and what what's how did this all kind of emerge as opposed to you know maybe bitcoin's original Vision yeah um you know I hope this doesn't come across as like uh um what's the word now controversial but I think that um because Bitcoin has a capped Supply right um and is like the most popular crypto asset right you have this very basic kind of economic rule of demand and Supply so if you have an asset that has a fixed Supply and the demand and awareness continues to grow year on year you know like the price over time will continue to increase and we've heard stories of people you know I think the most famous one is the guy that bought like two pizzas for 10,000 Bitcoins like nobody wants to sell nobody wants to buy you know a million dollars worth of burgers or chicken and chips you know like today and like just hate themselves for doing that right so there a fear Bitcoin become yeah exactly that has made Bitcoin become like digital gold right um and stable coins have kind of stepped into sort of solve that initial problem but for sure it's it's still connected to to sort of the you know real world in terms like it been dollar back right um but then that's also why I'm excited about things like D or like flat coins that are not necessarily backed by um sort of real world assets but I think those would also grow slowly over time right so people need people need Stepping Stones to kind of go from like zero to one right so if stable coins are like the main onramp that gets people into the onine economy people then believe and say okay you know what I want to do you know I want something that is like not tied to like the the the the USD um and it's fully on chain um and decentralized then they can decide to hold die or hold like um some of the flat coins that are coming out right um but you know I think at the end of the day the beauty of like our industry is that the market kind of decides what the winners ends up being right so as a as a build and it's something I tell myself all the time is like I should just focus on what like our customers want and and try to deliver value for people right so um even though I have very strong ideologies about what I would love to see in the space um I also kind of follow what users want like that's like my number one match I make something people want yeah that's absolutely right and I I saw I think Dan rero tweeted the other day that like one of the hardest problems to doing crypto is just actively grow kind of a user base that uses whatever your product is every single day and a lot of folks in crypto tend to kind of ignore that uh and focus a bit more on you know you ideological decentral decentralization Technologies or on things that don't actually end up getting used every day and I think it's like good that that that's like your focus area um but actually um kind of like maybe a final question here uh is in doing so you know you're going to run up against that exact dilemma effectively it's just like how to what extent you lean on De centralized Technologies versus the more centralized approach and you also mentioned you know you're kind of building a custodial uh wallet um I'm curious on how you see both the regulation around that developing because you know obviously like a self custodial wallet perhaps is not regulated at least in the United States for instance like it's a not a money uh transmission business or money service business it's just a wallet just software uh and so you can maybe scale faster but if you're doing the custodial custodial approach it's you you have to kind of be a bit more careful how do you think about navigating the regulation around um you know building a wallet like this yeah so just just a correction we're building a a self- custody wallet so my my previous company was a custodio wallet and I think that is kind of in line with what you've said in that um at the end of the day if these things are Financial assets Securities or not they are Financial assets um and you're holding custody of those assets um as we have more regulatory Clarity I do think that you know custodial crypto or digital asset service providers are going to be regulated very similar to financial institutions um and that means that that takes away the buness nature because now you have to be thinking about regulation from hundreds of countries from across the world right and I think like we've also seen what can happen when crypto isn't regulated right so I give an example of of let's say svb and um FTX right so s SV Silicon Valley was uh sort of FD sh bank and when they ran into some troubles the government stepped in and sort of back stopped the the the losses right um and then FTX it's been a year and we're still trying to figure out what the outcomes would be so in a way if we to create a ladder of like sort of let's let's let's use it like satoshi's hierarchy of Financial Security at the at the top is like sort of like self- custody then you have sort of regulated trfi and then to me at the bottom of the food chain is like custodial um unregulated custodial crypto right because as long as you have humans in the picture you're going to have One Bad Apple or one bad actor that tries to take advantage of the sort of the goodness of the rest of people right and that's just unfortunately what human nature is um and so I do think that regulation would actually end up pushing us as an industry back towards um kind of what Satoshi envisioned which is you know um a a decentralized open transparent um Financial system um and you know vitalic and and the etherum community have sort of extended that into like an open and transparent sort of application um um um sort of platform right um and so I'm I generally think that like crypto would sort of B create into these two worlds of like regulated crypto regulated crypto that is compliant um focused on sort of like security of users and then sort of self- custody crypto that is peer-to-peer on chain um defined by smart contracts so in this in the regulated self in regulated crypto World regulation essentially protects customers in the self- custody world smart contracts and sort of the open job protects customers and that that I think is kind of how I see how I believe you know the crypto industry would evolve that makes a lot of sense and and I completely agree and I I think also that it's been the case that as developers have built better and better and better um Technologies to make it easy to do self- custody like these days you can store your you know you can use like your pass key on your phone as your private key that increases the bar of How High quality like the experience has to be for any centralized competitor and if it gets to the point where like it's just better to use the decentralized version you know I think we've succeeded um as a space um I know that we're kind of past the the half hour mark so I'm going to say um thanks very much I actually I want to keep talking for a lot longer I hope we can do that afterwards but um maybe just before we go do you want to to share kind of quick note about how people could either get in touch with you or learn more about you and and your company sure um so on Twitter it's uh elos so um y e l e b a d e m o s i um and then um it's onboard wallet uh so like onboard into web 3 so um o n b o a r d um wallet um and yeah if you're interested in sort of um a protocol on you know that is building peer to care um Global on and off ramps um for people in in sort of you know Frontier and iming markets um on on l2s um would would would love to chat you know we're we're out of beta and sort of you know rapidly um expanding into as many countries as possible so yeah looking looking to build a community thanks so much so yeah um I think for me it's sort of just continue to improve like the ux so right now stable coin still feels like it doesn't feel like fintech is probably the place whereby user experience and sort of like you know Financial Services working really well so the buy is quite high and so when you introduce stable coins and it's competing against sort of sort of fintech 1.0 that is like already really quite good then we need to do things that you know the ux works and the applications are just like really amazing so I spend all of my time trying to think about like what use cases do we need to create that fintech can't just rep okay right um and that way users are coming because they're like wow I have this financial problem that I can't get in the real world without this sort of you know amazing use case that I'm getting on chain um and you know within the context of Africa like the thing I'm very bullish on is credit right like I think that you know Africa and a lot of energy markets do not have credit and the US is highly dependent and the US economy like like is dependent on credit you know so that's something that we can't solve in the traditional mana and I do think like an open um sort of credit economy on chain um is going to be one of the big guest sort of use cases I'm excited about yeah I guess um I think it's important to kind of understand the macro way in which T Quint fit in into the uh the picture here and it's not necessarily that stable coins are like an application of blockchain uh necessarily I think it's more important to think of them as like a bridge from The Real World uh into the blockchain world um and then you know once you're in the blockchain world there's lots of things you can do but it's almost like a bridge and so if you're building something um that's purely only makes sense in the blockchain universe thinking about it as almost like a technological backend um that's going to be used used by people that are going to be bridging into the system so for instance um you know a lot of folks now are kind of starting to work on account abration wallets or better wallets in general for people to use say defi or nfts uh I think it's going to be really important to think of what you're building is not just purely for the blockchain user base but also for everybody else that's getting into this space that maybe doesn't have any idea what those things are um and one of the best examples I've seen recently has been a company that's just been doing a really dead simple venmo like mobile app where you can sign in with a pass key and it's just literally send you know there's a simple naming scheme and they're not just trying to Target this at people that are already using say ens names and that are at crypto conferences they're trying to get people that might you know be in Nigeria or might be in any other country that need to do remittance or something like that and Market it as a product that just cheaper faster better than any existing remittance product out there so making sure you know who is your customer exact are you thinking about your technology as a where your customer is already a crypto user or is that the technology backend for your real customer um I think it's just important framing it thanks guys