Podcast Summary: Chit Chat Stocks – "A Fintech Expert On Stablecoin Disruption And The Future Of Digital Payments"

Podcast Information:

• Title: Chit Chat Stocks
• Host: Ryan Henderson and Brett Schafer
• Description: Researching stocks so you don't have to. New episodes are released every Wednesday and Friday.
• Episode: A Fintech Expert On Stablecoin Disruption And The Future Of Digital Payments
• Release Date: July 9, 2025
• Guest: Jev, contributor to the popular fintech newsletter Fintech Expert

1. Introduction to Stablecoins

The episode kicks off with Ryan Henderson and Brett Schafer introducing Jev, an experienced fintech professional from the Fintech Expert newsletter. They set the stage by referencing a thought-provoking question from a Twitter listener:

"What can stablecoins do for me?" (00:00)

Defining Stablecoins: Jev explains stablecoins as digital representations of traditional currencies like the US dollar or Euro on the blockchain. He likens their evolution to the transition from cash to digital money, highlighting how digital currencies have revolutionized transactions, enabling instant global transfers and higher yields through lending protocols.

"Stablecoins are essentially a representation of money on blockchain... It’s the essence of entering into the world of blockchains." (01:29)

2. Impact on the Average Consumer

The hosts pivot back to the initial Twitter question, seeking to understand stablecoins' real-world applications for the average person. Jev provides a balanced perspective:

"A fair answer would be not much at the moment... It's still a hypothesis that the barrier infrastructure and openness of the system can allow us to build better things." (04:07)

He draws an analogy with mobile phones, illustrating how foundational technologies often precede groundbreaking applications. Currently, stablecoins offer basic functionalities like instant cross-border transfers and participation in decentralized finance (DeFi), but their full potential remains untapped.

3. Stablecoins and Remittances

Ryan steers the conversation towards remittances, a sector ripe for disruption by stablecoins. Jev delves into the complexities of traditional cross-border payments, emphasizing the role of correspondent banks and messaging networks like SWIFT.

"Swift doesn't move the money. Swift is just a messaging network... the money doesn’t move across the borders; it kind of stays where it is." (07:37)

Comparison with Traditional Systems: Jev contrasts this with blockchain-based transfers using stablecoins, where money physically moves on the blockchain instantly, eliminating the need for multiple correspondent banks.

"When I send you stablecoins, the money actually does move instantly... that's the magic." (14:12)

4. On Ramps and Off Ramps

The discussion shifts to the infrastructure required for converting fiat to stablecoins and vice versa, known as on ramps and off ramps. Jev acknowledges the current limitations but remains optimistic about future advancements.

"In the future, there will be a process to buy stablecoins directly from issuers... and the cost of on ramps and off ramps will go down." (17:50)

He envisions a scenario where employers pay salaries in stablecoins, reducing the necessity for frequent conversions between fiat and digital currencies.

5. Stablecoins and Payment Networks

A significant portion of the conversation examines how stablecoins could disrupt established payment networks like Visa and MasterCard. Jev explains that these networks currently function similarly to SWIFT, using messaging systems with delayed settlements reliant on correspondent banks.

"Visa and MasterCard are somewhat similar to SWIFT. They are the messaging networks for you as a consumer." (46:16)

Potential Disruption: By leveraging blockchain's instant settlement capabilities, stablecoins could drastically reduce transaction costs and times, posing a threat to the traditional revenue models of these payment giants.

6. Adoption and Competition

Jev discusses the competitive landscape, predicting that major players like Visa might venture into blockchain to maintain their dominance. He speculates on Visa possibly launching its own blockchain, ensuring they retain control over the new payment infrastructure.

"Visa will actually launch its own blockchain... with the quality stamp of Visa, it will be super easy to decentralize it." (37:58)

He also touches upon the plethora of stablecoin issuers entering the market, each vying for compliance and market share, such as USDC by Circle and Tether.

7. Regulatory Environment

Addressing regulatory concerns, Jev notes the evolving stance of the US government, which has become more crypto-friendly. Legislation like the Genius Act paves the way for banks and fintechs to integrate stablecoins seamlessly into their operations.

"The current administration is very pro crypto... banks can do crypto." (43:29)

8. Fintech Adoption Challenges

A pivotal topic raised is the slow migration from traditional banks to fintech solutions, despite the latter offering superior services like higher interest rates.

"Why more people haven't moved... I think that in the US, it's still not like in Europe where we have more money institutions." (50:12)

Jev attributes this inertia to generational habits and a lack of compelling reasons for consumers to switch banks, despite clear financial incentives.

9. E-commerce and Payment Innovations

Exploring e-commerce's role in payment evolution, Jev highlights companies like Affirm and Ricardo Libre that have successfully integrated fintech solutions to enhance consumer experience during online purchases.

"Affirm is a great example... They are distribution kings, making deals with every retailer." (53:57)

He contrasts this with Amazon's hesitance to fully capitalize on in-built lending solutions, relying instead on partnerships with Visa and Stripe.

10. Future Outlook and Conclusion

As the episode wraps up, Jev emphasizes the transformative potential of stablecoins in reshaping global finance. He envisions a future where stablecoins streamline cross-border transactions, reduce costs, and foster innovative financial products beyond our current imagination.

"It's all about adoption... what will make people spend USDC instead of fiat and companies pay salaries in stablecoins." (44:58)

Final Thoughts: Ryan and Brett conclude by acknowledging the uncertainties but express excitement for the dynamic changes ahead in the payments landscape. They encourage listeners to stay informed and consider the implications of stablecoin adoption on their investment portfolios.

Notable Quotes:

• “Stablecoins are essentially a representation of money on blockchain... It’s the essence of entering into the world of blockchains.” – Jev (01:29)

• “A fair answer would be not much at the moment... It’s still a hypothesis that the barrier infrastructure and openness of the system can allow us to build better things.” – Jev (04:07)

• “When I send you stablecoins, the money actually does move instantly... that’s the magic.” – Jev (14:12)

• “Visa and MasterCard are somewhat similar to SWIFT... they are the messaging networks for you as a consumer.” – Jev (46:16)

• “Affirm is a great example... They are distribution kings, making deals with every retailer.” – Jev (53:57)

Conclusion: This episode of Chit Chat Stocks provides a comprehensive exploration of stablecoins and their potential to disrupt traditional financial systems. Jev's insights shed light on the current state of stablecoin adoption, the challenges ahead, and the transformative possibilities they hold for global payments and beyond. Whether you're an investor or a fintech enthusiast, this discussion underscores the pivotal role stablecoins may play in the future of digital finance.