Crypto Mass Adoption via Blockchain Payment Rails and Stablecoin - TOKEN2049 Singapore 2023

can you hear me uh thanks for coming after the lunch break uh how many have you guys been here last year oh not that many well if this is your first time this is a great event so today I'm gonna talk about the crypto massive adoption via blockchain payment rails and stablecoin this is me I'm the founding partner of story Ventures where actually a early stage blockchain Venture fund focusing in the crypto payments sector and infrastructure previously I worked for kind of two large crypto companies one is coinbase one is circle that's really helping us to shape the form of payments uh in the past while I was working at Circle leading the product development so today I'm gonna share about some of my learnings and also the on the investment side where we're seeing the crypto blockchain rail is being utilized foreign so if you think about how we transfer money in the past from point A to point B so there are three Legacy payment rails one is the cart network ACH and also bank wire transfers So currently actually all three of them can be replaced by blockchain entirely right if you think about transfer money from A to B now we can choose any blockchain of course they need to have the capability to enable right faster speed or transfer value so let's say if that's the case for the future what we have to do to bring the massive adoption from web 2 to web 3 is really to enable these people to be able to transfer from fiat currency into buying cryptocurrencies right currently there are two types one is like General tokens Bitcoin ethereum or stable coins so the other one is actually nfts right A lot of people don't think nft is really kind of like a cryptocurrency but it actually holds values right doesn't matter it's art collectible nfts or gaming nfts so if we are actually able to enable all the startups or new Innovations to transfer value from Fiat to cryptocurrencies we can bring the mass adoption now let's look at stablecoin um to me personally I really believe stablecoin is one of the most innovative solutions in blockchain and crypto ecosystem so let's actually go back to let's say the 90s or 2000s that's where internet was innovated my entire career acts is actually based in Silicon Valley right back then you have the internet or browser initially was from Netscape and then to Yahoo and then to Google and then later on we see Facebook dominating The Social Network literally is connecting the world together so now we're sitting in Singapore we know people what they're doing let's say in the US right we can talk to people over there in real time so moving forward let's imagine a world that all the countries are actually launching their own stable coin back to their local fiat currency so that's really what we believe the future of Internet which is stablecoin becomes the internet of money so where you can imagine a world where people around different countries can actually do foreign exchange more freely right for a lot of countries if they have high inflation rate they can hold into a stable coin backed by the U.S Fiat currencies and then freely without a lot of restrictions to move around the globe so here are some data we're seeing over 130 countries have a cbdc initiatives right which is a government-controlled or backed stable coin currently there are 11 countries already lost their stable coin initiatives right one of the one of the stable coin kind of guidelines we see out there is actually from Brazil uh we actually think the government have been doing a very good job has a very comprehensive guidelines to encourage private sectors to lost their stable coin to help the country to be more you know getting involved and participating into the new ecosystem and here are a few countries that currently are launching their state points or working on them so really in the next 10 years we're gonna see a whole lot of transformation in the financial sector um here are a few kind of benefits why we're using blockchain I think a lot of people probably are very familiar with faster speed or even the lower fee right so a lot of my friends are in crypto they're like I I don't really sleep because I'm trading 24 7. it's actually become somehow pretty difficult for people who are working in the industry but also you can see it provides basically the ecosystem that you can do instant transfer no banking holidays we can do this 24 7. lower fee on the other hand is really a lot of we see a lot of applications out there it's really reducing the transfer fee let's say in cross-border limited services use case or even the cart network but currently the Legacy ones let's say they're charging three percent eventually I think we can really go down because there's really not much a lot of costs of transfer money from blockchain like on chain transfer except you might have to pay some gas fees the last but not least one is the programmability I think a lot of people kind of sort of ignore that maybe because we're so early into the eco blockchain ecosystem development what I mean here programmability is really about smart contracts are able to are are able to allow a lot of developers to set up kind of different conditions to move money between wallets right so let's say you can set a condition saying on certain day if a wallet is lower than 10 000 I'm gonna move money like let's say UICC from three other wallets to here either in a batch or gradually whatever you want to set it right so in the traditional banking World basically that's unrealistic right it's not really achievable so what I'm saying is in the future once we're enabling more blockchain infrastructure project more applications we're actually gonna see a lot of smart contracts are being in the play to moving to move this blockchain ecosystem into more efficient into better like out lower operational costs foreign here is a big picture about all different kind of use cases we're actually seeing in the ecosystem the companies in the on the left side they're basically what we're seeing the web to fintech unicorns and now we're seeing on the right side a lot of crypto startups are already coming into the place to challenging the traditional web to fintech companies right you're seeing here coinbase is a web 3 version of Robinhood doing trading Moon pay and transact they're basically in the place in the space of B2B and peer-to-peer payments and circle actually has many product lines but one of them is actually a payment API services which you know roughly the same as what stripe is currently providing for web 2. you're also seeing other companies here like request Finance is disrupting in the payroll and invoice uh vertical Ripple has been along for around for a very long time so they're coming in to replace MoneyGram at Western Union and one of actually our portfolio company called The Keeper over there is doing lending and borrowing in Latin America using liquid crypto liquidity pool and then you are also seeing a bunch of crypto wallet like a lemon out of Argentina is really replacing a lot of Neo Banks and there's a company called sardine is really into the kyc um AML space for crypto here are really a few really large logos right people are aware of these companies These Are banks and Enterprises are already in play of using crypto or blocking Technologies I think we're very familiar JP Morgan has a stable coin be launched for several years they're really Innovative in terms of a bank and they're really seeing the value and pushing forward and you're also seeing like BlackRock we're very familiar their new ETF has all recently just came out brought a lot of Enterprise attention and also institutions so these are very encouraging signs right large company actually do want to push the boundary want to be more Innovative in the space here um I'm gonna switch gear talking about emerging markets and how blockchain is benefiting in this region I come from the US so what we trade as Emerging Markets are Latin America uh southeast Asia and also Africa right here is few data points of Latin America on the rapid growth of crypto but also a significant numbers about their inflation rate I'll give you kind of like contracts number in the U.

S inflation rate was about two percent last year and this is a number of 2023 like one year data of Argentina is over a hundred percent so imagine a country today you get paid with like a dollar right next year it's worth kind of like nothing um so that's one of the reason that we see countries like Argentina or other countries in Latin America there is a booming crypto startup ecosystem several Founders actually told me you know over the phone or in person they're like I got paid like six months later my money doesn't really worth a lot of you know value anymore so I really want to build a solution to not helping myself but helping all the others my friends and my family members uh Latin America last year has over 51 of crypto adoption rates right basically means people within that country half of them have transferred uh on blockchain so basically made uh either cryptocurrency purchase or transfer from one wallet to another so that number I think in in the current like worldwide ecosystem they have the highest adoption rate right in Latin America and one third of their uh like consumers have actually transacted unstable coin here um let me introduce you a couple of use cases we're seeing in Latin America uh if you actually look at the number on the left currently we have about 25 of the global population don't have a bank however in Latin America or even southeast Asia we're seeing that number is as high as as 70 percent right so the crypto blockchain solution for a country like U.S or maybe Europe it's really like the vitamin solution but if you think of a lot in America it's quite the painkiller solution for these countries and the residents in these regions so two well-known use cases one is cross-border remittance Services right via blockchain you can get nearly to zero percent of fees but if you use MoneyGram or Western Union is 10 percent and the lemon at the bottom which is a crypto wallet in Argentina that has some massive market share they're currently launching a Visa card you can use it actually regular stores via POS machine so I think today I'm just gonna stop here uh give you a takeaway that blockchain payment ecosystem is not really just to helping the current Financial ecosystem to be faster cheaper you know more programmability but also in a region like this it's providing people with more financial inclusion to be more included into this worldwide Financial system so this is my talk today and thank you everybody for coming if you have any questions this is my contact information Telegram and my email thank you everybody