The Future of Money - EP 19 Zach Abrams

What is the thing like as you started the company, what's like the, the thing that you didn't do before that you now do and you realize you like the most?

Oh God, now you're interviewing me. I mean, I, I never had to run a business, you know, and I guess part of that's miserable and is a ton of work, but part of it's really fun. The biggest thing about this whole thing, I think, is I'm like competitive and I played competitive sports growing up and I've never really, I've been like entrepreneurial about my career and that I would write books outside of work and work on movies. But, but this was like, oh, I'm in a game and like now I want to win.

It feels so, so it feels different from writing a book and like book doesn't feel as entrepreneurial. It feels more creative or something.

It does feel sort of entrepreneurial in the, I always thought of each book or documentary, it is it actually made me have more respect and a, I think, a better understanding of like the people I was covering because they are like little startups in and of themselves. But, you know, they're going to be kind of finite. But yet there's always ups and downs and there's like things collapsing and things you have to fix. And it's this journey. And so, so in that sense, but not in the like, there's money coming in and there's money going out and like You know, and I have to make this work. And I think when you write a book, you're like, I have to make this work, but I feel pretty confident in my skills.

And yeah.

And I feel like there's so much in my control, whereas on this, it's like, I think I could do my absolute best stuff and I still don't know fully if it's gonna pan out, you know?

Yeah. No, I've been there.

Yeah.

Maybe I'm still there.

Um, all right. Well, I'll do, so I don't do a crazy long intro or anything, but we can jump in if you're ready.

Yeah.

Zach Abrams, thank you for coming to the Pods, dude.

Excited to be here. Thank you for having me.

I'm going to try to introduce you, and if I miss anything, help me out. But, um, you're the CEO of Bridge. Stripe acquired Bridge, well, last year it began, and I think it closed this year for $1 billion, and the company was only a couple years old. You're a longtime executive in the, the fintech space. You've done startups, you've worked for Square, other big companies, and then, and then, yeah, created this, this rocket ship. And, and we're going to I don't want to freak my listeners out because I'm not— I don't do a lot. And I know crypto is not really the full right phrase here, but I don't do a lot of fintech stuff. And you guys are doing stablecoins. I pretty much had to learn actually what a stablecoin is doing research for this episode. So but I thought this was a good opportunity because I think, you know, we try to make this accessible to a pretty wide audience. So if I don't want people to get freaked out if they're not in fintech, because I think we're about to learn about the future of money, what this stuff is, where it's all heading. And I know we had a brief chat a couple of months ago and that was already like pretty illuminating for me.

So yeah, definitely. And it's a lot simpler than rockets and artificial wombs and all the other things that you normally talk about.

We'll see. We'll see. Just before we kick off, really briefly, I want to thank E1 Ventures for helping make this possible and give us some support. Very short little read there. And with that, okay, we're off and running. Where to begin? Well, okay, let's, let's do, let's do a little like explainer history lesson type thing on what a stablecoin is.

Yeah. A stablecoin is a tokenized form of a dollar. So you take a dollar, like a US dollar for instance, and you put it into a bank account. And then you create a digital representation of that dollar that other people can have. And that's the extent of it.

And unlike crypto, which often feels psychotic and full of risk and insanity, I mean, these are backed by like T-bills essentially, right?

Yeah, exactly. They're pegged to the US dollar and backed by, you know, US dollars or short-term treasuries. So not even long-term treasuries. They're, they're, you know, technically speaking, you know, safer than even a bank deposit because, you know, your bank deposits are backed by loans and so on. The stablecoin itself is, you know, one for one backed by cash and short-term treasuries.

So you're trying to create this digital future of money type technology that has the stability of the financial system, behind it, but more flexibility than what the traditional financial system is doing.

Yeah, exactly. It, it, it gives you the ability to hold and have a US dollar, but then gives you the capabilities of having, you know, a, a digital type of asset. And so that means that it's more easily transfer— transferable, it's more accessible, it can be stored in pretty much any country. It can be custodied by someone else, or it could be self-custodied. It can be programmed. There's a lot of benefits that come with taking this sort of analog asset and digitizing it.

What do you, how far back do, does this idea go?

Well, like, you know, most things in, in the crypto world, it's, it starts with trading. And, and the first, you know, large-scale stablecoin was Tether. Which was launched, I believe in 2017 or so. And it was basically launched by an exchange, Bitfinex, that really struggled to get access to the US banking system. And folks were trying to trade Bitcoin or ETH or other assets, and they wanted to settle those trades in, you know, US dollar equivalents because you don't always want to be risk on, for instance, and buying more and more Bitcoin and so and, and so they created this digital version of a dollar to enable someone with Bitcoin to trade into a tokenized dollar and so on. And then USDC launched in 2019, and, uh, this is when I was my last year at Coinbase. And so Circle and Coinbase came together to launch that version of, uh, of a stablecoin. That was the first version that was really regulated in the US., and then from there things have kind of slowly and then suddenly scaled.

So you're— because you were at Coinbase and because you've been in fintech for so long, you're paying attention to all this stuff and just getting interested in it, watching what's going on.

Yeah, exactly. We— when the last year I was at Coinbase, we launched this and I was running the consumer business there. And our idea was to take USDC and use it to help Coinbase expand internationally and basically transform Coinbase from this trading application primarily based in the US and move to being a like global neobank built on top of stablecoins because anyone in the world could hold this dollar format on top of which, you know, you could, you could also offer trading, but you could settle into local currency, you could issue cards on top of it. And so we had this idea, we had this idea then, and it kind of stuck in my head. And it took a couple years for it to sort of turn into the, the what became of Bridge. But, but it, but it mostly started then.

When you, you started Bridge in 2023?

Exactly.

And it actually started as like an NFT type thing.

Yeah, exactly. Which was a terrible idea.

Was it, was it a, was it a novel take on NFTs or you're, you're trying to make a marketplace or?

It was so, so Sean and I were, I've just always really been interested in money. And, you know, Sean and I actually started another company, you know, back in 2012 that was a fintech company. And then I, you know, joined Square. It was just— and it wasn't like I always wanted to go. I was just drawn towards, you know, fintech money movement things for whatever reason. And so when Sean and I were both ready to start another company, we were naturally drawn towards financial services and are— my belief, having, you know, reflected on a lot of the time in fintech was, you know, people talk about platform shifts, you know, like right now AI is like the big platform shift. And before that there was the internet and mobile and, and cloud and so on. And but, but, you know, these platform shifts are talked about like they're universal, you know, like the one platform platform shift impacts all industries equally, which is not really the case. Like mobile, for instance, had almost no impact on financial services. And one of, you know, in terms of like rearranging the top 100 companies and so on. And one of my reflections was that all of the big fintechs were basically card companies. Stripe was a card company and Square was a card company and Adyen was a card company and Revolut started as a card company and Nubank started as a card company. And cards were actually this huge platform shift that really changed who was important and rearranged value and created all this opportunity for new startups to come in in the financial services space. And our view at the time was that stablecoins could be the next platform after cards and this new core medium on top of which all this new financial infrastructure could get could get built. And that was our belief. But we didn't really know exactly how and what was going to be built on top of this new platform. And so, you know, the first version of that was like taking dollars, converting them in stablecoins to buy NFTs, because at the time NFTs were really taking off. And then by the time that we had raised money and that we had built some version of a product, there were like 90 other companies that were basically doing the same thing. And we realized that that take was going to be really competitive and honestly not, not very interesting. And so we very quickly pivoted from that, you know, maybe a month after we, after we had raised money.

Yeah. I like the quick pivot. It's amazing. I still have this NFT idea. You could tell me if you think it's terrible. Um, like during the height of the craze, I too was like, how can I capitalize on this? And I, I was just thinking, Please, I'm sure there's flaws to this, um, but there are probably none. You know, I was thinking like with first, first edition books are always a thing. And I was like, oh man, I could give somebody like the actual Word file. You know, you could have the, the real first edition and, and then you run into these problems where you don't actually want to give someone the whole file because I'm sure HarperCollins or Penguin would hate it if they just started printing my book. Um, but I was thinking like, oh, if you could give like the first page and you have, but you have the digital first page. I still feel like this is a unique thing that the physical world cannot replicate.

I agree. I think that there is an immense market for digital scarcity or creating digital scarcity. And, you know, you see this, like, I'm, I'm optimistic about digital art. I know that it's sort of, you know, there are strong opinions and a bunch of different, a bunch of different camps, but I have a lot of friends who collect the art and for the same reasons why physical art is interesting, digital art is very is very interesting as well. And, and, and I think the same thing is true here. You know, you take a, you take a book and you can digitize it and create scarcity and, and then people can, you know, collect and, and, and, and assign the same either emotional value to, to that good because it is like, it is scarce, you know, and it shows your investment behind it or, or, or, or invest in it because they think it's going to be worth more.

Yeah, because, well, in a first edition run, I mean, they're printing tens of thousands of books if you're doing things right, I guess. Um, and with the Word file, I don't know. I mean, there really is only one where I produced this thing. I kept picturing someone would buy it and they could put it in like a photo frame that was illuminated or something like that. Like a digitized—

Yeah. I mean, I have a, I have a good friend who has, uh, all, you know, Beeple art and, you know, all over his house, you know, and, and, and Beeple actually has a I think it is like a physical space in South Carolina where you can, you know, buy his digital art and then like physically print it. So you own both the digital and the physical and it's kind of like an interesting way of printing it. But you could do the same thing with the, with the book. I mean, I think like a lot of things in crypto, there's a really interesting and valuable belief underpinning the implementation of it. And then you know, in the tree, you know, the, the tree of ways in which that idea could be implemented, the crypto world chooses to go down the thinnest, gnarliest, most insane branch possible. Right. And, uh, in, in this case, the world will probably come around to, to, to a more sane implementation.

Yeah. I will drop this in a second, but I was, I was competing, I guess this was mass NFT hysteria and the Bored Apes were just taking off and I was talking to the OpenSea guys about my idea and they were like too busy to help very much with it, but they, they seemed semi-interested. They're like, but you got to get attention for it. And, and I was like, okay, what if we, what if I like send the actual book to space on a rocket or we like burn? I had, um, I have like these galleys, these early copies you get. And I think I have like the last, I don't know, 10 or 12 of them. I was like, what if I put those on a rocket test stand, and we have the rocket engine like burn them out of existence. And then this digital file is like the last, the last sort of early copy.

That's awesome. Yeah. And then, and then you could take the video of them burning.

That's what we were going to do. And then we're going to sell that.

Exactly.

That was going to be part of the package. You got the video and the, and the book. I should have done this.

Yeah. Yeah. It's amazing. I mean, I think I, I do think there is a lot of A lot of, there's like a there, there, you know, and it needs, there's, there's going to be a right place in time where that is made more mainstream. Okay.

All right. All right. So, okay.

You were just ahead of your time.

Or I missed, I missed like the one moment where I could have made more money than I ever will selling books off of like a publicity stunt. Um, well, time will tell. Um, So you, you guys switch in, in a month. You, I mean, that's pretty good to sort of feel, realize you've changed course, although it must be weird. You've already raised money and now you got to go back and, uh, it was, it was actually awful.

It was, yeah, yeah. There was nothing good about that. We, we, we raised money and, uh, yeah, so, so we, we raised money and we raised like a pretty decent amount of money and and then we're building this thing and we had hired people actually, and they were helping us build, build this version of the product. And then I, I basically just lost confidence in it completely. And, and Sean had not. And so this was like the hardest struggle we have— we had as co-founders. And eventually, you know, I had like kind of convinced him to move off it. But, but he really wanted to just like launch a first version and iterate from from that, from that place. And my view was that we were, you know, we were, we were building in like completely, you know, the wrong direction. So, you know, if you drill a well, you know, an oil well in like the completely wrong location, there's no amount of iterating around that location that's going to produce oil. And, and, and, but this kept me up at night because I believed that, you know, all these investors, all these people had like put faith in us to do this. And then actually I called one of our investors, our biggest investor, and I called him and this is after like weeks of like not sleeping and struggling with this pivot decision. I called him and he picks up the phone and I was like, hey, I have to like tell you that, you know, this like idea that we had, I kind of like lost confidence in it and, you know, we're going to pivot and, you know, and then he, he is like, hmm, mm-hmm. He's like, oh, I thought that idea was terrible anyway. And I was like, oh, why didn't you tell me that? She was like, oh, you seemed excited about it, but I'm glad you moved on. And if you find another idea in a year, that would be great. And I was like, oh my God, I put all this pressure on myself. And, you know, I was all completely manufactured.

So they, they just like, they had confidence in you. They like, they liked you guys.

I guess so. That's what I learned in hindsight. I thought that it was all the idea.

Okay. So you, you guys do change and then, I mean, your investors have to be pretty happy because 2 years after you changed, you're, you're selling the company for $1 billion.

Yeah, exactly. We, we, we took a bit of time to find what became the current implementation of, of Bridge and probably around October or so we started building that version. But, you know, it wasn't like a straight path from that to a straight path from that to selling to Stripe. It's not like we found that idea and then it was like, oh, this is clearly clearly the thing. We started building, building our first version of the first version of the product. And then actually our bank partner dropped us and then we started building another version of the product and we were about to launch like we were all in San Francisco. We had all because we were remote at the time, we had all come back to San Francisco to launch and we were like, you know, working 24/7 to get things ready with this very first customer. And the day that they were supposed to launch on a Monday, and on Sunday the FTX meltdown happened. And so then, you know, basically by Monday morning everything had completely blown up. And by Monday afternoon that bank partner had dropped us. And then we started building again. And then the next bank partner dropped us again, you know, which was, which was Signature. And, and then finally we found a new bank partner. We rebuilt the whole platform, found a totally new, new new customers. We then launched around, I think it was like late March, and that's when— the week we launched was the week that SVB collapsed. And then USDC, which was like the only regulated stablecoin, depegged. And, you know, I basically spent Thursday, Friday just trying to scramble and move our money around because we had a bunch of money in SVB and we were, you know, and then we had like basically moved our money and we felt like we were so smart. And then, and because we just didn't have any capital at risk. And then I remember calling Sean on Friday and was like, you know, oh my gosh, like, this is like, you know, we save like our money, but like the company, you know, who's going to want stablecoins on Monday? And then, and then Taylor, my wife and I, we went to dinner and we, you know, she was like, so do you think you have a company on Monday? And I was like, I don't. I think so. I mean, and, and, and basically Sean and I were kind of like emotionally getting ready. And then Monday came around and all of the developers who were building on our platform came back and were just moving as much money as before. And, and then that was clearly the nature of the company. And then from there we were just, you know, slowly building back and back and back.

I was going to say, I mean, you've been through the gauntlet already. I mean, yeah, it's hard to imagine worse.

It's not. Well, you know, you talk to a lot of space companies, so it's like not not terribly dissimilar from like the rocket blowing up.

Yeah. I mean, there's two versions. There's one, the rocket blows up and then the extra bad one is where it comes back on the pad and you lose both the rocket and all the infrastructure that you spent your money on.

Yeah, I guess we kind of had both, but, but at a much smaller scale because the, the, the, the rocket blew up like FTX and then it came down and blew up our bank.

Every time I've been to one of these first launches, it's It's like they just wanted to clear the pad and get far enough out. And I have, I have actually been at one where it came back on the pad.

Oh no.

Oh no. Very bad.

Oh no.

Much sadness. All right. Well, okay. I mean, so the, we'll kind of get to more of the journey, I think, by maybe trying to explain how this technology works. Just when we were having lunch, when you started describing how customers actually use this, it was really helpful for me. And just having been to, I remember we were talking about Nigeria, I think. And having been there myself, I mean, it's, it's the financial system's a little crazy. Everybody's paying for everything with their cell phone numbers. But then if you were trying to think about doing any kind of international transfer, moving naira, um, you have Nigerians all over the world who are doing these remittances, trying to send money back to their families. And, and that's a crazy process. I spent a lot of time in Mexico. It's the same. Sort of thing. Can you explain to me how a stablecoin works in this particular case? And I think it'll help people get their head around this.

Yeah, there are, there are two general areas where stablecoins are clearly working, scaling, have a large-scale product-market fit. The first is moving money across borders. And I can go into a bunch of use cases where, where we do that in many different permutations, you know, in Nigeria or Mexico. And then the second is Stablecoins as this global financial building block on top of which you can build one scaled, you know, fintech experience. And I'll, and I'll talk about that one in more detail too. The, so on the first one, moving money across borders, we see that in every way. So, you know, we, we have customers like Scale.AI who need to pay people out, uh, you know, they're doing data labeling all over the world.. And those people could be in Argentina, they could be in Nigeria, they could be in India, they could be in a ton of different countries. Generally, those folks are getting paid, you know, 10 cents or 50 cents or whatever to, to data label, scale prices, all the tasks in dollars. And then 2 times a week, every Tuesday, Friday, they pay all those people out. And it would be very hard to do this with fiat because it's very hard and very expensive, especially to send, very small sums of money to lots and lots of different people just because of the fees. Just because the fees. Yeah. You know, you're, you're paying a large amount of fixed fees and a large amount of variable fees. We also support something similar for the US government where we're dispersing aid payments across LATAM. And they told us that before stablecoins, about $0.60 of every dollar was getting to the end recipient, and now about $0.99 of every dollar is getting to the end recipient. So, you know, 50% increase in the efficacy of the dollars that they're, that they're distributing. And then we see, you know, in a, another way, we see SpaceX as a customer of ours. SpaceX is selling Starlink all over the world, and they're collecting local payments in all these different countries. And it's oftentimes hard to get money back to the US, uh, from all these different countries. So they will take local currency through us, convert that into stablecoins, and bring it back to to the US. And then we see stablecoins used as a transmission layer to move money across borders. So you might take money in US dollars, convert it into a stablecoin, move it into Mexico, and then convert it into Mexican peso. And there's customers like Felix Pago that are building fiat-to-fiat cross-border payments for, you know, for basically remit, mostly remittances. And they are doing that all using a stablecoin rail. And so every different way in which money can move, you're taking a stablecoin in and you're paying it out. You're taking a dollar and you're sending a stablecoin elsewhere. You're using a stablecoin as a transmission leg. But so many aspects of moving money across borders is very broken. And one way to think about it is like every country has its own file format of money. And, you know, whenever you have to convert between file formats, it's this really broken experience that's sort of been cobbled together through decades of, you know, hot fixes at banks. And stablecoins are the first universal file format for money. So you can actually store the first time, you know, you can store this one asset type in all these different, all these different countries. And then so people are using that to move money in all these, all these really interesting ways.

And I mean, I cover— I'm decently tech savvy. I cover technology even though fintech hasn't always been my thing. I mean, I get like— I just— I'm just professing my ignorance. I mean, when I first started hearing about stablecoins, it was just like, oh, this is some crypto thing. It's probably just got all the same, you know, usual baggage that that brings with it. And then when, you know, is that— I don't even know if that's something you have to overcome because the other people are more savvy than I am that you're dealing with.

No, no, no, no, no. I mean, I mean, we, we are for a long time there's, there's been, you know, we're, we're just lumped into the crypto bucket and the crypto bucket is, you know, miasma. Yeah. Yeah. Hell yeah, exactly. And that's why it was so hard to find bank partners and it's so hard to explain to people what we do. You know, the, the first, the the, you know, when we would talk to people, oh, we're moving money with stablecoins, the first thing that people would think is, oh, the only reason why you're doing that is because someone is trying to move money outside the core financial system. And the only reason why they try to do that is because they're money laundering. You know, it's kind of like messaging of not that, you know, 5 years ago or 10 years ago, the only reason why you'd want to encrypt a message is because you're trying to do something terrible. The only reason you tried to use a digital asset is because you're trying to do something that, and we're just lumped into, into that bucket. So it's taken an enormous amount of work for us to claw our way back to neutral, let alone get to some positive territory.

Like, what is the— if I'm SpaceX and I'm doing these large volumes of transactions, and at some point this money is in the stablecoin and not in my hands or not in some US Bank that I've just been around for decades. What is it like? What is the highest risk? I mean, since this is tied to Treasuries and it seems kind of low, I mean, the whole— it would be the same risk as the whole financial system would have to be kind of cratering in some horrible way.

Exactly. I mean, I mean, the largest risk to a stablecoin is the banks. And this is what happened with SVB, is that Circle held some percentage of its cash with SVB. And SVB went under. So there was questions around whether Circle was going to have all the collateral to back USDC. And, and, but, but nobody had questions over all about all the reserves that were held in Treasuries or what have you. So actually the weakest point of a stablecoin, the highest risk point of a stablecoin is the dollars held in a bank account.

Okay.

And then Okay.

And so what did you guys— okay, so you have to overcome this. You have this new financial mechanism. You were not the first with a stablecoin. Like, what did you guys figure out that other people hadn't to be able to go to get Stripe to buy you after 2 years?

We, we thought that stablecoins, this belief that stablecoins would be a core new platform shift in money was very contrarian. And, you know, stablecoins were thought of as an asset that people used to trade, you know, Bitcoin or something. But being a core part of the regulated financial system, a medium through which, you know, large sums of money move, you know, cross-border, a platform on top of which the next generation of fintechs were built, people didn't think that at all at the time. You know, our company had two core premises. One was that stablecoins would be important, which at the time was very contrarian. And then, and then two was that there would be a lot of them, which was also very, very contrarian. And now both of them are, you know, more likely to come true. But that was it. And at the time we were, you know, the Venn diagram of, of people who of people who like know and believe in, you know, or know and like really understand the regulated financial system and understand the crypto world was like zero, right? Because the crypto world had attracted like a certain audience. And then the— and then all the folks who were in core fintechs were kind of like shunning the crypto world for a long time. And so since we sort of sat at that intersection, that gave us a very unique advantage.

And you guys had to— what, you had to go to SpaceX or a SCaLE and then just convince them to give it a try and they just do that enough times and keep moving larger volumes?

No, it was— it is like, you know, probably the most like fortunate thing that's happened to us is that, is that so much of this space is shaped by people in the US. And the stablecoins that are, you know, all the stablecoin infrastructure is built in the US, maintained by US companies. You know, we're a US company, but all of the product market fit for stablecoins is outside the US. And so we built these APIs and we actually, you know, we started the company with these two premises. We believe that stablecoins would be this new, you know, payment platform on top of which a bunch of new stuff would get built. But we did not start the company because we believed that we were going to solve this specific problem for this specific user. So we actually didn't know who to go after. And then when we launched our APIs, we actually had just ever since the beginning this steady flow of inbound interest because there's been so much pent-up demand outside the US to use stablecoins for cross-border payments, for, you know, fintech applications and so on. And it's just been, been completely unmet. And so we feel, you know, I mean, I would basically at the beginning of the company, I would like, tweet that was like, hello world, please someone, we have these APIs and we'd get like, you know, 5 or 6 people who would inbound with like very interesting cross-border payment use cases and so on. And actually that's how the government use case, the government payouts use case came to us. It was an inbound. They were looking for some way of dispersing this aid and they knew that if they didn't disburse this aid by the end of the year, they just lose it. So they were like very desperate. And, and so they found out about us. They reached out to us. We were like, there's no way this is real. And then they sent us a Citrix, you know, meeting invite. And that was like, okay, maybe this is actually because who else in the world uses Citrix? And then we, and then we, and then we got on the call and there was literally like paid, there was like 50 people, you know, on the call and every, you know, and, and, and, you know, they were like, and then we're like, oh, this is actually serious. They like, and we were 3 people, you know.

Yeah.

So that's been the story of the company since the very beginning.

We needed to make like virtual employees.

Yes, exactly. Exactly.

Uh, so like to wrap my head around your, what the traditional competition is. So I'm not doing corporate scale stuff, but if I'm, I use Wise to pay people in Mexico. Um, we're building a house there and I don't know. I don't think I'm in any trouble for the things I was doing, just paying contractors to do work and using Wise to send that. And then obviously you always have to pay a fee with every transaction. It's not horrendous, although it's been going up and up and up all the time. And so would I— is it— does it make sense for somebody like me to be doing this a different way, or it makes more sense if I'm a a corporation or a government or—

Well, we— it probably wouldn't make sense for you to use Bridge because we serve developers. So then we might serve Wise if Wise wanted to build using our APIs to better serve the Mexican corridor. Like we, we serve a customer called Felix Pago, which is built, you know, just focused on US-Mexico remittances, which is the most competitive, the largest and most competitive remittance corridor in the world. So they're going head to head with Wise and Remitly and, you know, all the usual folks. And they— their advantage is that they're using stablecoin rails to, to build this infrastructure that all these other companies have built over the last decade. And through those rails, you can serve folks way more cheaply. And, you know, the remittances sort of cases, there's, there's like 3 segments of the market. There's a consumer market which, which is, you know, Wise is with stablecoins, you can probably be half as expensive. So it's meaningful, but not like crazy. And then there's the enterprise market, which is like, you know, Coca-Cola moving money between Mexico and the US. That's like super cheap. You know, there's no room for stablecoins there today. And then there's the middle area, which is B2B payments between, you know, cross-border, which is a very broken segment of the market, costs hundreds of basis points. People are using SWIFT. It takes days. That's where we saw the most immediate product market fit is all these companies in LATAM, the Zulus, the Rios, the Bitzos of the world, all coming to us to serve the B2B market because they were clamoring for a different way of moving money cross-border.

Like, why is that part so broken? I know you were talking about the file formats, but all those fees are just from moving one currency, trying to— on this journey to another, and people are just handing it off to each other through these different systems and all taking a cut or—

it kind of— so, so the way, you know, the, the way a lot of payment problems are papered over in the world, like in the US and definitely across border, is basically by, by people just, you know, storing balances in those different, in those different corridors. So, so Wise was probably the first major company to do this, I think. But, but basically Wise holds a bunch of money in Mexico and they hold a bunch of money in the US. And so when you send money in the US, They collect it in the US through a local payment rail, and then they just pay out immediately from their balance in Mexico. So money doesn't actually move because moving money is super slow. So they're, so they're basically using their own capital to circumvent actually needing to move money because the existing, whenever you have to switch between file formats, it's never going to be a good customer experience. And, uh, the issue with that is that you have to hold money in both corridors and, and that model does not work for for big chunky payments like B2B payments. And so those models have really scaled and gotten tons of adoption with consumers and they've scaled up to some B2B segments, but, but generally really low. And so as a result, the B2B segment has been stuck actually having to physically move money between corridors. It was the hardest problem, hardest problem to solve. And so in often cases you were paying 300 basis points or 400 basis points to move money Okay.

And now that you guys have had success, you've been bought for a billion dollars. I know I've mentioned that a couple of times. I think that needs a little celebration. So the traditional financial people must, they've paid attention. I, did I not see JP Morgan and some, some other heavyweights have decided that they would also like to play in the stablecoin arena?

Is that— I mean, I think that everyone— I think that everyone's going to want to— everyone who moves meaningful amounts of money or is a meaningful financial services infrastructure player is going to want to do something in stablecoins. A lot of the banks now are thinking about issuing stablecoins.. I think that every fintech is going to build services on top of stablecoins. I think even a lot of card companies are going to be issuing cards on top of stablecoins. I— it's just a better way to deliver financial services globally.

So what do you guys do? I mean, when you say a card company, what do you— what do you mean by that?

Well, we just launched— so stablecoins are this global financial building block. And before stablecoins, if you wanted to to serve the US consumer, the US market, you would have a US bank and then maybe a US BIN sponsor for cards to, to, to basically serve the US market. And then if you wanted to go to Mexico, you would have to get— do it all over again, a Mexican bank and a Mexican BIN sponsor. And then in the UK you do it all over again. In Europe you do it all over again. And this is what made international expansion so hard, like why Chime is basically in the US or why Nubank is basically just in, just in Brazil. It's very hard for a financial services company to expand and into a bunch of different countries. And stablecoins create this one store of value that you can build on top of and deliver a financial service to 90, 100 different countries. And so you could build a balance on top of stablecoins and you could enable people to store a balance and then do local payments and then even issue a card on top of those stablecoins.

Like, you mean like, I'm sorry if this is so like a credit card.

Okay.

Well, usually you said Stripe was a card company. You were listing some earlier.

I don't know.

I just never thought of them quite like that.

Okay. Yeah, yeah, yeah, yeah, yeah. And so, and so, so that's what's possible. So we see, we see anyway. So we launched a partnership with, with Ramp where Ramp issues cards primarily for US businesses, but it's hard for them to issue cards internationally. They're going to partner with us to issue cards to businesses globally. On top of a stablecoin balance. So if you're a Mexican business, you would fund your Ramp balance with MXN, we would settle it in stablecoins, then they could issue a card on top of it, and then you could use the Ramp platform to manage all your company spend.

And so as this takes off, I mean, now you're part of Stripe, massive financial organization. You guys are all smart and creative. I don't know. I mean, so where are the levers to compete here? Is this— you got— is end up fighting over fees and some innovative services, or—

I think that— well, I think that card— you mean how do we compete with card companies?

No, no, I'm sorry. Like, since you've established stablecoins, is this a legit thing? And the traditional players are coming in and like you said, you think this will be the basis for all kinds of stuff. It's like, yeah, where, where are the battles to be fought and won if everybody is starting to move this way?

Oh man, I think that there's a lot. I mean, right now the space is, is attracting a lot of attention. I think there's— and there's a lot of questions around how the space is going to unfold. Like, just take stablecoins themselves. You know, you have a lot of different companies who want to issue stablecoins in a lot of different ways. So you have USDC that wants to sort of be the one global standard through which, you know, everyone handles, you know, stable— you know, the one dominant stablecoin to rule them all. Then you have a company like, like Bridge where we want to issue stablecoins for everyone. So we have a very diametrically opposed, opposed view of the way the market could play out with, you know, tons of companies having and managing their own stablecoins. And then you have folks like Paxos who are somewhere in the middle where they're issuing new stablecoins but bringing together consortiums of people. And then if you think about stablecoins as a financial asset, there there, it's really this amazing tool because before stablecoin, you basically, you know, you had a dollar and you could either put it into a savings account or put it into a checking account. You know, you had to pick what you wanted to do with a dollar. You either saved it or you spend it. And so a stablecoin, one of the amazing benefits of it is you can take this asset and save it and then get a transactional asset that you can spend. So you can actually get access to both attributes of a dollar in the same format. But if people primarily just want the yield, there's also tokenized treasuries and other ways of accessing the yield. So there's even competition of like what the format will be to access some of the underlying, underlying benefits and tokenized money market funds. So just even in the stablecoin itself, the market is incredibly nascent. Like we, we, you know, the Genius Act is making its way through Congress and the markets are just kind of figuring out. Out what the most efficient outcome will be and what most people will want to build on top of.

The bank— I mean, the— it's kind of— I mean, I know the financial system is rigid and it's probably— it's sort of like a good thing in some ways that it's so hard to, you know, all these mechanisms get put in place. But I mean, there must be— it's kind of crazy to me that you guys pulled off what you did pull off in such a short amount of time because it illuminates that there was, just like this immense amount of friction. And, and, and then I would think the traditional players must be very— I'm sure it was a lot of work. You kind of made it look relatively easy, you know what I mean? To, to, to like change the system.

Yeah. Yeah. I mean, I think the, the other thing that we really benefited from, which is not, which is, which is somewhat similar to what a lot of the AI companies are benefiting from right now. Is that the markets are just so much bigger now that the world is financially interconnected. You know, like one of the reasons, maybe not the only reason, but, but a driver for this huge ARR growth in AI companies is that you can now, thanks to Stripe and others, you can now sell your product from day one to everyone all over the world. One of the things that, that we benefited from relative to all other fintechs almost every other fintech, when they initially launch, have to pick one market, one very specific, you know, geography, one, one segment within that geography in which to compete. And we didn't have to do that. We, we just built this one platform and developers, you know, we now have, you know, developers serving customers in 90+ different countries on top of Bridge. And so we're probably one of the first, like, really global fintechs. That has been built from day one.

Okay. Um, I'm gonna change gears a little bit. I know we could talk about these. It is fascinating, I honestly, 'cause when you and I, I confessed to you, I think when we first met, I was like, this is not my thing. And then you got me interested in it. And I know there are all these use cases we could talk about a ton. I just wanted to, there were a couple other, yeah. Kind of want to learn more about you and then just about money in general.

Yeah.

If that's okay.

Money is very interesting.

People can go read about Bridge and, and some of these other bits But like one of the things we talked about was in this new world of AI and agents starting to do things for people, like this idea of, of an agent conducting transactions on your behalf is one part of this thing. And then, and then sort of like micro tiny transactions is another part of all this. Yeah, I don't know. How are you? What should the world be thinking about in terms of money in this AI era?

I mean, I think that it's going to— it's going to change across like many, many different, many different dimensions. So, you know, I think there's like a stablecoin angle to it, but there's also very much not a stablecoin angle to it. On the, on the stablecoin side, you know, I think that if one of two things— obviously if both things happens, then there's a lot of use cases. But if one of two things happens, then there's going to be a huge role that stablecoins play. One is that you have these non-humans accruing balances. There's really no way for a non-human to store value today. You know, in order to open a bank account, you have to be a human and you have to KYC and have an ID and, you know, a Social Security number and so on.. So if there is a use case for non-humans to store a balance, then stablecoins are almost certainly going to play a very large, large role. And then the second is that money needs to move at a velocity or in increments that are not possible in the current fiat system. And so that could mean streaming of payments, which, you know, it's very expensive to move fiat money. So if you want to stream payments in somewhat real time, that's going to need to be stablecoins. Or if you need to send very small sums of money, like you're paying for compute, and compute very similar to Scale AI and their data labelers, you know, very small payments, it will need to be stablecoins. But, but I also think that like cards, for instance, are going to play an enormous role where, you know, but, but the form factor of a card is going to, going to need to change. Like, you know, for instance, if you have AI agents buying things on your behalf, you will probably, you know, today you go and you get your one credit card, you know, and like, that's what you use, but you're probably not just going to give that credit card to every single AI agent, what have you. Like the, the way that cards are going to have to work is you're going to have to tokenize that card and give many different versions of that card to all these different AI agents and maybe with a bunch of different rules on top of that card. Right.

Because you don't want Some AI spending all— exactly, maxing out your card just because it had some weird idea.

Exactly. And you don't want that to happen. And then if it does happen, who's going to be on the hook for it? You know, are you going to be on the hook for it or is the merchant going to be on? What if they ship the goods already or is, you know, the bank going to be on the hook for it? You know, all these problems haven't been solved.

This like is happening now, right? Yeah.

Yeah, yeah, yeah, yeah, yeah.

What? There's, there's already agents spending money.

Yeah, yeah, yeah, yeah. And most of it, or I would say the overwhelming majority of it, is the, is the card use case is like, you know, Stripe announced a bunch of stuff at, at Sessions related, related to this where you can basically give, you know, your card information to, you know, a developer could integrate the Stripe API so that consumers could give their card information to an agent and then go out and make purchases on their behalf.

It's doing what? It's renting cloud space or it could do—

it could buy a bicycle, you know.

Oh, so yeah, maybe it's like, it's like setting up a shopping service and just testing things out or needs a bicycle for some reason.

It seems like that's going to be the way most things happen. You know, like if everything from like, oh, I need to buy a new pair of skis, I go into, go into some LLM, I ask it what the best version of skis is, I say buy it, send it to my house, you know, and it does it too. You know, I'm in Cursor and I want to deploy my application and I need to, I need to, you know, get cloud space and I need to a bunch of downstream vendors and, you know, it just happens automatically in the backend.

This is wild. I mean, it's so weird because it feels like crypto's been around. This is not like this is an original thought. I mean, crypto's been around for so long. You're always like, what does it actually do? And then, and then now it feels like there's all kinds of interesting things happening with, electronic money all of a sudden.

Yeah. I mean, I mean, I think that, I think that, that there's an enormous number of things that are going to, that are happening with stablecoins that are interesting. I think there's also, you know, we're going to tokenize stocks and like, you know, a bunch of other financial assets which will then be made available globally, which is an interesting trend that's, that's happening. I think there's also a role to play for blockchains in, you know, identity verification and authenticity of of, you know, different, you know, digital artifacts that are created. Coming back to your, coming, coming back to your book example, you know, uh, there, there's a, there's a meaningful way in which blockchains can, can help, you know, assert the, you know, the authenticity of a post or a video or, or whatever else, the same way that they can create, you know, and assert the authenticity of the first manuscript of your, of your book. And so there's a, you know, like, uh, kind of like what we were talking about, there's the, the core idea of a lot of these things that, that kind of manifested in 2021. 2020 or 2022 is like still valid, but waiting for, you know, a scaled use case that isn't pure speculation to come around and drive adoption.

Sort of like the natural course of things with tech. I feel like crypto took this weird path though.

But I wonder, is it like that different from the internet? You know, like the early internet was crazy too. I mean, I wasn't really very actively involved.

I mean, I think I think it is just because Bitcoin was such a weird thing in and of itself, how it evolved, because I think when Bitcoin first came out, it looked like, in my head, I was like, oh, this is the early version of the internet. This will certainly evolve into this new form of money that is universal and we use for everything. And then it kind of turned into this just place to try to make money and store money. And then other people tried different things. And then, I don't know, it was also weird because even in the early versions of the internet, the early days of the consumer internet, there were useful— there were useful things you could do with some of the first services like Priceline and eBay and things that took off. Whereas like, I felt like with crypto, most of the time I was like, how is this actually better than— it's like, I don't have that much trouble paying for anything, you know? I don't really— I don't know if I need this to be tokenized and—

Yeah. Yeah, I think that it is one of the things that's been really hard to build in this space is that there was this, it feels like in tech there was this lull for a period of time and like people wanted crypto to come in and fill that void. And, you know, there was a building of excitement and then like a disappointment when certain things, you know, when like FTX blows up or what have you. But the, like, you know, a lot of the core, core ideas and core infrastructure, it feels like will come around. And, you know, the timelines may be different, you know, that we all thought they would be. But a lot of the value is going to— I think there's going to be a lot of interesting things that are built on top of blockchains in the next like 5 years.

It reminds me more of like when we decoded the human genome for the first time and then it was supposed to be every disease was cured 2 years later and biology was software and all this stuff. And then, you know, that really has taken like 20, 25 years and it is kind of happening now. But there was this trough of disillusionment.

Yeah. I mean, the— I certainly, I certainly believe that would be true. And like another, another one of these that I, that I think of is like, is like AR, VR and a similar, a similar dynamic. And, you know, I think people compare our acquisition to that, like Instagram or YouTube or something like that. I think of it like much more similar to Oculus than, than to those in that, you know, because like Oculus represented a whole new platform., you know, and, and there, there was a lot of things that were working, but there's a lot of stuff that, you know, where the market is like, you know, the company is building into and creating the market. And, you know, in a lot of ways we're, we're, we're doing the same thing.

Does this, do these trends end up making the US dollar stronger or because you could be backed by another currency and it's much more fluid, this kind of like spells the end of of the US dollar dominance?

I think that it makes it a lot stronger. Well, well, it, it basically, maybe to put it a different way, it gives consumers a lot more choice. And so consumers all around the world now have economic choice. You know, a contractor in Argentina can choose to get paid in Argentinian pesos or can choose to get paid in US dollars or could choose to get paid in euro or digital euro.

Choice.

And right now that economic choice is massively benefiting the US dollar. Yeah. I mean, we support every stablecoin that, you know, folks want and 99% of the volume through our platform is US dollar denominated. And consumers, when they're choosing to get paid out from, you know, payroll platforms or get aid or whatever else, they're choosing to get dollars. And so, so long as consumers continue to choose dollars, it drive more and more dollar interest. And, you know, it will, it will create another very stable, very big acquirer of US Treasuries.

And is China like embraced this technology or not so much?

I mean, it not so much. I mean, not in like the open sense in the, in maybe the way China has adopted most other, you know, technologies, they, you know, like social media and so on. There is like digital forms of its dollar, but it's not open. And, and in a lot of cases, it creates like an immense amount of control because you could literally reach into someone's wallet and turn the dollar off, which is a scary version of, of stablecoins.

Okay. Are Patrick and Sean Calza— I guess they're your boss technically.

Yeah, they— yeah, yeah, yeah, yeah.

I mean, so I've known them forever. I'm putting you in a, I don't know, unfair position or one where you have to answer this question a certain way, maybe. Um, I mean, I've just been fascinated by them for a long time. I met them— I think Stripe was probably like 8 people, if my memory serves. And these people told me, there's these two Irish brothers, you should go meet them. They're kind of different. And I remember Walking in, I was just like, oh, you guys are going to do fine. You seem very smart and kind of grounded. And then I've gotten to know them better over the years. I mean, there's these very interesting, extremely well-rounded humans. I saw that you seem to be like a pretty avid reader and they, I think, have read like every book apparently.

I think so.

Yeah.

I think so. Although I recently was with Patrick and I recommended a book that he had not read Yeah. Which I feel like is like a badge of honor.

What was it? What was it?

It was called Greatness Can't Be Planned.

Okay.

And it's like this, it's a very interesting book around these like AI researchers who, who basically were training these, these, you know, these, no, they were, they were robots training these robots to navigate these like complex mazes. And they basically realized that every time they tried to,, engineer the robot to perfectly navigate the maze, it failed and was really hard. But, but when they optimized the algorithm to do something different than it had done last time, not to try to find the exit, but just do something different, like, uh, that they found the exit the fastest. And then in doing this research, it sort of turned to them in like a philosophy around how like the, the, the best outcomes don't necessarily come for optimizing for that single destination, but instead for optimizing for randomness.

So this is nonfiction.

Yeah, yeah, yeah, yeah.

This is like, this is like AI advice or something.

So it's, it's, it's AI researchers, uh, uh, giving life advice.

Okay.

Which is very niche.

Uh, yeah. And, and did you form I guess they were just watching what you guys were doing or you already knew each other. I mean, did you guys have sort of a— I felt like you guys strike me as similar disposition in some ways. You must have— I guess you guys just got along from the outset.

I think that's it. I really— I didn't have any relationship with Patrick before starting Bridge, and we actually met for the first time maybe 3 months or 4 months before the deal closed.

Okay.

All right.

This is different than I expected. Okay.

Yeah. Yeah.

So like what struck you or has struck you about them since?

I mean, I think that I would say like relate, I mean, related to the, to the deal itself. One of the things that I was the most surprised by was I had come in with a certain set of expectations because Stripe has not historically made, you know, they have made investments. They, they, you know, when I joined Coinbase, actually this was in in early 2017 or late 2016 or something, the, the, the Coinbase's like big thing was paying with Bitcoin. It was like before Coinbase believed that the exchange had product market fit and Stripe was like the main anchor customer for, for paying with Bitcoin. So they've had these experiments in the past, but they hadn't done and made a lot of progress in the crypto space. So I was skeptical that they were as optimistic as I was about this new, this new platform. And the one of the things that was amazing to me is that in many ways they had been thinking about and had been excited about this long before I was like years before they had made investments in this space and they were active participants in this space. And so their conviction was really deep. In this, in this, in this arena, which was great and probably one of the reasons why this all manifested the way, the way it has. And so that was like, I don't think things probably would have, would have worked if it wasn't for that.

Is there anything they have said that's made you rethink part of your business drastically?

I think they Probably. I don't know if there's anything they've said that I would— I think that, that, that more it's sort of what they have done. And, you know, I think that they have much more clearly articulate in many ways than I could clearly articulated a lot of the value of stablecoins to the world and in them articulating that value have sort of pushed the world forward. You know, like one of the, one of the things that, that, that people say a lot or, you know, what have you is like kind of like skate where the puck is going or, you know, and that kind of implies that there's a certain velocity to the puck, you know, but the stablecoin space had like no velocity. It was just like, it was just like a puck sitting there. So you could have skated in any direction. It was never going to get to you. You. And, and, and so what's happened for us is that like we, instead of like skating where it's going, we kind of like we're a magnet attracting the puck to us. And, and what I think that, that they have shown is that like by so clearly articulating a lot of these use cases and like, you know, building on top of us to launch stuff like financial accounts and these card products and so on, you create even more velocity to that. And the world like is driven and buy these anecdotes, you know, and then you have like Stripe doing stuff and then another customer builds on like SpaceX launches on top of that and the government comes and then Scale AI comes and then Dollar App comes and then eventually it becomes this inevitability.

You said when you were growing up, you were just interested in money, right?

Isn't that kind of how you put it?

I mean, everyone's kind of interested in money, I guess.

Some more than others.

Yeah, what does that mean?

I mean, I have— I've— I, I, you know, I think a lot of the people that you interview are like, you know, they've always been interested in mechanical engineering or they've always been interested in science, blowing stuff up. Yeah, yeah, yeah, yeah. Like for me, I've like been interested in like business more so than— more so than any of these— any of these other things. Like, like to give an example, when I graduated from college, I wanted to be an operating partner at a private equity firm, like a very bizarre job, like the person who comes into like a company company and helps fix up the company because I just love business and in some, in some capacity and, and then, and then when I did that, I realized it was a horrible, like an absolutely atrociously bad job. And I left and was like, I'm going to start a company, you know? And then the only ideas I had were fintech ideas. And so it's just like my mind is just for some reason attracted towards people's relationship with money. Money and the way money moves. And then, and then now having worked at fintechs, you see like, like at Square, we help merchants accept card payments. And the impact that Square has had is like so profound. And Stripe, you know, enabling folks all around the world to accept card payments and a seller of candles in the UK to sell to people all over the world. The impact that you have is like so immense. And like, we believe the same thing is true by lowering the cost of moving money and building financial products across a bunch of different borders, the impact you can have is really big. And so these are— I don't know exactly why, but these are the problems my mind has been drawn towards.

And you're not— I mean, I guess you can't say you're burnt out or interested in other things at the moment. I mean, you're still, you're still as interested in finance as— even though you've done this your whole career and in these different ways and shapes and forms and have all these other interests outside. This is what I always ask Patrick and John. I'm like, I, you know, they have like personal, or they did for a while, personal tutors for physics and law. And I was like, how can you keep coming back to Stripe when you seem like you're fascinated by so many things?

I know. I mean, if I, if I, I heard the interview with Brian where he was talking about the same thing around like biology and this sort of thing. And, and, you know, I think maybe in some time when like Bridge is kind of like made it, you know, then, then there's, then, then I'll sort be very interested, you know, have the time to do it. But for now, I'll stick to reading my, like, you know, AI philosophy and, and so on.

I think you didn't— you started the company in Austin.

I started the company in Austin.

Yeah.

Is it? Yeah.

But it's headquartered.

Yeah. I moved back. I was.

Yeah. Yeah.

Yeah. Yeah. I was one of those people. I fled.

Was it just for a change or you were like fed up with San Francisco?

I was, I was, um, it was basically just for a change, but I was, I was so glad to have left. I, I, you know, San Francisco, there is a, um, a real, like, uh, uh, I don't know how to describe it other than like a status game of like the, the, and a momentum to build around the things that have excitement, you know, so like right now it's like like there's this immense gravitational pull for people to go into AI. And at the time I was, you know, the head of product at Brex. And I think that if I was still in San Francisco, that gravitational pull would have pulled me in a certain, in a certain direction that was not starting the company. And having left, I just didn't feel any of that. So then I could just do whatever was interesting to me. Me. And the most interesting thing to me was to start this company that everybody thought was a terrible idea.

And then what drew you back? Just the talent and the—

Yeah, it's just like now having, you know, once we found like some inkling of product market fit, it just made so much sense to come back because there are so many people here in the company in it. And so the talent here is like way, way, way, way above and beyond. I mean, I started the company in, I also lived in London for a period of time and it was very bleak. Like the founder community there was very bleak. It was very isolating. Um, it was, it was very, I can't imagine what it was like to start Revolut or something to build a whole ecosystem where, where one did not, where one did not exist. But yeah, move back and now, like, I mean, I love, I love I love being in, being, being in San Francisco now.

You're sounding more pro than I was expecting. No, no bullshit, um, rating on the new mayor?

Uh, well, well, I guess I will say that I think that, I think that if the thing that I don't like about San Francisco, like, like take, take YC for instance, right? And right now, like YC is the, the only way to get in is to start an AI company, you know, and like, you know, you have Palmer Luckey on, you know, he left and went somewhere else to start a defense tech company because like San Francisco just wouldn't, wouldn't have it. And, you know, Brian is in LA and, you know, it is kind of like while it does have this immense tech talent, it does, it is very like consensus. It's like for a place that is like so, you know, contrarian, you know, perceived to be contrarian globally, it is really not that way when it comes to like a lot of venture investors and a lot of founders and what they and what they want to and what they want to start. And that's why I like the fintech world is actually becoming more and is more and more dominated by New York because, you know, San Francisco sort of shifted before into SaaS companies, you know, like 80% of YC companies were just, you know, sales SaaS tools and whatever else.

I was just, I was just in Europe for a couple of weeks. I mean, they were asking me like, do we have any shot at AI? And I gave them the very bleak assessment that I don't think they have, not unless something drastic changes in the amount of money they're willing to invest in some of this stuff. But they kept coming back to, to finance, to fintech. And they were, they were, they were pushing back at me that the US is It's very antiquated, mostly like in terms of how you pay for goods when you're out and about.

Yeah.

And then I've, you know, the last time I was in China, I mean, I think they're kind of even past this now, but I was there in the QR code era and that felt like way beyond whatever we do here already. Is that just, is that true? Is that just a function of, yeah, like why do we, does the US suck at payments and is that our destiny?

We, we do. I mean, we, we do, but it's like, it's, you know, it's, it's like, it's kind of like some of the things that are great and, you know, that, that have the, the, the negative externalities about, about the US. So, you know, the US has like thousands of banks in, and like most countries in Europe have like one bank. And, you know, we have this system whereby every state can have its own banks and, you know, and, and in the American way, all those banks can make make their own decisions in terms of what they want to do and what services they want to provide to their customers. So when it comes to rolling out a new payment rail like FedNow or what have you, you don't have like, you know, the government just dictating to everyone exactly what, you know, services need to be provided. Instead, it's driven by a lot of bottoms-up adoption, which, you know, is, is is good in a lot of ways for like, you know, fintech innovation and, and so on, but, but is like not good in terms of providing, you know, government-level, you know, core, very fast payment rails because we just don't have a mechanism to force it out all the way across the country. I mean, I mean, in fact, we don't even have a regulatory framework to license, federally license a payments company.. So if you want to be a payments company, the only way you can get the licenses is to get 50 individual licenses from every single state, which is, you know, I never, I never really thought about it, but is crazy. And actually, the first person to point that out to me was Patrick, who, when we were in this like meeting, meeting with a, with a regulator and he was talking about a federal payments license, and I was like, huh, that's like a super obvious thing that we should have, but we most definitely do not.

Are you okay on time for just a little bit?

Yeah.

Um, well, so how do we— do we change that, or this is, this is our lot in life?

I don't know if we change it. I mean, I'm kind of like, uh, you know, what, what I think will happen is that, you know, not to speak my own book, but, but I think that stablecoins in a lot of ways will end end up solving this problem.

Yeah.

Yeah. And so, and so in a lot of ways, stablecoins will like recede in the background. You won't even think of like, you know, a stablecoin as different from a US dollar. And like, you know, eventually I'll send you money and you'll get that money and I'll have $100 and I'll send you $100 and you'll get that money instantly in your bank app or what have you. And it will be facilitated via a stablecoin payment rail and you won't have to use FedNow or an RTP, you know, real-time payment rail. Or whatever else.

Do you, do you travel around the world a lot to try to see what different people are doing? Who's just doing the most interesting stuff?

Uh, uh, I would, I would say the, uh, so I would say we, we see the, the most adoption. Um, uh, we, we see that, well, I would say actually like the, the, the SpaceX example is probably one of the more interesting examples because just before SpaceX you didn't have have someone who is selling and scaling, you know, services in all these different countries as quickly as them.

A global telco.

Yeah, exactly. It is, it is, uh, like, like an amazing feat if you think about what they're doing. Cause you know, not, I mean, you have to put these satellites into space and, and, and that part is like really hard, but, but, but actually the way this came to be was that they were telling someone at Sequoia who is Sean, who is, who is our investor at Sequoia, they were telling him that the hardest problem they were facing was like, yeah, they can put these satellites, you know, into space pretty regularly now, but actually turning on payments and moving money, you know, back to the US and all these countries is often the limiting factor to serving these, these different countries. And, you know, it's, it's real, you know, you're selling, you know, internet in Malawi and Malawi just doesn't have US dollars. So you're getting local currency, but then how do you get it out of the country if there is no local currency in that country? Or you're doing the same thing in Kenya or Nigeria or, you know, wherever else.

Yeah. And when the last time I was in Nigeria, I mean, there were, I swear to God, like 550 payments companies. I couldn't even tell what they were all doing. And then everywhere I went, any store I went into, they would just have their phone number up at the top of like a chicken sandwich shop. And you were just supposed to like, I guess, text from your bank or whatever to them.

Yeah, yeah, yeah, yeah, yeah.

Is there any other outside of the obvious centers of finance that's doing pretty compelling stuff?

I mean, I think there is. I can give you like a couple, a couple examples of like some of the things that I'm like more excited about. One of the one of the, one of the folks who we just, we just launched with this company, Sling Money, and they're basically building a global base, a global peer-to-peer payment product. And, you know, they, they were the first company. They basically started around the same time we did. They launched and on the first day they launched in, I want to say like 70 different countries. Countries. And, uh, you know, that was like never really possible before. And then, and then because of that, they started seeing like huge growth in Kenya, then huge growth in Nigeria, then huge growth in South Africa, then huge growth in LATAM. And, uh, and, and, and the amazing part about it is that it's really hard to like, you know, pick which markets are going to end up being the most successful or the most underserved or what have you, and they're able to like build an exceptional experience, just blanket the globe with it, and then see where, you know, consumers are the most underserved. And like the thing that we just totally take for granted is that, is that like I said, there's thousands of banks in the US, so there's a bunch of them on top of which, you know, if I want to build some, some financial product, I can do that. That. But, but if you go into Nigeria, there's like 2 banks and those banks don't want you to build a fintech. And, and so, you know, we have all these building blocks here in the US, but, but most, a lot of like actually most countries do not have like any building blocks. And so stablecoins are like providing this first building block on top of which like, you know, these, these like world-class class financial experiences can now be delivered to all of these local markets. And so, yeah, so we saw, we saw that with them, but we also saw that with like Dollar App doing that across LATAM. And, you know, they launched in Mexico and Colombia and then, and then, and then Argentina. And, you know, we even have like, like, like large, like enterprises who, you know, move money. You know, let's say you're a large company and you sell goods in a bunch of different countries, you generally had to sell those goods and then store money locally. Because if you move money across borders, you'd have to pay taxes on it as you repatriate it and yada, yada, yada. And, but the issue is that if you kept the money in these different countries, then you had to keep the money in local currency. So you were exposed to FX risk. And so now you can actually, with stablecoins, you can keep the money in these countries, but keep it in dollars., and so there's all this like core, you know, oftentimes the things that I'm like the most excited about is just like the core ways in which like, you know, the premises on top of which companies are built and finance departments are built that actually turn out to not be true. If you now have, uh, you know, this financial asset that can be stored and moved anywhere.

Is there, I mean, I guess we talked about some of this with the AI stuff, but, uh, I don't know, just kind of like a last note to leave people on, on, on what's like the weirdest idea you have about where money is heading.

Oh, the weirdest. Let me, let me, let me think about that.

The AI stuff is already fairly strange, I think.

Yeah. I mean, I, I mean, I think there are like two futures that, well, I say that, well, there's like one, one future where if you play this out to like a logical conclusion, then the, the one of the things that is like very strange is that adoption of stablecoins becomes rate limited by the amount of US Treasuries that exist. And what does that kind of mean? You know, if you have basically trillions and trillions of dollars floating around held by these like very few stable, you know, stablecoin issuers who are, you know, own, you know, call it like $2 trillion or $5 trillion or $10 trillion of, of US, of US debt. And how that, how that like, you know, what is that? What does that mean for us? And then I think there's like the other of like the actual consumer adoption bit. And I think that's where the, the AI AI adoption bit. I think the other part that I like, you know, I talked about the, what does it mean for non-humans to have balances? And like, what if the richest person in the world is like an AI agent? Uh, you know, like what, what is that? What, what kind of happens in that world? Because we've never had a world where non-humans could, could accrue massive amounts of material wealth.

On the plus side, I'm not sure it could be weirder than Elon, you know, like, uh, if the AI has that full, full range.

Yeah, but like, how would, how would you interact with it, you know? Like, in what country would it be paying taxes, you know? Where would it be domiciled? Where would its residency be?

That is wild. I mean, this isn't even like out of the realm possibility and a nearish future.

Yeah.

Yeah.

I mean, I don't think that, that, that we have, I mean, and it could very obviously have like, like it could happen right now. You could, you could set up a bot with a balance and then have that bot just trade crypto. And it could be like, you know, the Renaissance capital of the crypto markets and big run. Yeah. And, and just accrue billions and billions and billions of dollars of assets. And then what? And then what if it started like deploying that money into like political campaigns and, you know, what have you?

Yeah. Yeah. I mean, how does any government possibly keep up with regulating anything like that? I don't know.

Yeah. Yeah. I, you know, it's, it's, it's, I don't know. And then, and then can, can an agent, you know, now that it has this balance, like contribute politically? Can, can, can the agent like buy ads, you know, to influence whatever causes or things that it's interested in? Because once it accrues capital, then it can do all the things that, you know, people would, you know, potentially want to do with capital.

I would let it buy ads on Core Memory. I always do. I do my own questions. I think I'm going to, I'm going to set you free in a second. Second. Sometimes I do get the AI to, uh, to suggest some questions. It mostly wanted to know what life is like after you get bought for a billion dollars, if there are, if there are life changes that occur.

Uh, um, I would— I mean, maybe ask me in 2 years. I would say, I would say 6 months in or whatever, whatever it has been, no, our life is, you know, exactly the same. So, so when when we were, when we were in these acquisition talks, I like went to my, my wife Taylor and I was like, okay, you know, I've been working on this company and if we sell the company, like, is there something you'd want to do with the money? Like, is there something you want to buy? Something, you know, anything? And she like thinks about it for a second and she was like, I might get my nails done once a week. And I was like, I think we can do that now. So, so, so nothing has, nothing has really, nothing has, nothing has really changed. And if anything, like the work itself has gotten more intense because post-acquisition there's so much more interest in stablecoins and it's like becoming more mainstream. You know, there was like a distinct moment, like pre-acquisition we were like fringe and very contrarian and now post-acquisition we're like a little more mainstream. And, and so that's attracted a whole new set of folks who want to, who want to, who want to build with us. But, but, but other than that, yeah, nothing. I mean, not other than that, like really not that much has changed.

It was a crass, crass question on the AI part, I think. Um, uh, was that—

so an AI generated that question?

Well, I do all my own questions and then I did, I do like a deep research thing. Oh yeah, yeah, yeah, yeah. I don't know, just to sort of get as much information as you can. And then every now and then I'm like, well, what would you ask Zach? And what did, what would you want me to ask about replacing Swift and all that stuff? But we already kind of did those. Uh, did This was, this was ChatGPT deep research. Um, I kind of hop between, yeah, Claude and ChatGPT, and then sometimes I try Manus just to just see what's going on.

Oh yeah, yeah, in China.

Yeah, it is interesting. They are, they are like, not like drastically, drastically different, but I— again, this is not a novel thought, but they do have the different nuance. Like, Claude is, Claude is definitely a better writer. Yeah. Than Chat, although I think that OpenAI has stuff coming, but, um, yeah, it's definitely, it's definitely a lot, a lot.

It's definitely a better, a better writer. And I, um, I send like investor updates out every— still I do it. I send them. I send— it's like a very therapeutic thing to write. And then I recently loaded all of, like, not all of them, but the last 10 or something in and then asked Claude for feedback. You know, what if you're the foremost expert in, in, in, in startups and fintech and, and what would you give as advice to the founder and what have you? It was like very succinct and like clear feedback that was like, oh yeah, I really have been doing a bad job on this. I need to be better. And then I shared it with our team and they're like, yeah, we've been telling you this forever. And then the robot tells you and you listen.

I thought you were going to tell me the AI was writing all the investor letters.

No, we tried that and they were really bad.

Yeah, yeah, yeah. Everyone's always like, they're like, oh, do you just let the AI write for you now? I mean, it is still really bad.

It's, it's, it's quite, it's, it's really, it's definitely, it's definitely not good. I had the idea of like loading them all in and then being like, okay, write the next one. And I was like, oh, this is going to be so genius. It's going to save me so much time. And then when it spit out was just junk. It was like tons of hallucination.

Yeah, I did. I saw, I did put a whole draft of a story in, and this was like in a new account. It didn't know that it was me. And I asked it to guess like who wrote the story, and it did. It guessed me out of like all the people.

Oh, wow.

I think Ashlee Vance wrote the story. And then it told me why. In the first 3 reasons, I was like, okay, yeah. Then the next 3, I was like, God, you kind of know me on a level I I hadn't even—

wow, that's like, that's, it's, it's pretty awesome that you have this like public corpus of, of writing, you know.

It is. I guess that just means it's like hoovered up enough of my copyright. Yeah, yeah, yeah.

I know, because now I can write like you.

That's, that's the frustrating part because sometimes I try to save time and I'm like, write this YouTube description in the style of Ashlee Vance, and then it can, it can discern it, but I don't think it can reproduce it yet.

And you asked it like, what is my file for that?

When I— no. So I dropped the draft in. I said, can you guess who wrote this story?

Oh, okay.

It was like, my best guess is Ashlee Vance.

Yeah.

Wow, that's kind of creepy. Yeah.

Are you like, write like Ashlee Vance but like more entertaining?

I do. So I do that sometimes because again, I want to assure people I don't use this for like my, my Substack posts or anything, but sometimes you just do it a YouTube description.

It's two paragraphs.

You're like, You just kind of got to get the basics of the information. And yeah, so I'll tell it to do me and then it's like kind of crappy, I think. And then I'm like, no, do it like smarter, funnier, more concise. And it's still like kind of not quite right.

Yeah. I mean, I bet we're at this state where like maybe 80% of everything on Twitter is already augmented or written by an AI.

And, and like LinkedIn is for sure just like AIs talking to each other in the Right, like offering jobs, writing resumes. I mean, you, if you glance at LinkedIn for a little bit, it's just a wash.

Yeah, LinkedIn is like, literally you're like, how do I get more engagement on this? It's like, okay, throw in a rocket emoji and throw in a hands up emoji. And like, and then you notice that in every single, every single post. But like, we're, you know, next year or something, everything on Twitter, everything there is going to be written or— and then it's like, I mean, maybe like as a consumer of it, I'm still like, okay, I like am engaged in this, is like kind interesting, but I don't know how I feel.

Well, going back to the very beginning when you're like, now that I'm in this role, this is the first time I've had to hire people. And yeah, it is, it's depressing when you put out a job posting, you can tell an AI wrote the, the, you know, the response back, the return. Yeah, yeah, yeah.

I mean, I mean, we've had, for, for our interviews, we've had to change all the way we interview because people basically just cheating. Yeah, you know, like even our coding interviews, you're sitting there trying to pair with people and, you know, we ask them to share their screen because all these coding interviews are remote and, and they like find ways of sharing, you know, just, you know, one screen but not the other screen. On the other screen they have like—

I see that on like Instagram, so I'm just interested if that actually happens.

Yeah, yeah. We've, we've, we've had many, many people in the interview process that have like gotten kicked out and there's probably some who we've hired, you know, they end up being really good engineers, but, but, but it's Still not, not, not, not, not ideal.

Doesn't feel pure.

No, not at all.

Zach, thank you so much for your time, man. I feel like this is like the most interested I've actually— this is not just because you're here on some fintech thing ever. I mean, I feel like people even just on the remittance part underestimate what a massive part of the economy that is. I find this all fascinating and And, you know, thank you so much for helping us understand how some of this works.

Of course. Thank you so much for having me. It's been really fun.

It was awesome. Thank you. Core Memory is hosted by me, Ashlee Vance. The show is produced by David Nicholson and me sometimes. Our theme music is by James Mercer and Jon Sortland. And the show is edited by the John Sortland. Thank you all for listening. As mentioned, this show is sponsored by Yuan Ventures. Thanks.