CRYPTO 101 Ep. 702: The Hidden Friction Keeping Traditional Markets from Going Fully Digital with Yuval Rooz

Podcast Date: January 29, 2026
Host(s): Bryce Paul & Brendan Viehman
Guest: Yuval Rooz (Co-founder & CEO of Digital Asset, creator of Canton Network)

Episode Overview

This episode dives deep into the invisible barriers preventing traditional financial markets from operating in a truly digital, blockchain-native fashion. Bryce and Brendan host Yuval Rooz—co-founder and CEO of Digital Asset, architect behind the Canton Network—to explore the persistence of “analog friction” in global markets, why end-to-end digitization is so slow, and how institutional players are transitioning toward permissionless, digital-native infrastructures.

Yuval shares his journey from TradFi to blockchain, the design philosophy of the Canton Network, candid thoughts about RWAs, regulation, tokenomics, and the challenges—and opportunities—of bridging legacy institutions with crypto-native innovation.

Key Discussion Points & Insights

Yuval Rooz’s Background and Entry into Crypto (01:05–03:17)

• Yuval’s path: Background in electrical engineering and math, began career at Citadel, then became a trader at DRW; helped launch their venture arm and crypto investigations (2012-14).
• “I left DRW, which by the way owns Cumberland Mining, one of the largest market makers in the space, to start Digital Asset.” (01:31)
• The origin of the “Digital Asset” name: Bought the URL early (“Not sure if we paid $5,000 or $10,000… Greatest ROI trade in crypto history” – Yuval Rooz & Bryce Paul, 02:05–02:18).

What is a Digital Asset?—Friction in Traditional Markets (03:17–07:43)

• Analog process example: Yuval uses a Netflix anecdote to explain reconciliation in traditional finance—there are lots of “messages” but no real-time sync (“That very simple example is how financial services work today. We send a lot of messages... The reality is that we have no control or say over what the other party is doing…” – Yuval Rooz, 04:38)
• Friction consequences: Settlement takes time, costs mount, and end-users lose out on efficiencies (e.g., dividends take a month to settle).
• "A digital asset... is an asset that was born fully digital, has only digital representation and sits on rails where reconciliation is not needed." (07:38)

The Origin and Design Philosophy of Canton Network (13:29–17:20)

• Inspiration: Named after Swiss cantons; reflects federated, flexible architecture (team based in Switzerland).
• Design: Unlike most blockchains, Canton enables privacy and permissioning to be set at the application—not protocol—level, akin to having both Chase.com and shady websites on the same Internet, each with custom rules. “Applications are not homogeneous in nature... you have to give the creators... the freedom to dictate whether they are permissioned, permissionless...” (15:28)

Big Players, Big Assets—Institutional Adoption & Early Use Cases (17:20–23:08)

• Canton’s unique pitch: Not just about bringing Wall Street on-chain—“Everybody can own a piece of Canton."
• Why partner with institutions? “We wanted to bring the highest quality of assets to the network... depth of liquidity...” (20:18)
• Examples & scale: BNY Mellon ($60 trillion AUC), NASDAQ, DTCC, Broadridge bring tokenized deposits, repo, treasuries, annuities, and more.
  • "My team just sent me the information. BNY have $60 trillion assets under custody." (21:59)
• Crypto-native integration: After institutional onboarding, focus turns to building new financial products (e.g., real-time lending, secured loans, etc.)

Transition Pathways: Will Banks Run On-Chain? (23:08–25:03)

• Incremental transformation: Not full-stack replacements; for now, traditional banks (e.g., Chase) may have parallel applications on Canton but are in experimental, learning phase. “At the moment what these institutional players are doing is they're launching these products... learning what is the best way to offer these products.” (23:39)

Real World Assets (RWAs) – Distributed vs. Representative Debate (25:03–28:50)

• Definitions: “Distributed RWAs” put tokens directly in user wallets; “representative RWAs” use blockchain as a record.
• Yuval’s take: Disagrees with the delineation—focus should be on whether the ledger is the record of truth, not how assets are wrapped.
  • “Did we actually bring in any efficiency to the asset class? ...My view is no.” (27:13)
  • “I specifically don't find this delineation to be adding any value... that tells you that one is better than the other.” (28:38)

Is Canton Token (CC) “The New XRP Killer”? (28:50–31:57)

• Refutes tribal narratives: “Canton is the killer of nothing. Canton has a very specific mission, which is to bring capital markets on chain.” (29:26)
• Collaborative view: “I wouldn't be surprised if you saw Canton and Ripple or even other L1s collaborate... by actually focusing on each other's strengths.” (29:50)
• Not trying to "kill" other chains; every protocol serves different use cases.

The 24/7 Markets Shift: NYSE, NASDAQ & Implications (34:14–35:29)

• Major venues aim for always-on trading: "It's the ability to move our asset. Frictionless. 24. 7 is the big opportunity here." (34:44)
• Beyond just trading: True innovation will be peer-to-peer capabilities, lending, instant settlement, and new financial products that traditional rails can’t support.

US Digital Asset Regulation: Clarity Act (35:34–39:31)

• Yuval’s pragmatic optimism: Regulation isn’t strictly necessary, but clarity is essential for large institutions. Delays from regulatory ambiguity (“operation choke point”) have hampered innovation.
  • “If you are heavily regulated Institutional player. You just don't take those risks... the waiting list to get a meeting with the regulator... is about six to nine months. Inherently, that kills innovation.” (37:58–38:23)
• Sweeping takeaway: Clear law will accelerate adoption, but opportunity exists even before it’s passed.

Canton Tokenomics: Design Philosophy and Network Economics (40:27–48:45)

• CC is a utility token: Success measured by actual economic activity on the platform, not narratives or ghost chains.
• App developers vs. infra providers: Unlike most L1s, where infrastructure (validators, sequencers) earn the rewards, Canton seeks to reward those who bring value (i.e., app/utility providers). Yuval compares this to Visa/MasterCard rewarding card issuers.
  • “We wanted to have economics on the network that align with those that bring value to the network.” (45:28)
  • “If you bring traffic and volume to the network, we want you to be compensated for that." (45:57)
• No pre-mine, no founder token grants: “We did a fair launch... My token exposure comes from our equity holdings.” (46:46)
• Governance: No proof-of-stake; “super validators” (organizations adding value) govern the protocol. Disconnected from token ownership; designed for security and to prevent economic incentives from corrupting governance.

Addressing Security Risks for RWAs (48:05–48:45)

• On proof-of-stake risks: Questions security model when RWAs' value vastly exceeds the network token's value – potential attack vector in “$100B network securing $100T assets.”
• Canton’s approach: Governance by contributing organizations, not by token holders. “The governance of the network is disconnected from the financial ownership of that network.” (48:45)

Top Innovators in Crypto—Who Is Yuval Watching? (48:59–49:47)

• Yuval’s picks:
  1. Lily (Head of Solana Foundation)
  2. Mike Cagney (Founder, Figure)
• Both cited for execution and driving real activity: “Good execution and actually driving activity really results in success. And I think we need more people like that in this industry.” (49:33)

Final Thoughts and Closing (50:50–51:38)

• Yuval’s advice: “Eventually utility wins, right? Like, eventually the laws of physics will win and whoever brought actual utility to their network will win long term.” (51:04)
• Where to learn more:
  • X (Twitter): @cantonnetwork
  • Website: digitalasset.com
  • Foundation page and Yuval’s handle @evolvers

Notable Quotes & Memorable Moments

• On analog process in finance:
  “We send a lot of messages to one another... The reality is that we have no control or say over what the other party is doing on the other side.” – Yuval Rooz (04:38)

• On the flaws of ‘digital’ in today's capital markets:
  “You log into your brokerage account... you think, well that's a digital asset, right? But... there's a lot of analog things going on behind the creation and the trading and the settlement of that.” – Bryce Paul (03:17)

• On true digitization:
  “A digital asset is... an asset that was born fully digital, has only digital representation and sits on rails where reconciliation is not needed.” – Yuval Rooz (07:38)

• On Canton’s non-homogeneous architecture:
  “You have to give the creators... the freedom to dictate whether they are permissioned, they are permissionless. Do they have privacy?... All the shades of gray in the middle.” – Yuval Rooz (15:28)

• On incentives and network economics:
  “For us, what we wanted to do is... have economics on the network that align with those that bring value to the network.” – Yuval Rooz (45:28)

• On security for RWA on PoS:
  “If now suddenly the Network is worth $100 billion and the RWA on it is worth $100 trillion, well, maybe it is worth disrupting that network.” – Yuval Rooz (48:14)

• On innovation and utility:
  “Eventually utility wins, right? Like, eventually the laws of physics will win and whoever brought actual utility to their network will win long term.” – Yuval Rooz (51:04)

Timestamps for Key Segments

| Time | Topic | |-----------|----------------------------------------------------------------------------------------| | 01:05 | Yuval Rooz’s TradFi journey and genesis of Digital Asset | | 03:17 | What’s a “digital asset”? Unpacking analog friction | | 07:38 | Defining digital assets: “born digital, no reconciliation” | | 13:29 | Naming & philosophy of Canton Network | | 17:20 | Institutional integration: Why partner with BNY, NASDAQ, etc. | | 21:59 | Scale: BNY Mellon holds $60 trillion AUC | | 23:08 | Pathways for banks: Traditional + on-chain approaches | | 25:03 | The RWA debate: Distributed vs. representative; Yuval’s perspective | | 28:50 | “XRP Killer?”: Canton’s real mission | | 34:14 | 24/7 markets: The NYSE/NASDAQ shift and its true impact | | 35:34 | The Clarity Act: Regulation, innovation, and institutional onboarding | | 40:27 | The CC token: Utility, design, and network economics | | 45:28 | App fees vs. infrastructure: Who gets rewarded in the Canton economy? | | 46:46 | Token genesis: Fair launch, no pre-mine, super validator governance | | 48:59 | Yuval’s picks: Crypto innovators to watch | | 51:04 | Utility as the ultimate winner | | 51:38 | Where to learn more—Wrapping up |

For more info:

• X: @cantonnetwork
• Web: digitalasset.com
• Host: Bryce Paul, @Bryce_Paul_ on X

This summary captures the core content and insights from CRYPTO 101 Ep. 702, skipping all advertisements and non-content to highlight only the most relevant discussions and perspectives from the episode.