Engineering Yield Access: Bringing Institutional Credit & RWA Structures Onchain

This panel is defining the landscape of um I guess uh how we can engineer yield access to bring institutional credit and reward assets on chain. So we'll just start maybe briefly with introductions of yourselves and then we'll get into some questions. So my name is uh Jordan Bulu. I'm the founder and CEO of ST capital. State Capital is a family office and we uh been in the space for uh quite some time.

We invest, we also build projects. Uh we also have a significant amount of voting power and tokens in the space. Uh I was also the first one to join and help on curve finance. That's it. My name is Dennis Dinklmire.

I the founder and CEO of Midas an asset tokenization business. We tokenizing yield instruments together with Finara MV and and other um investment funds. uh prior to tokenizing um asset managers um I've worked in asset management myself um where I spent my career at Goldman Sachs and Couple Group. Yeah. Hi Martin Kenza co-founder of centrifuge.

So been in the space of RWA tokenization for quite a while uh and come more from the fintech corner. So what I did before was basically kind of a web bet 2 version of private credit and uh started in this centrifuge with the web 3 version and went through all the ups and downs and uh sadly you're being part of it. Yes, I was part of the success and failure of Martin but co-founder of steakhouse and we are the largest creator on Moru a learning protocol and we are also helped to launch grove which is a 1 billion subd of of sky from now on there's only successes so David Vach head of tokenization at Fasinara Capital so Fasinara is an asset manager focused on real world assets and private credit but what also makes us unique is we have a digital asset arm. So since 2018, we have been in that space as well with the market neutral crypto hedge funds. So we really combine real world asset yield uh with the liquidity and composability that's needed in DeFi.

Okay. Since we have a lot of OGs of world assets, um I think it's really interesting to hear what sort of specific pain points have you guys seen and experienced and what sort of pain points do you see going forward? So in the past and in the current lawyers we all love them but they are not really onchain compliant and they always want us to be offchain compliant. So it's now it's actually quite complicated all the legal aspect especially let's say you are decentralized protocol you want to invest in real stuff you cannot come oh I have this door on a forum that will not work then you need to spend a few hundred,000 to get lawyers and to create SPV and all that came foundation uh that will take you six months and then you can do stuff but then you will still spend quite a lot on lawyers so going forward my view and very interesting to see to hear what other people are saying is liquidity getting access to those to the real world assets that's quite challenging having a price onchain especially for those that are a bit more illquid we need secondary market premium market are fine but we need signary market onchain yeah I can copy that I think would turn it around so liquidity and structures to provide liquidity when you need it uh I think is kind of now about to start and it was really missing in the past and I think the second point is really also something where we had built real real asset structures in the past where you basically or it's still mainly the case where you built blockchain structures on top of traditional finance structures and of course that is not more efficient and cheaper it's actually the opposite you create something on top which is uh already you know coming with some cost level and you make it most likely even more complex and more costly uh and I see already that is also about to change so Maybe we are learning more here in the panel. Yeah, I would I would just echo all of that.

But you know the way we look at it is it's really fragmentation. So siloed systems as I said interaction of trady legal versus defy as I said liquidity again you have to operate and navigate different layer ones let alone different networks within that different token standards and a very different user experience. So that's probably been by far the biggest challenge. Well, um I think it's a good recap from the um I think those uh challenges are now starting to to be u more and more um easy to navigate to because of all the big names uh that we have heard recently making acquisition M&A or IPOs or uh like stripe revolute as I mentioned before in the opening ceremony. So now the point in um even so regulatory uh wise um lawyers and etc uh were tough before now it's very strange because they're all asking how they can actually join.

So there's a big shift. Uh still not easy to uh have the bridge between TFI and and Defy, but it's becoming way more um uh way more interesting. I would say for players that are actually starting to be uh have significant amount of involvement uh in DeFi and Trafy. It's a big window opportunity. Yeah.

That's anything to add. um relaying on the on the comments um I think liquidity is a very very important um um challenge to solve. Um however um it is actually important to remember that liquidity offchain tends to be far deeper than than the entire ecosystem you have on on chain. So this is a a complexity we still need to challenge. I think overall the utility of blockchains and onchain finance needs to needs needs to improve much further um in order to get um a real product market fit um for for chain are Are you going to be looking for low latency chains?

Do you think liquidity is going to migrate to a chain like Salana where now they're made protocol level changes um catering to institutions? Thoughts on this? I I can add to the point of of latency. I think that's definitely a very very important um important consideration um um um the one paradox we're facing here is that multiple computers will always have lower latency than one single computer. And when we compete on latency um for instance um the the the deepest asset pools we have today not RWAS but traditional asset pairs so on dexes or curve um um you actually still have price discovery happening in a centralized exchanges because the latency is lower.

It's very hard to compete against one computer when you when you verify with multiple computer. Um so that's sort of one one of these mild paradoxes you you face here. But um the the benefit of tokenization of of any assess on chain is actually that you transact um on chain and you have self custody. So you you you send a token then you receive the token and you have no middleman in between. Um so that's a really important proposition and allows other use cases than just the the medium of exchange.

Um and for that of for sure latency is a very very important consideration and Solana will do will do very well as other ecosystems will do very well too. Yeah, I think latency isn't good narrative in order to keep the VC and the chain and the market cap pretty high. But in term of use cases, uh can be very different. I mean in web two or web one even uh have you ever heard a project saying oh I don't know my game I cannot run on Google cloud because it's not fast enough. I mean and Google cloud or Amazon they go by 100 or 1000x faster than whatever chain will be able to do.

So the point here is like for most use cases you don't really need to have fast uh transactions or settlement. Um in term of real world asset if you ask someone do you prefer having um super fast chain or do you prefer tapping into a2 billion US uh liquidity depth I mean they would choose liquidity right and the liquidity doesn't actually come because the chain is super fast comes because you have all the different uh components that you can plug and play bridges or uh regulatory uh certainty uh all the different abpect Yeah. And if we even take a step back further to that, the the very question from an institution standpoint, if anyone here in this room is sending an email from their Gmail account to an outlook, they never really need to ask a question or think about the latency or the performance. It's obviously just already set. Whereas here, the fact that we have to ste keep continuing these conversations and analyzing different layer ones and plus and minuses just shows you how far we still have to go and where this liquidity mismatch you were saying still needs to be resolved.

So really we need to sort of get over this and and find a way that all their ones can interoperate and we can try and take what's the best of tradi but especially the the liquidity that Dennis brought up. That's the key missing component. Yeah. I was I was at the Goldman Sachs digital conference two days ago. I mean everyone was speaking about tokenizing on Ethereum.

I never heard about Solana there. I not anything else to be honest. They just moved from Bitcoin to Ethereum. So it's not going to go faster than that. And just on the speed I mean there was a research paper saying there was a 7,000 asset transaction over the last year.

I mean that's makes one every hour. So we don't need to be super fast. Currently the meaningful reward operation transaction per day are exactly zero. Meaningful meaning not niche product zero. So we could even do it on bitcoin it should be completely fine.

Yeah, maybe I can just add that uh I believe we are not there yet where we need that latency. Solana is providing for real assets at least like what you mentioned uh about crypto assets and calling them traditional assets out of the of the bubble. I loved it. Anyway, I think it's when you build deeper liquidity structures uh and actually finally at the end need something like high frequency trading and uh kind of you know uh products you see in Treadfi where I think you need really the speed of execution and and milliseconds counter or later it will happen but I'm not sure if we are there yet if it comes to real yeah I just want to make sure like the audience understand this is real asset not like for other use cases like gaming or whatever you need like fast transaction, low cost and etc. So the point of being a world asset not necessarily having the need of low latency it's it's something that is really important.

Um speaking of I guess the the chains that are being considered at at a certain point you know you have a lot of liquidity fragmentation going on. How do you think the interoperability will look like going forward as say L2s develop maybe maybe Salana and drift and you know Apollo get going somewhere but what's your take on that? Yeah, there are two side of the coin. One, if you are real asseter, it should not be too difficult to integrate more chain. You are just burning on one and minting on the other.

It's centralized. So, you just burn the token, you mint it on the other one. You have some KYC issues. Maybe it's you have some crypto party risk, but nothing is impossible to manage. Now, the second the other side of the coin is why would you do this and what are the implication?

It's easy to add the 10 chains, but if you don't provide if you just provide the support of minting on one chain and moving from one chain to another, what did you achieve? Because if there is no liquidity on on each chain and sil from Forge was discussing this this morning, they have a stable coin. They want to issue on many chains, but every time they need to seed the protocols, make sure there is liquidity, uh, bootstrap, give rewards for people to use it. So it's just fmentation of the workforce or or the rewards or the the liquidity they can provide which makes it super expensive. I think it's better to win somewhere where there is actually users.

So ECM is still the biggest chain by TVL or TVS any metrics I think around those. So yeah it's you really need to be where your clients are not where the narrative is. Yeah, I fully echo that. And this is just the point that even if there's 10 chains, 100 chains or two, as an institution, it means we have to have a strategy, a thesis around interoperability. That just brings an extra layer of complexity that our ultimate end investors don't really care about.

you know, we really need to just to Sebastian's point, we need to think about where are the the assets, where are the developers, where's the activity, where's the demand um and create use cases that that meet that and and and be able to um to to join those dots. But when we have to spend extra layers complexity, it just adds more fragmentation and most importantly for end users, it brings more cost into the system, which doesn't help anyone. Uh well fragmentation is very good for us for example like people looking at arbitrage opportunities but yeah for people that are issuing news coin or um those type of products is extremely difficult and the reason it's because it's extremely difficult that the market will turn to uh just one of a few different networks because and we've seen it if you've been in the space for quite some time remember all those different chain they either uh died or move to an L2 in order to survive. So through the umbrella of Ethereum or uh other big chain now if you look at the space there's only like a maybe top five blockchain the other ones are uh either they own or an L2 of Ethereum and this is what happens in a in a jangle right the the strongest only survive and depending on your skills then you have different type of uh of market shares and here this exactly what we're saying like from the panel this morning from association general he was saying that for them even if they have the capital the resources and the energy it's extremely difficult to tap into multiple different market they need to talk to market makers they need to talk to listing they need to talk to liquidity providers and centraliz decentralized exchange lending market and because it's extremely difficult then the market was shifting towards multiple strong chains uh with different use cases one will be more specialized in the world asset. One will be more specialized in gaming, maybe Solana, fasteration, low cost and then but then you need the the the solidity the the strengths of a big one that can guarantee you that the settlement is happening in the right way because if you transfer billions of US dollars then you don't want to lose them, right?

Um, we heard from previous panels about the various risks of bringing real world assets on chain. I I'm curious to see what your thoughts are. If you have a tokenized railroad asset, would you allow it to be deployed to a vault for rehypothecation? And if so, would that only be with professional managers or would you just let it go free and let people reloop, you know, as Dgens do? Strong.

Yes. on all of the above. On all of the above, yes. But how do you manage that risk? Do you manage that risk yourself or like who bears the brunt of that?

Um my my answer to this I think um tokenization in its own right is fairly useless if you don't have use cases. It's very important to remember that I can invest in a black rockck money market fund without in token involved. possibly is that I have lower fees actually because transaction costs and otherwise tokenization is only really useful if you have composable use cases. So we need to have a base where we actually need to do and build real world use cases that actually create real utility and real value. So in regards to tokenization trading may not be the best one because you're pointing out regulatory risk.

Trading actually in liquidity involves significant regulatory risks spec specifically on multilateral exchanges that the trading and liquidity of of assets is challenging not just because of the latency of a decentralized network and computer but also because of a regulatory sense that's very hard. Now report transactions are fairly widely done in in traditional finance that on a risk profile it really depends on a subjective interpretation who exactly performs what activity it's a very different thing but I think we've seen examples um but it works extremely well um just because something is a real world asset is actually a compliant security um it doesn't make it better or worse than other token crypto assets that may claim they are digital assets but actually are RWAS um but um to give an example and we we very very proud to announce this. So this is a world first. So use this opportunity to to use this um alpha we sharing the alpha um this is a world first. This is we're very very proud of this.

It's been three months of work going into this. So um together with the team at Fasinara and we have developed a tokenized private credit fund that is a permissionless token and and transferable token on the secondary market. um not OTC transactions but we don't want to go into this detail and we've partnered very closely with the team at stackos financials and they've accepted as as collateral in the world effectively provided liquidity to a market on Moro and together with with Julian at sta we've seeded this we've brought it live to the market and as of right now this is the the largest uh real world asset tokenized credit fund um in these rehabification transactions and we've actually just done the press release 15 minutes ago so this is really a world first yeah so how much leverage do you guys have how How many times do you lose? This question is actually a question to the vault creators um which is probably best addressed. So I think I checked.

I mean obviously it's super early. It will not be for everyone neither. So it's MF1 which is a tokenized product and uh I will let I will let you explain a bit more if needed but based on the F1 which is from Fazanara. So it's a I will let you explain as well but it's a priv we call it private credit in crypto. It's not p private credit only but let's say private credit product with a three months if you want to redeem three months and you can loop it on moro you can use it as collateral on moro and have leverage up to 85% LTV so that's great five times leverage so obviously if you do this without thinking you are in need it for a disaster because if you borrow at higher rate than what you're getting on the product you will blow up quite fast and you will lose a lot of money so that's why it took three months to make it in a safe way and there was a lot of urers to to accomplish.

Now to to the original question. I mean asset are only as risky as they are actually. I know for crypto it's I remember in 2020 there was a big war in me. Oh we want to accept USDC as collateral and alpha of mega was saying no USDC that's completely insane. It's super risky centralized.

Now who here think that USDC is risky those days. I mean if you are doing anything with stable coins most likely you are actually using USDC or USDT or another USDT is maybe a bit more risky but doesn't matter it's still now acceptable then there was a T bills T bills for for years people were telling me Seb you're crazy T bills are illquid and I was like what do you mean illquid the most liquid instrument in the world but from a crypto perspective it was like no I don't know where it lives it's is it even is the US government real come on it's a T bill it's safe so that was now accepted and now with Fazara and Midas we are moving to try to improve a bit more on the private credit and again there are I think five people borrowing already from it it's not a it's not a proof of concept it's actual people using their own money for their own profit motive for most of them I assume it's profit they are looking for uh and doing it to to to have a higher yield I may just add that the biggest problem we're ultimately solving for is this duration mismatch between DeFi and and real world. That's effectively what it all comes down to. If we were to bring the traditional fund which is just as Sebastian said a diversified source of yield, we have short duration private credit in there but we do so also have a digital asset sleeve. it it's built like an all weather fund but obviously in terms of the the actual fund it works for traditional LPS for insurance companies for pension funds to ensure that they get consistency of yield which is great but if you're lend looping obviously it's very different dynamics so been extremely fortunate to work with the Midas team and with stakehouse to come up with this token construct that allows you to have atomic liquidity as well as um liquidity which is um more normal with the fund.

So really investors and again having uh someone like Julian from stake now being one of the um the first in that is is a really great sign of the product um because it's designed specifically for DeFi and that's one of the unique parts of the offering. Yeah. If I can add on top of this alpha um well at say capital we've been looking um at those type of product structured product exotic product or what's how do you call it whatever u for a very long time and that's how we got involved in back then centrifuge and many different real asset projects and and I think um yeah as um as Dennis mentioned the the depth of liquidity in traditional finance is by order of magnitude maybe like three four uh bigger that what you find in defy. So if you are able to type into this market it's enormous um and but it's extremely complex and that's the reason it took like 3 months to build it correctly cuz you can actually build something very fast but you are almost guaranteed to end up on ve news. um doesn't say that we're not going to be undering off and renters.

I hope not. But the point being um yeah if you really do the things correctly then you can really find massive opportunity in traditional finance that you can bring in defy and then serve defy and now we seeing across different landing market more for a and etc that you have now retail people using mobile phone in order to just borrow capital on top of their bitcoin position rather than selling them like 10 years ago right u so this is the type of of uh products and uh and features that we bring into defy thanks to the understanding of treadfi and also with the experience of uh 10 years in the space and that's what we are capable of doing. So let's build on that. I'm curious to see what kind of I think risk considerations that you were looking at when you were considering same as you David and when you're choosing this product like what what what you went through and like okay this is a good product and then for you on your side Jillian from steakhouse side saying okay this is a good vault we're we're comfortable with this u well steakhouse is there uh state capital yeah sorry it's fine it's fine it's fine um well you can ask them uh we jumped u multiple times in the phone call because I really wanted to understand the risk. Um and yeah on my side it's very different.

And I think I really want to understand each single point of failure and also what's the so you might understand the risk but you also need to have exit strategy or if something happens do you have um uh shutdown u uh features for example the ability to only have the asset uh offchain and then only the operation whatsoever onchain off and onchain those different composibility are very important because this is how you can actually isolate uh your risk building a a product or structure product uh and saying there's no risk is impossible and in whatever you do in life there's always risk but what matters it's like in security you know in um like cyber security you never say something is 100% secure you always say it's secure because I understand the risk associated to that specific specific features and then you you take multiple different actions towards uh different scenarios and this is what brings security to that feature and it's the same in um in the product that we have built and that's the reason why I'm joining of of course also it's like when you invest in a product you don't actually invest in the idea people misconceptualize the concept of investing you invest in people and I think the reason is because uh people that have built this product are actually all experienced um professional like we've uh experienced before trade defy believe me but it exist uh and strong experience in thread fight. So they understand the tools, they understand the product, they understand the risk and they also have experience and strong experience of defy multiple years of experience. This is extremely important on our side. Yeah. I mean from from the underlying it's actually very simple what we wanted to ensure and it's an interesting point that Sebastian made.

So central banks have created this base rate liquidity environment to favor yield uh as well as minimum volatility. Now obviously tokenized money market funds were hot flavor of the month with rates being where they were. Now we're looking forward and we're saying like what will happen base rates go down. You know the the risk environment changes but then what happens if we go into a crypto bull market? How does that compare?

But what we really had to to figure out is what underlying RWA will give you consistency of yield but will do that whether you're in a bull or bare market and how can we also pair that with short duration credit assets and and that that's really we came down but even then still that's not sufficient and then that's where we had to work with Dennis and the stakehouse team at the token level um and with Julian at this to me at this so maybe Dennis can comment a bit more at the actual token level how we brought that to Um, of course, um, first of all, thank you for everyone for the for the for the for the contribution on on this. We we can also discuss more in detail later because we don't want to completely segre the the talk. I'm very respectful of that, of course, as well. And also um, thank you for the the staple summit in general. I think Julian, you have done such a big big thing moving the industry forward uh, over the last years.

When I went to the first stable summit in Paris uh, in 3 years ago, uh, the industry has changed so much. um um tokenized tables were novelty and now they are commoditized and and we we getting to the space where the industry is actually becoming um building real products um they're becoming very useful um so this is really a repo line on a on a on a private credit fund on all the private credit fund um um that um couple sourced from decentralized crypto markets we can discuss the details there but I think we've spent a lot of time there's a report that stakeholders published on on on those things and we can have a more balanced conversation in in the panel Yeah. So, moving forward on that, do you think, and this might be for Martin because you're also one of the OGs bringing real world assets on. Um, have the technical challenges of bringing real world assets on been solved? You know, is it now more so focused on financial or maybe it's educational uh user education?

Where do you think the the next pain point or issue is? I think definitely the ecosystem is maturing. So more and more traditional finance knowledge is moving onchain and building basically risk structures which are proven from traditional finance and just work better and faster on on novel technology. Uh and I I think you know when it comes to utility it's really what what's leading edge right now is really being better on the distribution side. So being more efficient how you have access to liquidity and manage liquidity.

Uh I think what you have built is is a a perfect example for that. uh really make it more accessible and bring basically uh traditional finance assets closer to what we consider crypto assets from a from a utility perspective if it comes to transferability if it comes to liquidation uh etc. uh and on the other hand I think uh that is where it's most likely at the end really I think everyone is everyone in the market is really thrilled by that but I think eventually what it needs is really also building structures which are order of magnitude more efficient if it comes to origination and asset management side and that is also already starting where I really see actually that we have you know block toa credit give can can I mention that as an example partner of centrifuge u they had built structure for managing basically credit right on chain and I think that is what you're also seeing evolving what we're also focusing on and they most likely need to go in both directions I think it's really rightfully focusing on distribution at the moment but in parallel also actually managing origination and managing assets onchain uh is something which is evolving which should happen in parallel because that's where basically the efficiency is coming from and combining both utilities I think uh what at the end will disrupt Treadfi and then really uh bring us to where we really believe uh we see the trillions on chain because it's not only uh faster but it's also actually order of magnitude more efficient. Do you feel that um this is a question for everybody that banks creating their own private blockchain like a private L2 is that something to be concerned about or is that something that's going to just you know increase the entire like RWA market? I simply that's experiments you know so hey no one is remember I'm a little bit older than maybe the average so there was some one thing called an extranet uh no one is using that anymore you know a private internet what the you know so hey and I think you will soon see now later do not discuss private blockchains uh or a kind of permission blockchains in the future it's more about I think there's a multiverse of blockchain still believe that uh even if there are will be blockchains will which will provide the security to uh kind of you know store value and have value transfer in in in in in size but for managing assets for different trading uh use cases and so on there will be most likely technical environments with a better utility than maybe Ethereum and that will happen you know and then it's I really think uh totally okay if an asset is managed and originated on one blockchain and distributed on another and traded on assert uh that is what I would most likely it's already happening I think you know so And uh it's also how we built the centrifuge protocol that you can basically independent pendant manage assets from distributing them uh basically do that on different chains.

Yeah, I I think uh those big institutions are looking at the current market uh cap on like co market cap and they see like 200 billions 100 billions and they're like what cannot be us you know and I think it's extremely difficult for someone internal of uh big institutions or big bank to actually understand the big picture. So they're like, "Okay, maybe we should build a blockchain because we've been here for a long time. We have the capital, we have the resources uh and we have some um developers or AI developers whatsoever and let's build a blockchain. uh but as uh correctly uh mentioned by Martin they will soon realize that it's something extremely complex to maintain and and also to actually have people using it because you need developers you need marketing you need ecosystem conference you need to know what's happening like for example if so general of big banks one of the largest bank in the world has strong difficulties to just issue their own stable coin across the market not even building their own blockchain it means a lot to the space So then they will soon realize that it's it's barely impossible to build something that can compete with AWS because they want to be a cloud manager. What about using them?

And that's the reality. It's too late for them. Um I'm quite surprised that they're still doing it because it was like Gak and it was like GP Morgan. They tried in the past it was like hyper or something uh not hyper chain. Um but yeah it those will happen uh more and more but uh it will be costly for them rather than joining like Ethereum ecosystem and then start building and issuing they can even like maybe start or play with some L2 but this is what it's uh happening now they they spend time criticizing it ignoring it and now they have to adopt it right it's it's a super hyperledger fabric I think you're talking about is hyperledger exactly back in the old days exactly and and just should build IP liquid or IP it works well.

Exactly. Yeah. And and if you think about what it does have some use cases is very much internal like Walmart for example used as a tracking use case but then just what we're talking about here in terms of fragmentation almost by definition liquidity is again fragmented. So and I think most I mean I don't hear anyone still wanting to do a private blockchain. I mean I don't think there is contour network that's the only last one that is getting some traction.

We don't know exactly how because it's I I never saw any block or any transaction. No one can see them if you're not part of the network. So it's difficult to know. But look, just recently JP Morgan launched a tokenized bank deposit on base. So that that tells you everything.

Dutch bank is trying to make an layer two on Ethereum. So they are on it for six, eight months. I mean I don't know why it is. Maybe it will succeed, maybe it will not. I think it was two parts.

one the big banks have a technical department that want to do technical stuff so why not build a chain and then they find out wait a minute if we build a chain no one will come because we didn't have a use case we didn't have a business then there is alo the compliance team saying well we need a own blockchain so we can control everything and so the compliance department is happy because the compliance department wants to have everything permissioned but you can already issue a token on a public blockchain which could be a equity token or whatn not and it's permissioned meaning you can only allow some people to use it. So you don't need to build a whole uh blockchain to achieve that you can achieve that already on any layer one. So those are more the compliance issue and then there is more people are now thinking well what is the business case because actually at the end of the day all those are private company or companies that need to have a profit profit at the end of the year and then they will figure out wait how having our own blockchain it will help us because what we want is and a lot of asset managers banks everyone is coming to blockchain to sell something to someone. So would you rather sell something on the blockchain you created that has no one or go where everyone is? You can see all the whales that are on Ethereum or Solana or on base.

You see activity, you see real usage. Why not selling to those people that are real people instead of selling to your own blockchain which is completely a go. So from a business perspective for me it's liquidity trumps everything. you everyone will go where liquidity is and activities because that's the most valuable set of any blockchain for and that is only happening if it's public. Yeah, exactly.

Absolutely. Yeah. Like the internet, you know, the internet was successful because everyone basically could talk to everyone and blockchain will only be successful when everyone can actually process data with everyone completely trustless independent from intermediaries and that needs a public blockchain. For me, there's only one answer. It's only a positive for the industry.

Whether these private blockchains are successful is a completely different question. Now, you can ask the same question about the utility about the countless L2s, L3s, and L4s we see in the industry. They might be private by banks, they might be by some VC backed startup. There's the same question that applies. But banks participating in the industry, it's only a net positive for the industry.

Why? Because a blockchain is nothing else than a decentralized ledger. Where are ledgers used? Well, ledgers hold checks and balances, assets and liabilities. And banks happen to be the biggest uses of ledgers.

They might be on Excel, they might be in different forms, but store of value and accounting value is the ultimate use case of ledgers. Therefore, having those guys participate in decentralized ledgers must is an essential thing. It's a really really important thing. Sebastian has highlighted JP Morgan doing a tokenized deposit deposits. It's the biggest news in industry.

It's huge. It's huge. It's massive. JP Morgan, Jamie Diamond two years ago blockchain. I mean remember his.

It's huge. Bitcoin 200k here we go. It's massive. It's very very positive. And if I just add another thing all those institutional thing where we are doing only permission stuff because we want KYCML all the way down.

If you look at black rockck be the main users I mean there are four users of the institutional version which is uh less costly which is a kit fund two are make are sky I think and one is etheina so two are decentralized stable coin which are completely permissioned uh on the back end so black rockck is not coming to create a product that is permission that no one will buy what they want at the end of the days is increase asset under management They are not here for to make proof of concept or to make PR announcement. They want to increase asset under management, get fees, get richer, which is how it should work and how we how we will scale. And that's why liquidity trumps everything. Very very successful, probably the the most profitable money market launched ever. 50 bips fee for uh 34 billion product in in a couple of months.

An incredible use case, a major positive for the industry. Um so very very good. and Black Rock just said they also did the the ETS with Bitcoin. It's a very simple product from their perspective. It's hugely profitable for them and it's a positive for the industry.

It's a very positive thing for the industry. Yeah. And and I would add to that, you know, I slightly disagree with them with Dennis's point about the tokenization. So I think there is a a use case there which is accessibility just to the point there because they've opened up that that money market fund to a whole new investor base and raised aum that they wouldn't been able to do that before. you know, it's not, for example, liquidity, which is what many people think, but accessibility, I think, is a is a very uh a good product market fit for tokenization.

And having direct access to the end customer, to the investor, which is novel for an asset manager like Black Rockck. All right, so we're out of time. I want to thank all the panelists, especially because I just threw out some random questions and we got some pretty key alpha. So, thank you [Applause]