The Internet Financial System A New Architecture for the Global Economy

Good afternoon. It's excellent to be here. Um I want to talk today about what we see as the emerging mainstream arrival of the internet financial system. Um when we think about this at a high level, we think about a world where the internet as a technology architecture, the internet as a software infrastructure layer, as a physical infrastructure layer is colliding with the global economic system. And in that world uh where we've started which is in blockchain digital assets crypto trading we're now moving into actually bringing the entirety of what we think of as the economic and financial system onchain.

So onchain payments more currencies coming onchain as a result onchain effects as a fundamental infrastructure and from that we're seeing treasury management the entire storage and movement of capital between people and firms moving onchain. uh we're seeing birth in onchain credit markets. Uh we're seeing the convergence of this with onchain AI agents that are intermediating activity and ultimately we think every layer of corporations, every layer of commercial and uh contracts is going to move on chain. And so it's this very deep collision of an internet native architecture with the global economic system. Now at Circle, we're we're really building this around three pillars.

Uh obviously USDC, which is a foundational pillar for us. We're at about 78 and a half billion USDC in circulation. We've uh we've handled almost 50 trillion dollars in onchain transactions with USDC life to date. but also these other two pillars. ARC which is in testnet which is an economic OS for the internet a layer one blockchain infrastructure which I'll talk more about and CPN which is creating a payment network infrastructure for financial institutions which is rapidly growing uh recently launched as well.

So the infrastructure layer, the digital asset layer and the payment application layer all working together. So our network, our core stablecoin network is growing strongly. Uh uh in in Q3 actually we reported that onchain transactions with USDC grew 6.8x year-over-year to nearly 10 trillion dollars of transactions onchain in Q3. And we've obviously continued to see very strong growth uh of large stable coins growing faster than any other stable coin in the world.

108% year-on-year growth with USDC. But we've also begun to work on very different parts of the infrastructure that's involved in in bringing the global economic system uh on onto the internet more natively and really at the center of that is our economic OS for the internet arc. uh and we deeply believe that just as we have operating systems for intelligence through AI, operating systems for mobility through mobile, for the web and cloud and others, we're seeing this operating system layer emerge for economic coordination and economic activity. Now that that's a base layer uh where digital assets can be deployed and issued where uh commercial contracts, financial contracts and economic coordination including governance and other activities can take place and then building up from there are obviously digital assets that circle issues USDC EURC but already we're seeing uh a significant number of local stable coins that are being issued on ARC. And so these are stable coins from emerging markets from developed markets and we're building up an infrastructure for stablecoin FX and we expect more and more currencies to operate on these layers.

Uh on top of that our tokenization more broadly. So you have the the cash layer but tokenization more broadly takes advantage of that underlying infrastructure takes advantage of liquidity for all these cash layers and then starts to tokenize other forms of assets. So, we issue USYC, which is one of the fastest growing tokenized uh money market fund products, uh around a billion dollars in in circulation today. But we're we're seeing many many other asset issuers coming onto this infrastructure to issue tokenized equities, tokenized commodities, uh tokenized uh funds of of other sorts. And then on top of that, we're committed to making sure that every asset that's issued on this infrastructure is widely interoperable with the rest of the blockchain ecosystem.

We do that through CCTP, which is uh today accounts for more than 50% of all cross-chain traffic amongst all assets on all blockchains. And then we work obviously alongside other interoperability protocols. I want to take a moment though to to you know we're we've often you know focused on sort of tokenization the digital asset space etc and what we believe looking 3 to five years out where we see a significant amount of the engines of economic activity to come from and um in in our view we're entering this age of intelligence and we're entering an age where AI agents and machines will dramatically automate more work more tasks more production and that that explosion in agentic activity. Again, if you take a threeyear, foury year, fiveyear view, a world where there are potentially hundreds of millions or billions of agents that are continuously working on our behalf for our corporations, for ourselves, um that that agentic economic environment is going to foster a huge acceleration of activity in the economy and a huge acceleration in the demands that we have in our economic and financial infrastructure. And that's where I see this incredible convergence taking place.

AI platforms are becoming operating systems for intelligence and the application of intelligence broadly in the execution of work and production. Blockchain platforms are emerging as operating systems for economic activity. We think about this as on the one hand the AI platforms as the nervous system, the information and data and nervous system of the global economic system. And we think about these economic operating systems as the circulatory system of the internet economy as well. And these two increasingly are going to be connected very very deeply and work very closely together.

And in that world, this is a world where millions of businesses come on chain, where there are enormous numbers of agents that are executing on work on behalf of those corporations and connecting people and devices in the billions around the world. Now, we talk about this idea of of economic oss and we we have this uh framework from mobile like an app store and and applications on on the web or applications on mobile devices or applications in the cloud. uh we're now starting to see killer apps emerge in AI. The applications that are going to be built on top of these economic oss span a very broad range of what happens in the real economy whether that's uh credit applications uh you know trading applications which we're all very very familiar with increasingly the storage and orchestration and movement of value in terms of treasury management FX applications um you know stored value products all around the world that enable that to work seamlessly um and then ultimately connections all the way down into the the the environment where businesses are actually transacting with customers uh around the world. So each of these represent application categories.

These are going to be natively built uh initiated, executed and built uh on these new environments. And I think we'll see uh in the you know products that have in the past been built on classical software models and centralized systems moving entirely to these new economic operating systems using native digital currency uh and and a broader range of tokenization. In this initiative that we've been working on when we launched ARC in uh uh test net uh very recently we were very privileged to have many of the world's leading companies in the financial sector in technology in AI in commerce joining us. So many of the world's largest asset managers, the largest private credit funds, the largest global systemically important banks from all around the world, including banks here in the region, uh leading tech platforms, fintech platforms, consumer platforms, the largest payment networks in the world, and obviously the most important players in the digital asset ecosystem are all actively engaging and working with us on ARC and and and building integrations to ultimately support this new economic operating system and this transformation of the financial system onto the internet more natively. So we're as I like to say we're really just at the beginning.

Uh when we when we started circle uh 12 13 years ago my own belief was that the transformation that would come from this new infrastructure layer of the internet would unfold over 10 to 20 years. And at at the ultimate uh uh kind of point, you know, 10, 15, 20 years into that future that we would actually see uh you know, the entirety of of what we think of as the global financial and economic system moving more natively onto the internet. We're 12 years in. We're making very good progress. U but I would conclude by saying we're just at the beginning.

We're we're we're moving from the early adopter and speculative stage of this market into the mainstream scaling phase. The technolog is ready, the regulations are ready, the major companies that build in the space are ready, and we're thrilled to be able to work with so many of you as we build towards this new internet financial system in the future. Thank you.