Stablecoins Are Not a Duopoly: Big Companies Want Their Own Coin
The multi-stablecoin debate returns: Rob says he knows of multinationals issuing their own stablecoins, Circle's USDC network effect is underrated, but if rates fall to 2-3% its revenue gets cut in half.
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The argument · tap a timestamp to hear it
The multi-stablecoin debate is not over
Santi previously said the ‘hundreds of stablecoin thesis is dead’, and Rob pushed back on the spot. Rob says he knows of multinationals issuing their own stablecoins; SoFi, Verve, two bank consortia, the Stripe consortium, MoneyGram and Western Union are all doing it, and Bridge already has its own stablecoin internally for treasury management. His mechanism: big companies hold a lot of cash, and if they can earn yield on it, they have an incentive to issue their own coin rather than use USDC or USDT. Santi pressed: don't these big companies have FX desks at JP Morgan and Morgan Stanley? Rob said it depends on the size of the company and the complexity of global treasury management — Western Union's remittance corridors in Africa and Latin America are something JP Morgan's correspondent banking network can't do well.
— Rob HadickCLARITY failed, but nobody has really given up
The Senate voted down the CLARITY Act 49 to 50 on Tuesday; it needed 60 votes. Three Republicans — Susan Collins, Josh Hawley and Jerry Moran — voted against, and every Democrat they had been counting on voted against. Santi said not to over-read Tillis's turn, since Kirsten Gillibrand said that same day she is still pushing the legislation. On Polymarket the odds of passage fell as low as 4% at one point, then came back to 8%. The market sold off on the news, with Coinbase down 10% and Circle down 12%. Rob said it's worth remembering that dozens of people worked on this bill for a year, including staff on the Banking Committee and the Agriculture Committee.
— SantiThe SEC gives tokenized stocks a five-year exemption
The SEC issued an order granting tokenized securities trading venues (TSVS) a five-year interim conditional exemption, letting them trade tokenized NMS stocks through permissioned AMMs and liquidity pools without registering as exchanges, and liquidity providers got a limited market-maker exemption. Two key conditions: token holders must get the same rights as holders of the underlying stock, such as dividends and voting; and third-party tokenization requires written notice and giving the issuer a chance to object. Santi read that out and said this clause could directly break the current onchain tokenized stock practice — if AMC can object, you can't just throw AMC onto Hyperliquid. Rob said this is almost certainly coming, because onchain tokenized stocks currently create strange dislocations after hours and pre-market, and Robinhood pairing memecoins with tokenized stocks is an example.
— SantiThe winner in tokenization is the whole ecosystem
Rob said it's hard to point to a single winner. The obvious beneficiaries are issuers, existing exchanges and clearinghouses, new exchanges that want into the US market (Coinbase, Polymarket, Lighter, Hyperliquid, Backpack), global neobanks, and new transfer agents and core infrastructure providers such as Alpaca. Santi said his first reaction was Superstate and Securitize, and Securitize was up 16% that day. Rob said this looks more like a rising tide lifting all boats than value concentrating in one place. He added that as more assets come onchain, everything onchain gets bigger — more liquidity, more users, better infrastructure, more stablecoin issuance.
— Rob HadickS&P buying Open Zeppelin is buying data
S&P is a ratings agency with a roughly $120 billion market cap and about $14 billion in revenue; this week it first led Kao's Series B extension (Kao raised its Series B four years ago, and this time may have raised about $50 million, bringing the B round to about $110 million, with investors including RBC, DRW, Broadridge, BNP and Nasdaq), then acquired smart contract security firm Open Zeppelin. Rob said the acquisition surprised him, since Open Zeppelin doesn't seem like a company that would run a process to sell itself. His read: S&P gives ratings, and it can use Open Zeppelin for real-time risk benchmarks and data, to assess what happens inside protocols, and then sell that to clients. Santi said he heard this is the first such deal, and that traditional capital markets data and analytics players (Moody's and others) will do more of the same. Rob said many crypto companies raised a lot of money and have good products but aren't good enough as standalone businesses, and companies like S&P grow into conglomerates by constantly buying good niche products and then bundling them for you through a terminal.
— Rob HadickCircle pushing memes on Arc's first day was a misstep
Circle launched Arc, with more than 190 partners on day one and over $220 million of TVL pre-seeded in a Morpho vault. Rob said he doesn't understand why Circle came out pushing a bunch of memes on day one, since Arc had always been positioned as a payments-first chain, talking about agentic finance, privacy, FX liquidity and real business activity. He said this is the exact opposite of the story Circle has told for a long time, and it left a lot of people with a bad impression. Santi said he went to Circle's launch event yesterday, and the room and Twitter were two completely different worlds — within an hour he met people from BlackRock, DTCC, ICE, Visa and MoneyGram, and Circle's convening power is extremely strong; if it had launched purely on its original positioning, the effect would have been much better. Rob said Circle may have been looking at the success of Robinhood chain, but Robinhood is a trading platform and Circle is a payments company, and having bought Taza Pay it should stay in its own lane.
— Rob HadickCircle's revenue gets cut in half by rates
Rob said he doesn't expect 4% to 4.5% rates to last forever, and that rates will normalize to between 2% and 3%, which means that if Circle is just an interest-income business, its revenue at the current TVL gets cut in half. He also said that as a payments stablecoin, if it can't share yield with end customers, there isn't much reason to hold large amounts of it. Circle's agreement with Coinbase requires giving 50% to Coinbase, which puts it at a disadvantage competing with new stablecoins. So Circle is working hard to become a payments company and get a payments company multiple, and Arc and the Circle Payment Network are both part of that story. Santi said not to underestimate USDC's network effect — in DeFi there is now only one thing that matters for liquidity, and that's USDC; any DeFi founder needs USDC on their platform.
— Rob HadickInstinct's reckoning comes in month four
Rob said companies are now getting bigger faster and raising more money faster, that venture capital as a market structure is broken, and that the hottest companies see valuations rise faster and faster regardless of fundamentals. He said a company's first big reckoning usually comes in year four, but Instinct's first big reckoning will come in month four — because the two biggest companies in the world are about to launch direct competitors, Grokbot and Meta's Muse. Santi said in his own use Muse is six to eight times better than Instinct; Instinct is clearly compute-constrained, and for the same question Muse is sometimes 10 to 15 minutes faster, fails less often, and can route around the roadblocks Resy has set up for these products. Rob said he doesn't know how growth investors are comfortable at this valuation, and the only thing that could prove them wrong is Instinct sprinting to train its own model, but that takes a billion dollars to build data centers.
— Rob HadickPolymarket is fighting a talent war
Polymarket announced four major hires: Bird founder Travis VanderZanden as chief growth officer, former Amazon, EA and Delta CFO Warren Jenson as its first CFO, former DoorDash GM Colin McKinney Hill as VP of operations, and Zora founder Jacob Horne joining to lead DeFi. Rob said prediction markets are fighting a talent war, because 14 months ago these two companies basically had no revenue and now each is doing billions in revenue, growing extremely fast but with growing pains. Shane is an extremely visionary founder who can get people to follow him into battle, but running a large regulated exchange is very hard, so bringing in a team of professional executives was inevitable. He also noted that Polymarket had already hired GC Neil Kumar and Ari in charge of sports.
— Rob HadickIn their own words · checked verbatim
I can tell you uh there are multi multinationals that I know for certain are launching their own stable coins.
Rob Hadick4:05
I think there's some revisionist history of people saying I never even wanted to pass in the first place. But, like, let's be honest here on this podcast. Like I think we all want it to pass or at least I did.
Santi13:18
the way I read this was the written note the a chance for the issuer to object breaks down a lot of what tokenized equities look like on chain today, which is like you'll just throw up AMC on Hyperlid.
Santi17:23
likely what we get over the you know from the the two agencies over the next u few months is going to be more pro- innovation than even Clarity was going to be
Rob Hadick20:26
then they came out and they seem to mostly promote uh memes on day one uh when it had previously been sort of talked about as a you know kind of a payments first chain. I don't know why they decided to do that frankly.
Rob Hadick38:34
I don't expect that we will have four to four and a half% rates forever and I expect that the rates will come and normalize somewhere between 2 to 3% over time which means that you know if there this is a business that is just interest income like their revenue will get hald on their current you know amount of TVL
Rob Hadick42:38
the first big reckoning of a company comes in year four. first big com reckoning for instinct will come in month four here when two of the biggest companies in the world roll out direct competitors aka Grockbot and Facebook you know Meta Muse
Rob Hadick47:41
people have to remember when they talk about the prediction markets that both Khi and Poly Market had basically zero revenue 14 months ago. They had very very little revenue 14 months ago. Right? It was dimminimous. And now we're talking about companies that are doing billions of dollars of revenue each, right? 14 months later, the growth has been absolutely tremendous.
Rob Hadick52:43
Figures
| CLARITY Act Senate vote | 49 to 50, needed 60 votes | 13:18 |
| Polymarket odds of CLARITY passing | fell as low as 4%, later back to 8% | 14:18 |
| Market drop after CLARITY failed | Coinbase down 10%, Circle down 12% | 14:18 |
| Length of SEC exemption for tokenized securities venues | 5-year interim conditional exemption | 17:23 |
| S&P market cap and revenue | about $120 billion market cap, about $14 billion revenue | 29:28 |
| Kao Series B extension | possibly about $50 million, bringing the B round to about $110 million | 30:29 |
| Circle Arc day-one partner count | more than 190 | 37:40 |
| Circle's revenue share with Coinbase | 50% to Coinbase | 42:38 |
Glossary
- TSVS / tokenized securities trading venue
- The term the SEC uses in its exemption order for platforms that trade tokenized securities.
- NMS stock
- A listed stock subject to the US National Market System rules.
- transfer agent
- The institution responsible for registering securities holders and transfer records.
- DAT / digital asset treasury company
- A public company that holds crypto assets as its main treasury, often trading at a discount or premium to NAV.
- CPN / Circle Payment Network
- The payments network Circle launched, part of the Arc ecosystem.
How to listen
Founders and investors watching the stablecoin competitive landscape, tokenized securities regulation, Circle's business model, and AI application-layer valuations.
After 57:15 it's film/TV and celebrity chat, skippable.