Matthew Commons - NextGen Stablecoins & the Omnichain Future

next up we have nextg stable coins and the Omni chain future and we have Matthew commins president of the verified USD Foundation thank you all right thank you okay um great um Matthew commin president of the verified USD foundation so uh great to be here today we are one of the title sponsors of the unstable Summit and uh it's great to be here with all of you you know eth Denver is really uh about bringing together all the leaders in the web three space and this group here uh really about the future of money uh so we had some good panels already earlier today and uh many thanks to parvina Nick and Zach uh for putting together a great event so um we'll be talking today about uh this idea of a next gen stable coin and uh the Omni chain future so um before kind getting into the Next Generation I want to first start by just where we are today and uh when we look at this today uh we're in an ecosystem where the stable coin landscape is dominated by two issuers uh tether and circle on Two Chains uh ethereum and Tron today um you know these are these are two issues that were you know had a lot of innovation um first mover advantage and really have stayed in place primarily due to to the economies of scale and the network effects you kind of have a tether on Tron ecosystem and you've got a usdc on ethereum ecosystem and those really form kind of the basis of the stable coin landscape that we have today and there has been Innovation they they've grown to add uh additional chains um and have actually stood up to a pretty challenging regulatory climate over the past few years um but when we look at this I think we need to ask ourselves is this really the right foundation for the future of web 3 um or could we do better by looking at enabling Innovation across even more chains um more communities and ultimately by sharing the yield of the underlying collateral in a much more Equitable way with many more minting Partners than we have in just this duopoly so that's what we're doing at the verified USD Foundation together with our partners layer zero who's our technical partner and Matrix Port who's our operational partner uh so let me tell you a little bit about uh usdv which is the stable coin we had a soft launch about three months ago soft launch because there was no pre-announcement at all it just appeared one day in November and we've been growing since then and this uh here is really uh you know one of the first public events that we're doing talking about usdv and the ecosystem so um you know the biggest difference in terms of usdv it it has some similarities with other stable coins uh you know mainly that it is coll calized it is a it is a fully collateralized stable coin uh our collateral is tokenized us treasuries that are all visible on chain um but it is also really a decentralized stable coin which is different it's not just an algorithmic stable coin it is a fully back stable coin but is one that is also decentralized and its aim is to really get those economies of scale and the network effects that you have with the big stable coin players but to do it in a way that empowers a broad decentralized ecosystem of uh different web three communities around the world so um you know how does this work so there are three main differentiating features about usdv that uh other stable coins don't have uh the first is Omni chain interoperability and this is a specific way uh that we do this so we are the first stable coin to use a technology from layer zero called of the Omni chain fungible token standard and um this is something where while we're live on 7 chains today layer zero connects to over 50 chains today and we do believe in a world where we can be native on literally hundreds of chains um you know and it's not that far in the future that you look at if you go out at uh at e Denver go around you know you will see all kinds of l1s l2s l3s evm chains non-m chains app chains side chains rollup subnets um you know and and these are chains that really deserve having their own native stable coin if you can do it safely and if you can do it in a way that unifies liquidity I like the centrifuge uh thing before about um you know defi condom and and uh things like that I mean you really have to be be very thoughtful about using wrapped tokens um you know there are different security vectors and the ability to uh offer native tokens on more chains is is really critical for the growth of our ecosystem uh the second point is around onchain transparency uh I think this goes well beyond just annual audits or monthly audits uh this is something that will be talking a little bit more about uh in in this presentation but um you know something that we really aspire to be uh to be a leader with in terms of understanding what is behind uh the stable coin that uh that we're using and finally and this is something that's truly differentiating um really unique and um uses a technology from layer zero called color Trace what is different about this is that at the verified USD Foundation we're not actually the mentor of usdv rather what we do is we provide a unified legal governance and Technical framework to allow other partners to come in bring in new capital bring in new users and mint usdv in their own color and those Partners could be uh centralized exchanges could be dii protocols could be other algorithmic stable coins like fra for example um you know could be OTC players uh can be uh foundations for other chains but really uh allows the um the protocols that are bringing new users into the system to have their own color and to share in the yield of the uh the underlying collateral so just kind of going under the hood a little bit um so oft uh this is what allows usdv to live on many chains without asset wrapping without middle chains without liquidity pools um to be native on more chains um and to do it in a safe way so every usdv is born on ethereum Main net that is because the coll Al token lives on ethereum mainnet and is locked up there so $1 of collateral token backs up $1 of usdv um but uh this allows us to live natively on different chains and the way that this works and you can do this through through Stargate or through other types of widgets embedded in our partners uh if you're sending a token from one chain to another uh the first step and this all happens kind of seamlessly behind the scenes but uh but but what is happening is your Source chain you're you're locking up the token uh you're you're burning it on the source chain sending a message through the layer zero protocol to the destination chain minting a new usdv on the destination chain and then there's a mechanism of providing unified Supply across all chains so we know at all times exactly how much usdb is outstanding on all the different chains and through another layer zero technology called pre-crime if there's ever any issue or security issue on one chain we're able to segregate that from uh from the others so uh the second point is uh through onchain transparency we're using as our collateral token a token called stbt which is short-term treasury bill token uh which is issued by an affiliate of Matrix port and a special purpose bankruptcy remote entity uh we do anticipate having other chains as well uh other collateral tokens as well um provided that they're using the appropriate uh highquality collateral stbt is using chain link for proof of reserves and we're very pleased to announce actually today the press release just went out a couple of hours ago is our partnership with chaos Labs really one of the leaders in uh the security and transparency space um sharing uh the analytics framework uh with them for for stbt usdv and other real world assets um let me see if I can do this here um I was going to jump to the Dune but that's okay um so we do have a uh a dune dashboard as well that kind of goes through the uh St BT that's outstanding in the underlying collateral there's about 87 million of that of that 87 million of the underlying collateral token about 28 million of it is locked up and issuing usdb today uh across our seven chains um the biggest chain it's all born on ethereum um but on the other uh seven that we have as well so um let me see here okay um so the the major differentiator or probably the the one that really know state stable coin is uh other stable coin is able to offer today is this uh this color Trace technology and that's really what underlies the ability to share the yield with our partners so um you know the partners as mentioned can be centralized exchanges decentralized exchanges uh algorithmic stable coins others um and when they lock up stbt and mint usdv they don't need to hold it themselves that can travel across chains across protocols and others and they will continue to earn a share of the yield from the underlying assets uh so today stbt is yielding um around 5% a little more a little less depending on the day um and that yield by default is shared at least half of it goes to the mentor uh but in some cases it can be more if uh if if we are uh engaged in different types of promotions and so forth uh together with the foundation um and uh security uh this is really kind of the special saucet under the hood there's some some white papers and others around kind of exactly how this works but the ability to have a completely fungible token but one that you can also track the colors of who minted what uh is is really critical and to do this in a deterministic way um that um you know is able to track how the yield can be sharing is something that is uh is really different and really enables what we view is uh as kind of the decentralized future of uh of stable coins here so our ecosystem this is one where I would love to have more time to be able to to go through this um we've got great partners across the seven chains that we're live on today um a lot of the dii and amm players that you see here are at uh are at eth Denver um so looking forward to to diving in with uh with each of those I mean there could be stories and and case studies and so forth really on all of these um but uh you know what I think I'd like to do today is is kind of um share one particular case study which I think is representative of what usdv can enable and that is uh with a chain that some of you may not know about it's a chain called vition uh which is an evm compatible chain that is focused on the Southeast Asian market so uh southeast Asia is a very very attractive market for uh for Define and web 3 Vietnam in particular um you know Vietnam about 100 million people very young and dynamic uh tech-savvy Society but also one that is underbanked um so there is a really large and growing penetration of uh of crypto assets there but also uh you know it's a difficult Market it requires a lot of local knowledge and usdv uh has been able to partner with coin 98 with viction uh with other players in that area and really offer an native unchain stable coin uh where you know Circle and and tether are not offering uh today um so we're able to give that um you know able to give that value uh enable them to tap into cross-chain liquidity and uh really enable some phenomenal people and phenomenal opportunities so these are the types of things that as we go forward again we're only 3 months old today and and just had a had a soft launch these are the types of opportunities that usdv will be enabling in the future I mean we want to have a hundred different victions uh you know throughout the world it could be different chains it could be different app chains could be different communities um you know we're all about Partnerships we're all about enabling uh others to to Market and grow and uh and share on the benefits here um so so um you know we will be here at uh at eth Denver we'll be having a booth actually going to be on uh some panels later we've got um Cynthia from uh Matrix Port I think is going to be on the next panel uh I'm going to be on one with Irene woo uh from layer zero later today and will also be at uh you know eth Denver um uh presenting on a panel on Saturday morning so come out and talk to us uh again the way that we grow is by partnership so whatever chin you're on whatever project uh we'd love to hear from you we'd love to talk to you and see what we can do together so thank you very much for your [Applause] time