The Money Movement / Episode 28

Episode 28

Regulatory Heat & Circle Platform Launch

Summary & Key Takeaways

Full Transcript

This week on the Money Movement, Circle CEO Jeremy Allaire will explore some of the big themes and memes of the week that have emerged around USDC and Circle, including reactions to reactions to The STABLE Act and other regulatory rumors circulating after the G7 Summit, more CBDC saber-rattling from central bankers, USDC crosses the 3 Billion in circulation milestone, and some major announcements coming from Circle, including a discussion with Circle’s Head of Growth, Rachel Mayer, and Head of Product, Joao Reginatto.

In his analysis on regulatory and policy hub-bubs, and the growth milestone for USDC, Jeremy will attempt to answer the top Frequently Asked Questions (FAQs) he gets on these matters.

About the show
The global economy is experiencing unprecedented challenges and change. Business leaders everywhere are grappling with how to transform their companies to become more digital, resilient and efficient. As we face this change, a new global movement is building around the promise of digital currencies and blockchains — forming a new architecture for the global economy and creating new opportunities for companies everywhere. The Money Movement explores and chronicles the issues and ideas driving this brave new world of digital money.

[00:00:08] Hello, I'm Jeremy Allaire, and this is The Money Movement, a show where we explore the issues and ideas in this brave new world of digital currency and blockchains, so is another really busy week in crypto and stablecoin land. USDC crossed over three billion in circulation. Circle launched a major upgrade to our suite of payments and Treasury infrastructure for the Internet. And there's been a lot of regulatory rumblings, if not regulatory heat. We're feeling it. We may be about to see a regulatory sledgehammer brought down on crypto in the United States by departing Treasury Secretary Mnuchin. So I want to dove into this. I want to break down what's going on and share some perspective on this. I'm going to start with some really basic stuff here. The first is just, you know, when we look at crypto and we look at Blockchains, we're looking at at at the core a very, very fundamental innovation, an innovation that has, I believe, far reaching consequences, much more far reaching than even the Web itself. And this innovation of public blockchains represents fundamentally a new infrastructure layer for the Internet. It's an infrastructure layer that allows for counterparts around the world to have an incontrovertible set of recordkeeping, a way to transaction process or to conduct transactions and a way to deploy code. These blockchains are like a new computing layer for the Internet designed to accommodate economic activity, and it's their public open permission list nature like the Internet itself, which makes them so transformative. And the uses of this technology obviously start with things like the new forms of commodity money that underlie and secure these decentralized networks like Bitcoin and ether. But the uses expand far, far beyond into really every category of recordkeeping industry in the world, every dimension of finance. But increasingly, with the improvements we're seeing in blockchains technology offer the potential to decentralize fundamental services like communications applications, social media applications. So many of the things that regulators are frankly looking to break up Facebook around, we can rebuild in a decentralized architecture on this on this infrastructure. Now, a lot of the attention on this show and in the industry is around the role of crypto and stablecoins and the like in this sort of world of value exchange. So a fundamental premise here is that on these public networks, on these permission HLAS networks, it's becoming possible to exchange value instantly globally, the speed of the Internet with much higher levels of security, privacy and resiliency versus fraud than our existing financial system can present. On top of that underlying kind of commoditization of value exchange is this new layer, this layer of programmability, the ability to create contracts, the the ability to create financial protocols that operate entirely on this these public networks. We're seeing that in the growth of borrowing and lending markets on the Internet centralize finance. We're seeing many of the building block primitives of how capital works in the world being built on this infrastructure. This creates an opportunity ultimately for billions of people to access financial services in ways that haven't been possible before. So a major a major innovation. Now, also, at the core of this infrastructure is the role that this technology can play in providing greater degrees of security, greater degrees of privacy than it did made possible with the existing financial system underlying crypto is this concept of a of a digital asset that is, in fact a better asset and that individuals have the ability to hold these bare assets independent of the state, non sovereign stores of value, non sovereign money. This underlies the tremendous interest in Bitcoin, even from I think now at this point, pretty much any major macro investor has a strong thesis that the dollar and other fiat currencies have challenges and that from a risk management perspective, holding these crypto bear assets as a hedge against what's taking place in the world economy is is not only rational, but potentially very desirable. So there's this underlying component that exists here as well, on the whole, this represents the public chains, these digital assets, the ability to have these public global protocols, in my view, is just an enormous human innovation that ultimately allows for radically greater financial inclusion, greater economic integration of entities, businesses and nation states, even breakthroughs in commerce and trade, business models, and frankly, the potential to return trillions of dollars in value that is captured by intermediary banks and other ecosystem participants in the existing financial system to return that capital into productive use for society. Now, we all know from the last 20 or 30 years that the open Internet makes it easier for bad actors to operate. We know this. It's everywhere. Cyberattacks, data breaches, hackers, terrorists posting videos online recruiting and operating using encrypted messaging apps. You know, all of this is is apparent and we know this. And at the same time as a society, we are not willing to sacrifice the open Internet on the on that basis alone. We are not willing to provide complete government control and boundaries on the Internet just on the basis of bad actors operating. And in fact, the really key thing is that law enforcement, national security apparatus, governments have adapted themselves and have built better and better tools. Now, in this space, in this world of this new open internet of of finance, we know the same thing exists. We know that bad actors are operating. There's lots of data about this. There's lots of firms that analyze this. And, of course, the firms that are intermediaries between the existing financial system and crypto and blockchains constantly work with law enforcement, constantly work to thwart that. That is part of our obligation. We also need to build new tools. We need to build new tools for an open internet of money. And collectively, as an industry, it's incumbent on us to build better and better tools that meet those needs, but at the same time preserving and protecting the innovation of public Internet infrastructure and public blockchains infrastructure in terms of of finance. So I think what we're seeing now is that this concern over criminal abuse is significant and this is where the regulatory hammer is being focused. But the approach. Which is a I believe, a shortsighted, simplistic approach based on what we're hearing is likely to do enormous damage to a highly innovative sector. Now, for those that aren't familiar with this, all this has sort of gradually bubbled up to the global level over the past years. The the body, the international body that is responsible for the rules around anti money laundering on a global basis. The Financial Action Task Force in twenty nineteen put in place new rules around firms in the digital currency ecosystem, needing to have controls in place to be able to collect appropriate information on customers, share that information appropriately. And that's led to a great deal of industry work that's going to roll out over the course of twenty twenty one, the so-called travel rule. These issues have become even more exacerbated and greater interest on these with the growth in Bitcoin, with the growth in Stablecoins like USDC, and with the proposed launch of Diesem Libra. And that's led to finance ministers from the G7 finance ministers and and other key stakeholders at the G20 to really look at. Is there more that they want to do to regulate this? So the kind of question people naturally ask is, is why now? Why now is because crypto is going mainstream, Bitcoin is going mainstream. Major technology firms are launching digital currency initiatives. We're seeing this industry grow up very fast. We're seeing stablecoins like USDC on the verge of being component's mainstream components of what the payment system can be when we look at why now. However, I think some of this is very specific to two agendas that exist. I think when we look at Treasury Secretary Manoukian and I've listened to him speak on this topic multiple times, he's got to be in his bonnet about self sovereign digital assets. And he'll say Bitcoin is fine. He'll basically say it's fine, but he thinks it's stupid. But if you want to own it, you can go. Had known it. He would essentially say Stablecoins are fine. If financial institutions are issuing these, they're fully reserved but unposted wallets. We cannot allow people to have secret Swiss bank accounts in their pocket. And those are his words. So this is the core issue. And I think in all of the work on any money laundering and countering terrorism finance, the industry has tried to preserve this interaction with self hosted wallets. It's a core component. It's one of the foundational components of a public blockchains of a permission list blockchains it's core to the innovation of smart contract and decentralized finance, the ability for an individual to participate in a financial protocol on the public Internet and any regulatory approach to this, to this fact that software can exist that provides self sovereign access to digital assets. Any regulatory approach to this, it seems, is now likely to be delivered with a sledgehammer approach rather than what needs to be delivered, which is to consider this with precision tools. This is exactly what appears to be happening as we speak. So earlier this fall, Vincent, the Financial Crimes Enforcement Network, which is a department within the US Treasury Department, issued a new proposed interim rule. Now, this interim rule was about tightening up travel rule definitions in a sense and and threshold. So specifically, this interim rule was proposed and it was essentially to say all crypto assets are included in the definitions of money and lowering the thresholds for transactions where all of this personal identity information needs to be exchanged to two hundred and fifty dollar transactions. And most crucially. It is posted on domestic transactions, not just international transactions, and this this specific interim rule went out for public comment and it's been deeply opposed by the industry. It places an unfair and unfair burden, an even larger burden on digital currency firms that go above and beyond, even what domestic banks must do now additionally. So we've had that that proposed rule. And additionally, in the background, we've seen apparent coordination of the finance ministers of the G7 who met this week and appeared to come to a consensus that they want to go further. And the kinds of restrictions that Manoukian has wanted to put in place are even tougher, and apparently these restrictions have been jammed into this new interim rule around interactions with untoasted Ross. [00:14:33][865.0]

[00:14:34] Now, this isn't final and we haven't seen it and a lot of the uproar and a lot of the attention and the letters from Congress. People, industry leaders and others are focused on this because if this happens, it has a massive impact. No one again, no one has seen the language and it's being added at the last minute before this interim this interim rule becomes law and the consequences are enormous in our view. However, jamming this in at the last minute is a total breach of responsible conduct with a period needed for congressional review, a period needed if with these refinements for public comment and review something that is so core and fundamental to the core benefits of public blockchains infrastructure, this kind of rule will undermine the premise and promise of financial inclusion and open access and radically limit the potential for innovation in decentralized finance. And frankly, this would continue to make the United States one of the least receptive countries in the world for the blockchains industry. So what's really at stake here? What's really going on for these various finance ministers? What are the real motivations here? Is this purely about, hey, we've got to have tighter restrictions on on financial crimes enforcement or is there something else? It's interesting, the public quote from the German finance minister, Olaf Schulz, he said, We must do everything possible to make sure the currency monopoly remains in the hands of states. So maybe this is about something else, maybe this is about a attempt to stem the tide, to plug the hole in the dam around what's happening with digital assets in the world. The motivations are not squarely focused. There may be justifications, but clearly a completely different level of standard being applied to this industry. There appear to be other motivations. So this is in the same week that the Financial Times published a piece about the inevitable rise of Bitcoin in the face of profligate money creation. The piece asserts that the legitimate rise of Bitcoin is happening as an alternative reserve currency, and it actually ends with an interesting note. Now, this was an opinion piece, but it ends with an interesting note. It says, And stepping in to regulate the digital currency boom, as some governments are already considering, may only accelerate this populist revolt. The point here is that. Individuals, investors, institutions want to build on and depend on digital currency and digital assets, and this challenges the nature of governance in the financial system. [00:17:34][180.0]

[00:17:34] And this is significant and it'll be interesting to see how people respond. Now, obviously, there's an incredible amount at stake for for our industry. And the question is ultimately what should be done? And there are ways to solve for the issues and risks that are purportedly being considered here, in fact, the existing system of money laundering and countering the terrorism, countering terrorism, finance is broken and doesn't work. We know the data. There's two trillion dollars laundered per year with US dollars by by the standards of of leading financial crimes, enforcement agencies globally and others estimate that 98 percent of money laundering in the existing banking system goes undetected. [00:18:35][60.8]

[00:18:36] So clearly, we don't have a system that works. But the solution to this problem, the ultimate solution to this problem, lies within public blockchains infrastructure itself. The only way to address the deep financial crime risks are by building on open, public, tamper resistant unsensible global systems of record keeping, and by building on that infrastructure, which is a breakthrough infrastructure, we can build identity protocols. We can build those identity protocols on the very same public blockchains infrastructure that we're building. These new forms of money and payment systems and identity protocols that are built on this can preserve privacy. And in fact, they can preserve privacy using crypto in a way that is far superior to the existing financial system, which is prone to an enormous amount of cyber attacks, data breaches and and violations of of PII. That's on a constant basis. It can do this in a way that allows individuals and institutions to use open networks to use permission, less networks to use decentralized financial services and protocols, and this broad array of other decentralized services that are being built on blockchains whether this is in the world of content or communications or recordkeeping and other forms, an identity protocol that is open, self sovereign and decentralized can build a model of identity. Issuer's identity issuers can be governments, identity issuers can be financial institutions, and these identity issuers can offer identity attestations that allows your customer to become know your transaction. And in so doing this still keep the vast majority of the benefits of decentralized protocols while preserving privacy and still enabling law enforcement to do their job and in fact, do it more safely, more securely without vast violations of privacy. So this is what the industry can do and this is ultimately incumbent on the industry to do this. The government's not going to do this. And many of these things are only now technically becoming possible. We're only now seeing third generation blockchains infrastructures that can support this and support this at scale. But the answer here is to stop the sledgehammer before it slams down. Treasury needs to put on the brakes. And give industry the time to build out these solutions if there's heightened concern on unposted wallets rather than try to lock it down. For now, identify that there's heightened risks, demand that financial intermediaries, virtual asset service providers operate with enhanced due diligence and more proactive monitoring for potential money laundering around interaction with these permission lists nodes, but at the same time work constructively with the industry as the industry creates solutions that can weave identity onto the public Internet, which, by the way, also addresses broad regulatory regulatory concerns that are around Internet firms having too much power on our personal data. The concentration of power with consumer platforms like Facebook, rising identity theft, all of these are things that can also be helped and addressed. This goes beyond the financial system into the integrity of the Internet. So there's a lot more to come here and a lot more to talk about on The Money Movement, but now what we need is we need the industry loudly and we need policy makers, congresspeople, senators in every country in the world, because this is a G7 mandate and a G20 mandate. This will come down and it will come down hard as a sledgehammer. We need this industry to stand up and stop that from happening. [00:22:45][248.7]

[00:22:47] Again, lots more to talk about. All right, we're going to change gears completely here and we're going to focus on something which I think is ultimately a lot more exciting and uplifting. We had a couple of really great milestones in the last week that aren't just with this regulatory heat. They're about really cool things. USDC crossed three billion in circulation. It's handled over two hundred and thirty billion in unchanged transactions. It's been really incredible growth. And on top of that, Circle launched a major upgrade to its suite of payments and Treasury infrastructure for the Internet. I'm very, very pleased to be joined here today by Circle's head of growth and product marketing, Rachel Meyer and Circle VP of product Joao Reginatto, welcome and huge congrats on the launch. [00:23:45][58.5]

[00:23:48] Thank you. Thanks. Thanks for having us. [00:23:50][2.4]

[00:23:51] All right, so we've got a lot to talk about here. There's a lot going on. I want to maybe just just sort of start a little bit with, you know, what it is that Circle is sort of putting out in the world as as as you guys know, but as others may not. We've been rolling some of this out gradually over the last six months, kind of culminating in this launch this week. And and and Circle talks about payments and Treasury infrastructure for the Internet. What does that mean, Rachel? [00:24:26][35.0]

[00:24:28] Sure, yeah, we've been focused on fostering growth for different types of global businesses that are solving different problems within payments, commerce, financial applications, and we're all doing that using digital dollars, Stablecoins. We're essentially what we're doing, what we're saying payments and Treasury infrastructure for the Internet is connecting those digital dollars like you see with traditional finance, like banks and cards and other types of traditional finance rails, but making that seamless for customers, letting them have access to the best infrastructure platform that connects those two worlds seamlessly. And over the course of twenty twenty, as you said, we've rolled out major updates and components to this infrastructure into this product suite from supporting different payment rails like card and debit, from bank wires to obviously native USDC rails on different blockchains markets marketplace features. And yesterday, all of that culminated in a major upgrade with new packaging and most importantly, new, simple and transparent pricing for our customers. And I think it's important when we talk about payments and Treasury infrastructure for the Internet, there's a lot out there already talking about embedded finance, banking as a service, treasury as a service. And when you compare those to us, those are just nice wrappers on that old legacy infrastructure. We're doing it digital currency native, we're executing on that vision that digital currency becomes at the core of storing and managing money and value on the Internet and facilitating those transactions and making that same user experience that a customer might expect from operating with a traditional infrastructure, but driving the major cost and speed benefits so that a customer can operate globally for all of their banking and treasury needs. [00:26:36][128.4]

[00:26:37] I like that last bit that you talked about, which is, you know, they're sort of like this next generation of the fundamental nature of money, right? This actual digital money, actual digital instruments, actual open infrastructure that's run on the Internet, it's run entirely in that form. And that becomes the core, right? That's that's the new transaction core. That's the new core. And the the legacy financial systems on the periphery. In many ways, you know, I think, you know, as you noted right there, there's been even just this last week, right. [00:27:19][41.5]

[00:27:19] There have been different products that are launching Treasury. We've seen cash management products, these kinds of things that are coming out that are built on the existing banking system. [00:27:27][8.2]

[00:27:29] But the opportunity now is for for creators, for developers to to build on like, you know, it's a word, but like a more modern way of operating as you think about what that really means. What does that mean to a fintech? What does that mean to a company that is, you know, thinking about creating a financial product? What are the what are the fundamental advantages that that come from building on that kind of core? [00:27:57][28.2]

[00:27:59] Yeah, that's a that's a great question. Last night I was I was talking to a group of startup founders in Hong Kong in a in an accelerator program program, and we were talking exactly about that. The advancements that I think companies like Circle is pushing to the market and and a lot of others are making and and now I think for perhaps for the first time, we are seeing, just as we have seen and you were touching on this on your on your in your monologue, the what we have seen with the early stages of the Internet and layer upon layer of protocol, investment and and sophistication of abstractions. Right. Until you get to a point where where people have messaging and to have social media profiles and they don't really compare that anymore to this or that protocol. It's all so far up in the stack for the first time. I think we are we are bringing that to fintech and to ultimately at every company that that might have an interest in, as I call in their app or product, have a balance somewhere. Right. And this is so, so broad. The other day I was playing a joke on my phone how many of those apps I have on my phone, how many apps on my phone I have about. Right, the financial system and you end up finding that there are things in there that you you don't expect right there is the apps that I use to to rent my my scooter in and around Massachusetts and various other things like that. I think I think the advantage now for these companies is that they have an alternative. They have an alternative when it comes to banking as a service and all these services that are companies or building blocks to building those solutions and embedding that into their products or services, they know they not have an option that is just just as sophisticated and abstracted from from user experience for them. Point of view. Right. Which means it's it's a good enough API. It's the abstraction is at the right level. It doesn't involve having to hire engineers that can code directly on the blockchains level and things like that. But obviously then so so they can represent money, store money, transact, but do that in a way that is connected to these public chains. Right. That are completely interoperable with a number of other services. And that just keeps growing global. Global by nature. Right. Very cheap and very effective to transact on. And that's that's a significant benefit. I think a lot of people still are not. What I mean people I mean entrepreneurs and and developers and technologists building these products and services around the world there are still not educated enough in how, you know, are almost on par with what you have in terms of quality of service with traditional banking as a service and Treasury as a service and payments. But but it's pretty much there. And it's a matter of when. [00:30:58][178.8]

[00:30:59] I think I mean, in some ways, the the the scalability, the security, the efficiency with just USDC on different blockchains, it's it's like a dramatic improvement over existing settlement systems. [00:31:13][14.7]

[00:31:14] And so, you know, really, I think if you're an entrepreneur and or an established fintech or a ecommerce firm or whatever, and you want to embed and integrate with how money moves from the Internet, like this is the place to start. [00:31:31][17.2]

[00:31:32] And then you kind of integrate out to to to the to the rest, I guess. [00:31:39][7.3]

[00:31:40] Rachel, I know we've seen as we've kind of beaten and rolled things out and and before this kind of full launch, we've seen a lot of different use cases for building on this, you know, many, many different industries. You know, just just talk for a minute about this. I mean, this is like a general infrastructure we see is as as valuable to a lot of different types of of firms. But just talk a little bit about what we've seen and what we think we're going to see. [00:32:09][28.7]

[00:32:10] Yeah. So over this year, I mean, we've seen hundreds of companies and signed up to use our services all across the world, spanning many different use cases. [00:32:20][10.5]

[00:32:21] I mean, these customers are truly highly global in nature. They spanned over thirty four different regions of where they're doing business, where their customers are doing business, and 70 percent of our customers are actually outside of the United States. That the core use case that we saw in the beginning of the year are our crypto finance peers, our crypto natives companies, both small and large building première wallets focused on savings and lending and exchanges and digital collectible use cases. These firms are looking to leverage us for accepting card payments, accepting bank wire payments with USDC as that settlement currency to be used in their own products. They're using us for direct USDC storage and custody and liquidity and our forthcoming high yield digital dollar account and APIs as well. We're seeing strong demand to complement that settlement and store value with high yield offerings for for their own corporate balance sheets or offering in turn to their users as well. But even beyond just crypto finance and just in traditional finance applications and companies, we are catering to banks, large, large banks who want to use USDC as another payment Rayle within their application. So just as they support an age or a swift wire, they want to be able to have a USDC payment option for either a small business or an end consumer. And FinTech as well, spanning B2B payments, cross-border and international payment, settlement savings and lending. Trade, finance, treasury and brokerage management. Digital securities. And we're just starting to see outside of finance, more broadly traditional commerce industries like a global freight operator that sees us as a superior method to paying their vendors and suppliers and cross-border payment operations of a company we like to see a lot is gig economy workers. Our city uses us for accepting card payments for a new economic model for for writers. And drivers all around the world are using crypto because they know that that will provide inherent benefits to getting paid and USDC to drivers and markets all over the world. [00:35:06][165.2]

[00:35:07] And so I think we'll see, you know, we talk about mainstream use cases outside of trading within the crypto industry a lot, it is happening and it's happening here at Circle and it's happening with USDC and it will continue to happen in twenty, twenty one. [00:35:22][15.3]

[00:35:24] Awesome. So I want to I want to drill into a couple of details to just maybe briefly and actually if you want to pop up the site, that's totally cool to just, you know, just talk about the the kind of capabilities that are there. [00:35:40][15.8]

[00:35:40] This is this very full suite that we've rolled out. And I think would would be cool to let me see if I need to give you special privileges here. [00:35:52][11.9]

[00:35:54] And I'm going to. I'm going to. You got it. All right. Cool. Excellent. Yes. [00:36:00][6.1]

[00:36:01] So that's the that's the fresh and awesome website that we have right now at the moment. All of Circle products, they they surround this core piece of capability that we call the Circle account. So we're just popping over there, which is, as we say, as we call it, the new financial account for global businesses. This is this is a hybrid, you know, and provide provides for businesses a have a product that obviously can navigate fire trails, but has its core component, sort of a Treasury management and almost like a banking solution for businesses where they can store value and transact across hybrid sales. As I mentioned, Fiat and Crypto, it's the core component of our products suite now. And in a lot of a lot of businesses have a ton of utility just from just from utilizing this. And this will get even better, as Rachel said, as we as we launch in early twenty, twenty one, our high yield account product, that that is sort of bound to that. And then the Circle account product is is is surrounded by by these API products. And I'll pop a couple of those. We have the flagship product on the API front, which is really our payments product, which allows customers to basically accept payments from a broad set of rails, whether they are traditional like cards and bank transfers or crypto like USDC payments and others in the future, but have this common API access across all of those in this common way of settling payments and and reconciling things like across a single API to take a card payment, take a wire, take a USDC payment. So it's crypto payments and and legacy rails and all of it sort of settles into this core Circle account as digital currency settles in core digital currency in a way that you don't need a bank account as is typically required as an accessory settlement instrument and pay-out instrument for for when you when you hook up into these kinds of more traditional services, you have this account. It's pure digital currency native with us. And obviously from then you can turn around typically and as you say, the follow the money approach. Right. Obviously, businesses are going to have a very different set of needs for that, for those funds, whether it is pay their employees, pay their suppliers. And obviously they have access to doing that in digital currency form, which which inherits all the benefits of that. So that's a tremendously interesting product that's getting a lot of traction with our customer base payouts is the next thing that we talk about. And this is effectively the opposite direction. Right. But obviously, a lot of businesses have this core need, which is I need to pay out several hundred, sometimes several hundred, several thousand entities, whether they are individuals or businesses, whether it is ad hoc or when one batch at the end of a month or something like that. And again, we support very similarly capabilities on the payment front, on the payout's front. So you can again issue payout's from your core Circle account in digital currency form, whether it is over Blockchains, RAYOS, reaching anywhere where the Internet goes or whether it is also through traditional rales such as wire transfers and things like so with the Blockchains rales. [00:39:20][198.7]

[00:39:20] Right. So you could push a payment to someone through a wire transfer, which is sort of the traditional way. But you can also push a payment to the digital wallet through USDC. And and now. Right, this is on on Ethereum, on Calgarian, on Salana and really soon on Steller and very likely many other chains over time. So you sort of have these public public infrastructures to kind of distribute out and and which have that global reach. [00:39:49][29.3]

[00:39:50] There's really there's really no no comparable in the world in terms of a product that does this, Fred, as you said, that has this this type of reach that we have with the sort of traditional Fiat rales that we have support for and we will keep adding support for, you can already reach north of 80 countries, but then it has all the quality attributes of Fiat rales, which we all know. And there is a lot of restrictions there. But you can you can also reach your customers or your entities that you need to pay out to in USAC form. And now, as you mentioned, a. Already four Blockchains, right, which which can vary in terms of quality attributes can vary in terms of ecosystem, it really depends on the interest that you have. But but this is creating a tremendous amount of value in terms of the network that that is accessible. [00:40:36][45.6]

[00:40:37] And this sort of ties back to my earlier comments. Right there are in almost every country in the world, there are wallet services, there are exchange services to go from USDC into local currencies, local bank accounts. And so but, you know, that exists that that global network of connecting through the open Internet to open standards and open protocols, it's growing fast and that exists. [00:40:59][22.7]

[00:41:00] And so essentially a business can plug into that. They can plug into, you know, beaming a payment to Korea, to India, to Argentina, to Mexico, know to to throughout Europe, all these places, and and do that over the open Internet. That's the profound part of this, which is which is such a huge improvement over the existing legacy payment system, not bound by banking hours 24/7. Yeah, I mean, it's what people come to expect from the Internet, like, oh, no, I can't send a text message. My career's turned off the Internet. Exactly. Yeah. I mean, yeah. [00:41:36][35.5]

[00:41:36] And again, it's it's a it's a it's an area that I think we are all very passionate about as well. Touching again on something you were talking about on your monola. Right. You can reach people with value that is useful and that has tremendous quality attributes when all they need to have is a phone and an Internet connection. Right. People talk a lot about serving the unbanked. This is actually putting infrastructure in place to allow businesses to build on top and effectively make that happen. So we're very passionate about that. Then then following the digital dollar accounts product, that's that's a tremendously useful product as well. I was I was making I was talking about the joke that I that I made with somebody looking at my phone and all the apps that have a dollar balance on it. This is essentially the kind of product that suits those types of applications. Right. Whether it is a peer to peer payments product that that an entrepreneur wants to build or whether it is a ride sharing service that somebody wants to build that is more innovative in nature if you have those products. But you have the need to hold a balance for your consumers and to allow them to transact with each other on platform or in and out of the platform. This is a product for them. This is a product that allows you to to create as many as flexible as you want an infrastructure for for some accounts that are connected to your Circle account. You can then transfer funds between your Circle account and all of those some accounts across them in and out on chain, across field rails. [00:43:05][88.6]

[00:43:06] Very, very this is that Treasury as a service. [00:43:08][2.3]

[00:43:09] Here you go, spin and customize it to your business model, have interoperability globally and obviously through payments of out connect to all the other places that you might want to connect to. [00:43:19][10.6]

[00:43:19] Right. Instead of it being tied to routing numbers, it's tied to blockchains the currency. [00:43:24][5.0]

[00:43:27] And then and again, connected to all these blockchains that USAC is already connected, right seamlessly, I mean, you can you can have a single account representing value for your customer that can receive USDC from Ethereum and send USAC to Solana on this one of Blockchains very seamlessly with the same set of APIs. And then finally, marketplaces, marketplaces is really an extensive an extension of the payments product for a more specific and more niche segment. Right. Which is the segment of particularly global marketplaces who who always have this at least dual sided but sometimes multisided element to it, where you have some some form of buyers in some some form of sellers in the marketplace, which you typically combine a lot of the a lot of the capabilities of our other products in an offering that suits marketplaces. Because typically these entities in a marketplace, they need an account to hold value right in the marketplace. As a buyer, you might have an account to pay for the things you want to buy. And as a seller, you have an account to receive, obviously from from from the goods or services that you're selling. But you also need infrastructure to get pains and pay in and out of the platform if you're interested in. And so we offer this product, which is again unheard of in the market, I think, in terms of the ability to cover the geographies that we cover because of the reach of the OCC across all the chains that are supported and this hybrid ability to take payments and make payouts also on across Fiat instruments. This is this is really, really powerful. And we we are seeing very good. We have a couple of tremendous customers in this product already and a lot of promise. We're trying to work for sure. [00:45:09][101.8]

[00:45:09] That's certainly that business model of this kind of multisided vertical commerce markets is is a is a really powerful one. I know. It's also one where in our in our partnership with Visa, there's a lot of focus on how do you how do you do payouts from these marketplaces to all the diverse types of of creators, sellers that are around the world. So some use cases there. I want to just quickly turn to to you, Rachel, and actually, if you want to put the site back up, actually, I think it's to help clearly communicate that now you've got it clearly communicate. You know, if I'm a business, what do I do? Where do I start? What does this cost? Is this straightforward? I think this is one of the most exciting things that we launched yesterday is is really trying to make this highly accessible to businesses and have them understand exactly what's involved financially. Let me know if you need to involved for sharing your job. [00:46:13][63.2]

[00:46:13] Maybe. Can you share the pricing screen? I'm having some issues with my setting. Yeah, we're doing it. But yeah, everything starts with that phrase. Circle account for four businesses that Joel walked through. [00:46:27][14.5]

[00:46:29] We support opening a Circle business account and over one hundred different countries. They can connect, convert, store USDC securely, make payments, generate yield, convert in and out of banks and use those third generation blockchains. [00:46:45][15.8]

[00:46:45] This is a free service or for any sites like custodies security soon high yield in and out from the banking system, multicam payments, all that's just like a free business account. [00:46:57][11.5]

[00:46:58] Yep. And this this will be the future digital dollar banking account. That company won't have to think twice about how to how to open and and manage their their funds and operations. [00:47:09][11.5]

[00:47:11] We imagine every Internet business in the world ought to have an account like this. [00:47:14][3.5]

[00:47:14] Probably, yes. And then on top of that, this is their financial infrastructure home. [00:47:21][6.2]

[00:47:22] So if they decided to either improve upon their Treasury operations or they want to start building apps and services and websites that deal with money, we've exposed API services built for automation, customization and integration for any kind that is connected to their Circle account for use case for money. These API services are available with subscription plans and usage trees that are super, highly competitive payments. Any business can accept traditional forms of payments from cars, cards, wire transfers, also USDC they sell directly to USDC it as in your Circle account. And that starts at a thousand dollars per month and you can scale with us as you grow. If you have high volume or need customization for different regions, then you can talk to a sales team and we'll we'll work with you on an enterprise plan. Similarly, if you go to our payout's, what I was just talking about, where you can automate payouts to customers, partners of. And use case again through traditional means, like bank wires, that starts at two hundred and fifty dollars a month, so it's very affordable, competitive, transparent, key value for us was to be able to use any single company to connect the dots to what their need is. And this is the product for me and this is how much it's going to cost. Similarly with our values, digital dollar accounts, the Treasury infrastructure for any commerce system that's significantly flexible and there's different types of customers and use cases and with our marketplace product making it really crystal clear that you can get access to our payments product or payout's product. But then for the additional features that are built for those specific marketplaces that are facilitating transactions between buyers and sellers, there's additional small fee on top of that. And then embedded across all of these will be high yield accounts in twenty, twenty one. And those will be included in their subscriptions as well. [00:49:37][134.8]

[00:49:38] That's awesome. And obviously, there's there's sort of the UKs dashboards and sort of things that are available to people as well while we're up here. And this may be the last thing to cover, as is very clear, like the concept here is you might have an account, but you're going to have people building apps on this like you want to. You want to automate things, integrate things. This is a developer led, right. So developers, web application developers and others can really build this into what you're doing with your business. And so the developer focus is really big. Maybe I'll just take a quick peek at the developer section and and what what that what that looks like. If you have a developer on your team, what do they need to know? [00:50:19][40.9]

[00:50:21] Yeah, we are we are all developers, I think even Rachel and I, I would like a guarantee. Well, I heard about that. I haven't seen the proof, but yeah, no, I'm kidding. I have I have personally quoted on on cold fusion, so I can attest to that. We we are all we have. We we always had a strong developer and software engineering DNA at Circle. Right. So we, we, we are heavy consumers of APIs. So when it came to developing these products, we always take a developer first mentality that data things surfaces in the way that we allow developers to to experiment with all of this infrastructure. So we have we have a sandbox environment that is openly available for everyone to try. If you don't if you are a developer yourself, you're not too fond of contacting sales and going through all of that. You don't need to talk to anyone. You can go straight to the sandbox environment. You can obtain an API key. All we need is your email address, obviously, to communicate with you. We give you access to the sandbox environment, which is like for like with with the infrastructure that we have on the live environments. Exactly. Exactly the same capabilities, exactly the same behavior. And it's actually connected to test nets across all of the blockchains where USC is is supported. So when Ethereum on Orgeron and soon on Salana and and steller, we always connect to to test nets. So we like to say that there is no better way now to build the USC fosset on all of these blockchains than to actually connect to our sandbox environment and utilizing ribeyes. But you can you can basically understand exactly how the services are going to work for you, you know, on the first fifteen minutes of utilizing our products. And then the second part is outside of the outside of the sandbox environment is obviously our API documentation, which we put a lot of effort on. There is there's an extensive set of over 50 guides in there walking people through, taking their first BEYMAN and making their first transfer, storing their first amount of value, and and obviously then the subsequent details of each product. There's a lot of content in there, but certainly enough for and we get very good feedback on this from from developers on our platform, certainly enough for people to get going on their first with. [00:52:44][143.5]

[00:52:45] I mean, said core message here is, you know, almost any business can can sign up for Circle account and get get immediate kind of benefits on a first party basis for for what they're doing. They can then immediately get their developers to to get access to our sandbox. In fact, developers can get access to the sandbox even without having the Circle account open. But but but nonetheless, developers can get in and actually build out whatever applications that they can dream up in these areas without even needing to contact our sales organization. And then when they're ready, they know the pricing is they know what it's going to be. They can get signed up and get launched in production and and go, which is which is pretty awesome. [00:53:26][41.6]

[00:53:27] Well, this is this is awesome. I'm really glad we could kind of walk through this. [00:53:32][4.7]

[00:53:32] I'm really excited for for everything that you guys have worked on and the rest of the Circle team. And just thanks so much for joining on this show today. [00:53:41][8.7]

[00:53:43] Yeah, thanks for having us. Thanks for having us. Absolutely. [00:53:45][2.3]

[00:53:49] So a big week, a big week for Circle, a big week for USDC, a big week happening for our industry as we speak. We're going to see what goes down in the next seven days and we'll have surely a lot more to talk about here. So until next time. Stay well, stay safe and stay informed. [00:53:49][0.0]


Episode Highlights

Jeremy discusses his open letter to the US Treasury, USDC & Open Blockchain Transaction regulations

Jeremy brings on Head of Growth & Head of Product of Circle to discuss new platform launch

Guests in this episode

Jeremy Allaire

Co Founder & CEO, of Circle and Director of Centre Consortium

Joao Reginatto

Head of Product, of Circle

Rachel Mayer

Head of Growth of Circle