Loading summary
Transcript23 lines
- [00:01]
Indeed Advertiser
You just realized your business needed to hire someone like yesterday with Indeed. There's no need to stress you can find amazing candidates fast using Sponsored Jobs. With Sponsored Jobs, your post jumps to the top of the page for your relevant candidates so you can reach the people you want faster. And just how fast is Indeed? Well, in the minute I've been Talking to you, 23 hires were made on Indeed according to the Indeed data worldwide. Seriously, there's no need to wait any longer. Speed up your hiring right now with Indeed and listeners of this show will get a $75 sponsor job credit to get your jobs more visibility@indeed.com wonderyus just go to indeed.com wonderyus right now and support our show by saying you heard about Indeed on this podcast. Indeed.com wonderyus turn terms and conditions apply. Hiring Indeed is all you need.
- [00:59]
Jose Fernandez Deponte
A large part of our audience, we are their first crypto experience and we want to continue to do that. The uniqueness of our platform is the ability to bring more than 400 million consumers and merchants into into the new space. We take that responsibility very seriously. It is definitely part of our communications and we want to continue to have that in our messaging.
- [01:16]
Jen
Yeah. Stablecoins are heating up again as the US eyes a stablecoin bill payments giant. PayPal launched its stablecoin in 2023 and is now offering incentives for PyUSD holders. PayPal's SVP of blockchain, Jose Fernandez Deponte joins us now. Jose, welcome to Markets Daily.
- [01:43]
Jose Fernandez Deponte
Hello Jen. Thank you for having me. Happy to be here.
- [01:46]
Jen
Of course. Thanks for being here. It's been a big week for PayPal. I know two big announcements came out recently. First being this 3.7% annual yield on PY USD. So I want to talk to you about how I imagine that this, this came out because you are thinking about being competitive with other stablecoins out there. So let's start here. How are you hoping to remain competitive? How are you hoping to grab that market share from other stablecoin issuers?
- [02:14]
Jose Fernandez Deponte
Yeah, a lot to unpack on what you said, Jen, and on our rewards program. But if you take a step back and you look at what we are trying to do there, we're trying to do three things and everything that we announced you should be able to put into one of those three buckets. We're trying to increase mainstream access to digital currencies broadly and a few weeks ago we started adding support for Solana and Link and more tokens outside of stablecoins. The second bucket is we are trying to make our stablecoin PUSD as available and as you were saying, as competitive in the market as we possibly can for crypto audiences. And absolutely, the rewards program is part of that. And the third bucket is we want to make PUUSD the best stablecoin for payment use cases. And a lot of work we have been doing on mainstream payment use cases goes in that direction. When we talk to our consumers on the PayPal and Venmo side, the two things that they constantly ask the most is, hey, we'd love for you all to add more tokens to the Support on the PayPal and Venmo platform. And the second one is we would love to have some way to get rewards on the assets that, that we hold. That's the reason that we went in this direction. We have been trying, all of us in the industry, I think we have been trying to solve the cold start problem for stablecoins. Right? There is a very clear use case and very clear value proposition in crypto capital markets. There is a very clear proposition for merchants and consumers. But the question continues to be, how do you get users in the most advanced payment markets like the US like Western Europe, to adopt stablecoins for payments? And this is one of the ways in which you can try to break that comprehension problem and get folks who are not hardcore crypto audiences to start to adopt and try the stablecoins. I don't think that this is about market share stealing market share. Stablecoins are 250 billion today in market cap, give or take. I think that the main impetus for all of us in the industry is let's make this 1 trillion. It's going to be plenty of space to grow the piece.
- [04:11]
Jen
Well, you know, you bring up something important there. It's how do we get people in established markets who already have working payment systems to use stablecoins? And I imagine that you probably have a big marketing push on the back of the annual yield that was just announced. Can we expect that to come? Can we expect that to come out and entice crypto newbies who might be looking to get some yield that they're not getting from, let's say, their savings account at their bank?
- [04:38]
Jose Fernandez Deponte
Let me go back, because wording is important. This is very much a rewards program that is not a yield program. So the way that we are thinking about those rewards and communication, you have been seeing already this year a relevant marketing push. On the PayPal side, we recently ran a very large sweepstakes campaign. We are seeing more and more Interest from our folks, from the traditional users of PayPal and Venmo in digital currencies from the very beginning. We've been doing this now for six years, five years now. We have seen PayPal as one of the gateways, one of the conduits in which people adopt digital currencies and still to the day a large part of our audience. We are their first crypto experience and we want to continue to do that. I think that's something that the uniqueness of our platform is the ability to bring more than 400 million consumers and merchants into the new space. We take that responsibility very seriously. It is definitely part of our communications and we want to continue to have that in our messaging. Yes.
- [05:36]
Jen
Now I, I got to ask you, PayPal is something that's used globally. Are you exploring stable coins that are non USD stablecoins?
- [05:44]
Jose Fernandez Deponte
The question on non USD denominated stablecoins is a very pertinent one. As you know, the vast majority of stablecoins today are denominated in in USD. The big reason for for that is that still the default use cases for crypto capital markets and crypto capital markets are denominated in in USD. We are way more interested in mainstream payments and if you are interested in mainstream payments, those are going to happen in the currencies where people do their day to day transactions. I do believe that we will see stable coins appearing in the largest trading currencies out there and hopefully there's going to be a universe in which you see stable coins denominated in pounds and euro and Japanese yen and many others. We don't need to own stablecoins in each and every of those. The important thing is that stablecoins are issued on permissionless chains that are interoperable so that our users can move quickly from one chain to other chain and from one currency to another currency.
- [06:40]
Jen
Now one of the announcements that you had this week had to do with Coinbase, a Coinbase partnership and part of that announcement was a commitment to explore defi and on chain use cases for PyUSD. I want to get inside your head a little bit. What are some of the most exciting defi use cases that you're exploring right now?
- [07:02]
Jose Fernandez Deponte
We are seeing adoption in what you would traditionally define as DEFI in lending pools and indexes. As you see the emergence of things like what is getting called now as PayFi and you're seeing more and more people using stablecoins for trade finance and people have been able to borrow for commercial purposes in stablecoin that's something that is very, very interesting for us. It's something that we expect to see. Some of that is happening in the Ethereum universe, some of that happens on the Solana universe by design. We have always seen that we want to be a multi chain so we will be exploring areas on where those ecosystems and others where people are starting to use defi. But again, the closest that you are to commercial activity and payments activity, I think that is one of the places where we can help the most. We will always be an option for traditional crypto capital markets. That's one of the places where the announcement with Coinbase today is so highly relevant. We have a really, really good access to retailers and merchants. Coinbase has really, really good access to institutional investors. And for those investors, this idea that you can move between Fiat and a stablecoin with no fees is super important. Even a few basis points matter a lot when you're moving very large amounts of money. And I think that the market is ready for choice and more options and the ability to do that with more stablecoins.
- [08:23]
Jen
You know, if it. If I look at the conversations I've been having this year on on CoinDesk, the two main themes have been stablecoins and regulation and I want to ask you a little bit more about that. But first I want to mention that you will be joining us at Consensus. I believe that those two themes I just mentioned are going to be dominating themes at Consensus this year. Can you give us a little bit of a preview of what you'll be talking about and what we can expect expect from the conversation you'll be having on stage?
- [08:55]
Jose Fernandez Deponte
Absolutely. I'm so looking forward to being in Toronto in a few weeks. Yes, we have a fantastic panel. I'm going to be on stage with Anthony Suhu from Monogram and Mackenzie from CNBC is going to be moderating the panel. The theme of the panel is are stable coins really the future of global payments? You have me on the stage with that question. It's a little bit of a leading question. I think that yes, stablecoins are the future on global payments and hopefully we can bring that to life and have a really good conversation. Remittances is something that obviously both Anthony and I are very passionate about, but we want to take it beyond that and talk about mainstream payments, merchants, B2B payments, invoicing, all that good stuff.
- [09:36]
Jen
You know, I have to ask you, remittances, that's the killer use case for stablecoins. I think everyone can agree there. You're really trying to break into the consumer payment environment with stablecoins. Of course, PayPal has already broken that in multiple different ways. What are the challenges that still exist for you in developing this use case?
- [10:01]
Jose Fernandez Deponte
So remittances are absolutely one of the use cases, something I care really deeply about and a number of components. I'm an immigrant myself, something that I care deeply about and I have the benefit of also managing Zoom, which is our remittance platform. The big thing going back to awareness, trial conversion, the big thing is can we put value on the table for consumers? The answer to that is yes. We are already moving away from transactions, from transaction fees for people using a stablecoin. The second is for those who are not ready yet to do that comprehension gap between I'm paying with my bank account to I'm paying with stablecoins. Can we still deliver value? And the way that we are doing that is by using, using stablecoins and remittances as a settlement layer, meaning that I can still send money to my family in Spain using my bank account. My family still can receive that in their bank account. But the settlement layer, instead of going through Swift Network and all of that, we are moving dollars into stablecoin, pushing stablecoin out to Europe, doing the last mile conversion dollar to euro. So we abstract a lot of complexity for consumers who are not ready for that yet. But we are still being able to provide them with the speed and the cost and the advantages of of stablecoins. I do believe that you're going to see a lot of that experiences that are the consumer facing or the business facing. Part of it is is fiat to fiat. But stablecoins are happening in, under, under the hood because in the end they are digital dollars. Digital dollars should be fungible. People ideally should not even care.
- [11:31]
Jen
Now I want to shift the conversation over to regulation for just a second. Everyone is hoping that a stablecoin in the United States this year. Talk to me about what you're watching on that front. And is PayPal engaging with any policymakers?
- [11:46]
Jose Fernandez Deponte
So as part of our everyday activity we interact with regulators and policymakers in many of the institutions on the geographies where we operate. We have always saying that it's important that the US that there is clear regulation of the space. One of the reasons that we went to our friends at Paxos and we established a trust in New York is that New York had a really, really strong and very comprehensive regime for stablecoins. And it's going to be fantastic that something like that is extended to the whole country. So the bills in Congress are incredibly important for the establishment and the growth of the sector in the US and not only for the industry types, but also for more traditional financial institutions. You would not imagine the amount of interest of many of the folks who traditionally have been looking at it from the sidelines and saying, hey, this is a stablecoin thing. Yes, seems interesting, but the regulation is not very clear. We're getting mixed messages about it and now all of a sudden saying, hey, there is likelihood of bills getting passed in the next months. What do we do? One of the most frequent conversations that I have these days with traditional financial institutions is we are thinking about our stable strategy and how we should. I think that some folks, you'll see new folks who are issuing stable coins, you're going to see new folks who are distributing stablecoins for others. Ideally you're going to see folks who are entering in the custody space. Again, getting this out of just the hardcore nucleus of people who are really interested in crypto and getting that into people who have a bigger perimeter where they can add more users is going to be super important. And that passing of those bills is going to be a relevant one. So we keep a ton of attention on that. We expect that it's going to be a, a getting to, to a good place soon. It's very, very important.
- [13:35]
Jen
Jose, you said earlier that you expect the stablecoin market to grow exponentially and there to be room for multiple players with legislation being passed. And you just alluded to, you know, more players coming to the market, more stablecoin issuers issuing these assets. Do you think we're going to see a consolidation at some point? Like why do we need all of these US dollar based stablecoins? Are there just going to be a few winners in the future?
- [14:02]
Jose Fernandez Deponte
I actually think I might be totally wrong. I think that we're going to see a fragmentation. I think that sometimes there is a narrative in the sector about concentration because the sector is very with market cap and the size of the asset base. But that is all important for two reasons. Because the traditional monetization model has been yield on the reserve of the assets of the stablecoin and because market cap is a proxy for liquidity. And liquidity is obviously very, very important. I think that as you get more issuers. But if you're interested in the transaction side of it, I'm way more interested in transaction velocity on how fast the stable coin is circulating than on size per se. And I think there are going to be others who are going to see that the same way because there are other ways in which we can monetize the stablecoin. So I do believe I don't think there's going to be there are going to be 300 stablecoins that matter. I don't think that that's the case. I don't think there's going to be three. I think that there's going to number in the low double digits that make sense. Maybe there are 10 or 20 that matter and the important one is that they are very interoperable. Again, that's why we think that for the community the fact that people are building on permissionless chains and there is open source technology is very important because ideally consumers and merchants should not care a lot. They should be able to do I'm going to use this stablecoin. Let me push my own I'm going to use PUSD for payments because I really care about payments and it's a really good one for payments but for my treasury needs I'm going to be using something that is better for capital markets and I'm going to move very seamlessly from one to the other. If you think of transaction velocity, you can do billions of payments volume with hundreds of millions of stablecoins and again it's about how fast it moves. So I think that, I don't think that is I don't want to dismiss network effects that are important and I think there is a minimum scale that makes sense. That's why I don't think that you will see 300 stable coins that matter. But this is not a winner takes all game. I think there are space for for a relevant number of players.
- [16:01]
Jen
Jose, thanks so much for joining the show and we will see you in Toronto at Consensus.
- [16:06]
Jose Fernandez Deponte
Looking forward to CG in Toronto. Jen, thank you so much.
- [16:12]
Monster.com Advertiser
Are you feeling stuck in your career or lacking employment at the moment? Experiencing symptoms of job dissatisfaction? You might be suffering from a common condition known as career stagnation. But don't worry, there's a solution. Monster.com Monster.com offers a comprehensive suite of career boosting tools designed just for you. Our free resume review and AI interview prep tool will help you stay stand out from the crowd. Need more guidance? Dive into our career advice articles for expert tips and insights and don't forget to check out our salary tools to ensure you're getting paid what you're worth. Side effects may include a new job, increased confidence and a brighter future. Consult monster.com today and take the first step towards your new career. Ready for your next job opportunity, visit monster.com now.