Stripe’s Trillion-Dollar Bet: How Stablecoins are Rewriting the Global Payments Landscape

Original Title: Stripe‘s Trillion-Dollar Bet: How Stablecoins Eat Global Payments

Original Source: Bankless

Original Translation: Ismay, BlockBeats

Editor's Note: In many crypto narratives, stablecoins are often seen as supporting characters. They may not be flashy or offer massive returns, but they persist behind almost all transactions and payments. This conversation shifts the focus to the true stage of stablecoins.

Zach Abrams has a unique background. He has experience in private equity and fintech companies, participated in the productization of USDC at Coinbase, later founded Bridge to turn stablecoins into API-based payment infrastructure, and ultimately sold the company to Stripe in 2023. He witnessed the journey of stablecoins from skepticism to gradual acceptance by fintech, corporations, and governments.

There are three key points worth noting in the interview.

First, the engineering challenges of payments.

While the narrative around stablecoins is often grand, when it comes to payment scenarios, it boils down to mundane problems like "how to pay thousands of people simultaneously." Bridge encountered challenges such as sending tens of thousands of aid payments on Stellar, taking eighteen hours to process a portion, accompanied by numerous failures. They also faced the cost of preloading SOL amounting to hundreds of thousands of dollars to onboard wallets for millions of users on Solana.

The real challenge is to keep the system stable under these real-world loads.

Second, Tempo's positioning.

Under Stripe's guidance, a chain called Tempo, an EVM-compatible blockchain, is being built, emphasizing high throughput, sub-second finality, and privacy. It is a chain tailored for payment scenarios, not for trading or speculation. Stripe does not see it as a private chain but aims to turn it into shared public infrastructure.

Third, the market structure of stablecoins.

Zach's assessment is that in the future, there will be a very small number of branded stablecoins, such as USDT and USDC, which will continue to exist based on liquidity and the network effects of trading pairs.

However, at the same time, many companies will launch their own internal stablecoins for fund transfers, settlement, and revenue distribution.

Imagine the internal fund flows of Walmart or Robinhood, which may not necessarily rely on USDC but could completely use their own issued "company dollars." In this scenario, the role of a clearinghouse would become crucial, as it could perform end-of-day reconciliations between different stablecoins.

The discussion also extends to possibilities in the next five to ten years, such as whether local currency stablecoins will fill the gap left by the US dollar, whether AI agents will become the largest stablecoin users, and whether banks in the new system will gradually retreat to purely a clearing layer. These questions do not have answers today, but they are gradually becoming part of our reality.

The greatest value of this episode lies in providing a pragmatic perspective. Stablecoins do not need to be exaggerated or hyped; their significance comes from the most mundane fund transfers. Whether it's Stripe or Bridge, what they are doing is enabling these funds to reach their destinations faster, cheaper, and more reliably. It is this seemingly ordinary goal that may determine the shape of the future payment system.

The following is the original transcript of the conversation:

Ryan: Welcome to Bankless, a program exploring the frontiers of internet money and internet finance. I'm Ryan Sean Adams. I'm here to help you get closer to a "bankless" future.

All fintech companies will go through what I call "crypto transformation." Stripe is one of them. This is a private payment giant valued at $90 billion, handling annual payment volumes equivalent to 1.3% of global GDP. They are undoubtedly at the forefront of this crypto transformation, and their actions are very rapid. They have made significant investments in stablecoins. Following the recent passage of the Genius Act, they are doubling down.

A key figure in driving Stripe's transformation is Zach Abrams. About a year ago, Stripe acquired for over $1 billion his stablecoin company, Bridge, which he founded. Since then, they have made more acquisitions related to crypto, including companies like Privy.

This conversation with Zach gives us a glimpse into how large fintech companies are approaching this transformation and how they will evolve in the future. It's a discussion that is completely different from our usual crypto-native perspective on Bankless, making it particularly valuable. It's also Zach's story—a resilient entrepreneur who formed his own conclusions about stablecoins and persevered through very challenging times, ultimately leading the company through this significant acquisition.

Shortly after recording this episode, Stripe announced some new information—they are supporting a new Layer 1 project. Some in the community have referred to it as "Stripe Layer 1." However, our guest explained that it is more like a permissioned blockchain, named Tempo, which is an EVM chain driven by a group of fintech companies.

We also discussed why they did not choose to follow the traditional path of becoming a Layer 1 or Layer 2 solution. The bigger question is: What is the next step for Stripe in the crypto space? And how will every fintech company respond? Today, Zach Abrams will help us answer these questions. So let's dive in.

We are very pleased to introduce our guest today—Zach Abrams. Zach, welcome to Bankless. First of all, I have to say at the outset: Congratulations on selling your co-founded company Bridge to Stripe. The deal was announced last October, if I remember correctly. The acquisition is rumored to be over $1 billion—I don't know if you can confirm that rumor, but in any case, it was a massive acquisition for Stripe. Your company has also become a crypto unicorn as a result, which is truly amazing. Congratulations once again.

Zach: Yes, thank you very much. A lot has happened since then. It feels like a hundred years have passed.

Ryan: Yeah, I've always found it interesting that Stripe acquired a stablecoin company before the Genius Act. You know what I mean? They bought a stablecoin company before the act was passed, how forward-thinking is that?

Zach: Well, you know, that was before the election, and a lot of things started to change at that time. Strictly speaking, it was before Genius, and also before many other things. But I think the most important point for them, and for us, was: you could already see that this thing was working. It was changing very quickly. Two or three years ago, its performance was quite bad.

Ryan: You mean the overall situation, right?

Zach: Yes, yes, from a business perspective, looking at the overall development of stablecoins. Back then, we also went through the events of Terra, Luna, and FTX.

Ryan: Oh, right, I almost forgot.

Zach: Yeah, it does look like a distant past now. But at that time, some effects were already starting to show. There were already real payment companies and fintech firms building products based on what we were doing. If you squint into the future a bit, you can vaguely see how important it will become.

Ryan: Yeah, that's fascinating. I think that's the genius of the Collison brothers. They always seem to be able to squint into the future and bet on the right thing this time. I want to chat about them in a bit, but before that, let's talk about you. Can you tell us about your experience as a crypto entrepreneur? Feel free to start from anywhere. How did your journey begin? And how did you end up here, working at Stripe and completing what might be a billion-dollar acquisition?

Zach: Well, for me, this journey started in a place that might be different from most crypto entrepreneurs — in automotive parts.

When I graduated from college, my goal was actually to become an operating partner at a private equity firm, which sounds odd, right? I was interested in turnarounds and driving revenue growth. So I joined a private equity firm that in 2009 had acquired some distressed businesses. The automotive industry was in turmoil at that time. We acquired an automotive parts company, and I, a 22-year-old, was sent to be the CFO of this company.

But that experience was pretty rough. You can imagine, a 22-year-old kid, more like a bookworm, being sent to Canada to tell all the workers in the factory that we're shutting down the plant there. Then being sent to Mexico for a ribbon-cutting. I thought, this is not at all what I want to do. I wanted to "create," and this was the opposite. So I left private equity. Around that time, I heard that people on the West Coast were starting to do startups. I went to Duke, and when I graduated, there were probably only seven or eight true computer science graduates from Duke.

Ryan: What were all the others studying then?

Zach: Mostly economics, going into investment banking after graduation and such. So there was really no entrepreneurial vibe around me. So I decided, you know what, I'll do it myself. I thought I could. The first company I wanted to start was actually a "buy now, pay later" model, kind of like Klarna or Affirm, but that was back in 2010. Doing that type of business then was probably the hardest: you had to secure big partners and deal with credit, fraud, risks, and a bunch of other troubles.

When I went to raise funding, I thought the process was like this: first, create a PPT, approach VCs, they give you money, and then you hire an engineering team to build the product. However, after running around VC offices, all I got was: show me the product first. That moment was when I was utterly disappointed.

Ryan: So you weren't originally an engineer? You didn't study computer science either?

Zach: Right, I had never studied computer science, didn't know what engineers did, didn't know what designers did, and had no idea what a product manager did. It's safe to say I was one of the least suitable persons for entrepreneurship. Then I went through a painful year: trying to start a company, only to realize I had to learn how to code first. So, I went to a coding school in New York. Later, I found out I needed a co-founder, so I started what they call "co-founder dating." Imagine this, it's like going to a bar where there are a hundred people like me, and only one engineer.

Ryan: That one engineer became the most popular person.

Zach: Exactly. Later on, I finally met Sean, who is now my co-founder at Bridge. He also graduated from Duke. I met him about nine months into this journey, and I persuaded him to start a company with me. After that, we finally got funding and started to gain some traction. Then I moved to the West Coast, but that company ultimately didn't succeed, and we sold it to Square. However, that's why I started on this path, even though the starting point was entirely different.

Ryan: So, this led you into the fintech track. Even though selling the company to Square may not be considered a great success, at least it freed you from the pain of entrepreneurship, sort of an exit. After that, you not only worked at Square but also had experiences at Brex and Coinbase. So, your resume shows a background in both fintech and crypto.

Zach: Yes, absolutely right. In reality, every time I've looked for my next job, looking back, I've truly been interested in fintech. In theory, I had a bunch of options in front of me, but every time I ended up picking from the same category on the menu, which is fintech companies.

Around 2016, I applied to join Coinbase. I was really excited about cryptocurrency at the time. In fact, when I first moved to San Francisco to start Evenly (our first company), Bitcoin had surged to $1,000, and then crashed, around 2012 or 2013. That was also the first time Sean and I bought Bitcoin.

Back then, we also attended various gatherings where everyone was discussing mining, hardware companies, and all sorts of new things revolving around Bitcoin. These experiences sparked my interest in crypto. By 2016, after I had left Square, I had a very strong sense of excitement, feeling that this would become a very important thing. I can't pinpoint what triggered this feeling, but I just felt that something significant was going to happen in the future.

So I joined Coinbase. At that time, the company had about 60 to 70 people. You see, Coinbase is a very peculiar company. It's not like today's startups where they can have 70 employees in three months. At that time, Coinbase had been around for about five years, and when I joined, I was employee number over 200, but in reality, there were only around seventy people in the company. This was because Coinbase had gone through many transformations and directional shifts in the past.

At the moment I joined Coinbase, it happened to align a bit with Stripe. At that time, Coinbase had just realized that using Bitcoin for internet payments and shopping would not be the next big trend. Their biggest customers at the time were Stripe and Overstock.com.

Ryan: So, at that time, Stripe was also using Coinbase?

Zach: Yes, at that time, Stripe was using Coinbase for the "pay with Bitcoin" feature. It was around the time I joined Coinbase that we gradually realized that perhaps this was not the future direction. What really had potential was the exchange model—buying and selling crypto assets on an exchange, which could develop into a significant business.

Then in 2017, everything changed. Coinbase went from being a very niche company to almost overnight becoming one of America's mainstream financial services companies.

During this process, one of the last major tasks I worked on at Coinbase was USDC. Although the actual technical implementation of USDC was handled by other teams, I was responsible for Coinbase's consumer-facing business at the time. Our goal was to find use cases for USDC and make it useful. It was during the productization of USDC that we began to form a view: it could potentially become the first globally accepted store of value.

We also thought about turning Coinbase Consumer into a product similar to a neobank, doing a lot of exploration around USDC, but ultimately, we couldn't make it a reality. After that, I left Coinbase and joined Brex.

Ryan: So you returned to the FinTech field and then founded Bridge?

Zach: Yes, that's correct. Leaving for two years actually helped me—it gave me time to reflect and also see many of the challenges Brex was facing. At that time, Brex was looking to expand internationally, and I had worked on many related products and could clearly see that some local problems that had already been solved in developed markets were simply not addressed in an international context.

Ryan: Zach, your resume is quite interesting. You have a background in both FinTech and crypto, and you eventually founded Bridge. You are one of the few who can bridge the two worlds. My observation is that many traditional FinTech professionals are skeptical of crypto, while many in the crypto community either do not understand or disregard FinTech. As a result, both sides have been operating independently: on one side is crypto, on the other side is FinTech.

I believe this cycle is starting to change, perhaps starting around 2023, with the trend becoming more apparent by 2025: FinTech and crypto are moving towards integration. The financial world and the crypto world— are they truly different and will remain so, or will they eventually converge? I think this is one of the key themes of this episode.

How did you bridge this gap? You are in FinTech, but not entirely skeptical of crypto; conversely, you are also in crypto but understand FinTech. What did you see that others in FinTech did not?

Zach: Firstly, I fully agree with the premise of your question. I think that when we founded Bridge, one of our biggest unique advantages was that we were in the middle. We had a deep understanding of the financial system, while also acknowledging the potential of crypto technology. This kind of combination is very rare. Of course, there are more now, but at that time, I felt we were almost the only team truly standing at this intersection.

Either you are someone who almost "believes" in crypto, thinking that the existing financial system is entirely flawed and will inevitably be replaced, or you are in the traditional financial system, believing that crypto is purely speculative, or even absurd.

Ryan: Scams, money laundering, drug trading, crazy JPEGs—all speculation, with no substance at all.

Zach: Exactly. And the overlap between these two circles is extremely small, but it is precisely this intersection that has created an opportunity for us. This made it very challenging at the beginning. Because we were standing at this intersection, we had to deal with banks and sell our products to non-crypto companies. This made the early days particularly tough because there was simply no one else in this position at that time. Even today, the challenges persist, but the situation has improved significantly since then.

Ryan: You founded Bridge in 2022, right? That was quite a dark time for crypto, wasn't it? 2023 was no different. All the accumulated momentum and public goodwill towards the crypto industry crumbled with the collapse of Sam Bankman-Fried and FTX. The subsequent selloff and the political goodwill needed to drive stablecoin legislation also evaporated.

Of course, Bankless listeners are well aware that in the following years, we saw the 'Choke Point Operation' and a series of crackdowns. In such times, you were building a bridge between traditional finance, fintech, and crypto. What was that experience like?

Zach: It was as bad as you described, if not worse. Let's not forget that Terra Luna also went bankrupt at that time. It almost cast a shadow over the entire stablecoin space. Meanwhile, a group of so-called 'crypto-friendly banks' also went bankrupt. Those institutions straddling both worlds almost all faced consequences. Signature and Silvergate went under.

Ryan: That was probably in early 2023, right?

Zach: Yes, early 2023. There was also a bank called BankProv that many didn't talk much about. It was also one of the crypto-friendly banks that extended large loans to Bitcoin miners, and those loans suffered significant losses, leading to the CEO being ousted. Almost everyone at this intersection point was punished to some extent.

For us, one point was crucial. Many people catch a wave when starting a business. For example, now everyone wants to start an AI company because that's the so-called 'hot project.' It's easier to start a business when the external environment keeps giving you positive feedback. But ultimately, whether a company succeeds almost always depends on a core belief of the founders or early team—they feel that this thing must be created.

So, founding a company at our time was, in a way, a good thing. Because whether we should stick to this belief, whether we can forcefully bring it into reality, was tested very early on. We've always had a very core belief: stablecoins represent a superior way to build financial products. The reason is not ideological but because it truly enables faster, cheaper, and more accessible fund transfers. Essentially, it's a more efficient way of moving funds.

Here's a very typical example: Many people may not have thought about it, but when you transfer money through ACH or wire transfer, you don't actually get any confirmation, so you have no way of knowing whether the money has arrived. You just send it out and hope it gets there.

Ryan: Zach, have you ever experienced a lost wire transfer? I have. It was actually quite recent. I sent a wire transfer from one place to another. I'm still involved in some traditional financial activities, and I have a bank account, so I'm not completely "unbanked." Just to clarify that.

Zach: Wire transfers often run into issues, yes.

Ryan: Yes, that wire transfer didn't go through at all. I waited for 24 hours, 48 hours, and the money simply didn't show up. I was in a complete panic. Then I started investigating: Has this wire transfer settled? Where is its ID on the FedWire? I spoke with at least five or six people. And this was just a transfer between my brokerage account and another account.

Later, they escalated the issue to the wire transfer tracing team and told me it would take 48 to 72 hours to process. I asked if these situations are usually resolved, and they said most of the time, but there are no guarantees. I was thinking at that moment: if you can't even trace a wire transfer, it's just outrageous.

Zach: Right, it's truly absurd. When you send a stablecoin via blockchain, you can see when it was sent, when it was confirmed, when it was received, and even if it didn't arrive, you would know immediately. These are all basic functions.

Aside from costs, there are more complex factors that make us firmly believe that the future of money will definitely be tokenized. Whether it's individuals, businesses, fintech companies, or banks, they will all eventually see the value of this new payment rail. And we are preparing for that future. We have always held this core belief.

And my fintech background actually helped a lot. I've seen too many cases like this: the reasons behind successful fintech products are actually very straightforward. It's not like the consumer internet sector, where you have to guess why Instagram won, why Facebook won.

The logic of fintech is more direct. Why can Robinhood win? Because it offers commission-free trading, while other platforms charge $5 per trade. Why can Square succeed? Because before its arrival, small businesses had to spend thousands of dollars a year and pay a 5% fee to process credit card transactions, and Square made it instant and cheap. Stripe follows a similar logic.

Every financial product ultimately follows a pattern: over time, people will make rational choices. So initially, the market stigmatizes stablecoins and perceives them as risky. However, at the same time, building and using stablecoins can bring very tangible benefits. What we are doing is moving towards a future where the perceived risk decreases, and people can truly experience these tangible benefits.

Initially, these users are often the most risk-tolerant, such as early-stage companies. But now, as regulations become clearer, users with a lower risk appetite—including large enterprises and even governments—are also starting to use stablecoins. This is particularly exciting. But all of this stems from our initial core belief: stablecoins are sound in financial logic and worth building.

Ryan: Yes, that's the core belief you upheld in 2022. At that time, it was neither obvious nor popular. After the Terra Luna crash, many people thought stablecoins were "dead" and couldn't continue in crypto. Coupled with situations like Tether, everyone questioned how AML, KYC was handled? Is it somewhat gray? What exactly happened?

So I think that's what you call your "unshakable assertion." Zach, I would even say you are the closest person I've seen to a "stablecoin maxi." You know, there are various "denominations" in the crypto space. But you might be the representative of stablecoins. Because I've heard you say that even though you are skeptical of many of the values ​​promoted in crypto, once it comes to stablecoins, you believe they are the "next evolution of money."

I remember you said something like this: "I started a business in the crypto space not because I want to liberate the world from centralization, not because I want to build a libertarian utopia, but because I love financial services, and I believe this new platform can be used to create better products."

Some crypto-native Bankless listeners might think, "Hey, Zach, you sound too pragmatic. That's not what we're here for." But you are straightforward; you believe that the most significant value proposition in crypto is to build a better fintech system based on stablecoins.

So for those who are not familiar, when they hear about stablecoins, they will think of Circle or Tether and see stablecoins as those issuers. But what you are doing is actually different. Although I know Bridge also has a stablecoin, fundamentally, it is more like a stablecoin payment platform. What did you build between 2022 and the acquisition? And what is Bridge's mission?

Zach: I think one of the greatest insights I've gained from my experience working at Square, then at Brex, and now at Stripe, is how incredibly impactful money is in people's lives. Even if it's just a slight improvement in helping people with payments, fund management, or transfers, I can clearly see the immense difference it makes in people's lives.

Take Square, for example. They created a small card reader that made it easier for small merchants to accept credit card payments. Before that, many could only accept cash. But Square enabled millions of merchants to sell more goods, turn unprofitable businesses profitable, and capture transactions they would have otherwise lost. This change fundamentally transformed many people's livelihoods.

Stablecoins operate in a similar way, but their impact can be much larger.

You see, the significance of stablecoins lies in their ability to be used and stored by people worldwide. With stablecoins, individuals in every country now have a real choice that didn't exist before. You can use stablecoins to transfer value between different countries at a fraction of the cost. This opens up tremendous opportunities, and the applications people can build based on it will be far-reaching.

So, we always hold on to this long-term belief. I, in particular, am deeply driven by this belief in the potential and ultimate outcome of stablecoins. Of course, there are moments of doubt as well. One particularly memorable instance was when we launched the API, coincidentally during the week Silicon Valley Bank (SVB) collapsed. I remember saying to Sean, "I still believe we are on the right path, but maybe this road is delayed by ten years, and the timeline could be completely off track."

Ryan: And you wouldn't have imagined that when you thought you were at rock bottom, all it would take was another 24 months, and the U.S. would pass its first crypto legislation, specifically focusing on stablecoins. This meant that overnight stablecoins gained legitimacy and experienced explosive growth. At the time, you thought the future was delayed by ten years, but in reality, the turning point was only two years away.

Zach: Unbelievable, indeed. Going through those initial setbacks made us extremely cautious. What we were most concerned about back then was "how to ensure the next meal," because the first 18 months of the company were almost a continuous cycle: finally signing a bank partner, only for them to quickly go under; signing a customer, only for them to have issues just as rapidly. Even when things eventually started to improve, we would still think, "Wait, this surely can't last for long, right?"

Ryan: When did things start to take a turn for the better? Closer to 2024?

Zach: So, about the turnaround? I would say it's around June 2023.

We founded the company in early 2022, so it was about 18 months later that things started to improve. Going back to your earlier question: What Bridge does is facilitate liquidity using a stablecoin. Our view is that the current fiat system already exists, and stablecoins are like an "extension layer" built on top of the fiat system. You can understand our mental model as: Stablecoins are like a Layer 2 on top of the fiat system, which is Layer 1. Funds need to first be "on-chain" in tokenized form to enjoy more efficient benefits, but they will ultimately keep "falling back" to Layer 1.

A very typical example is cross-border payments: Funds initially come from fiat because the business itself operates in fiat; then the funds will ascend to this extension layer, becoming tokenized; after cross-border movement, they will fall back to the recipient, returning to fiat.

Ryan: So in this example, Layer 1—the fiat layer, refers to bank settlements? Will it eventually settle into systems like FedWire?

Zach: Exactly. Today, most fund flows switch back and forth between Layer 2 and Layer 1. This is also the operation mode of many practical use cases. A good example is: Bridge allows people from around the world to store money as dollars, but in the form of a stablecoin.

For example, our partner Scale AI, which provides data labeling for AI models. Scale's business settles in dollars—fiat dollars. They send the funds to Bridge, Bridge converts these funds into stablecoins, and then distributes the stablecoins to data labelers worldwide.

So initially the funds are on the fiat layer, we tokenize this money, and then distribute it to users, allowing them to benefit from the advantages of stablecoins.

Ryan: So the essence of Bridge is actually to build a bridge between Layer 1, which is the fiat world (traditional banking system, eventually settling into FedWire, etc.), and Layer 2, which is the tokenized stablecoin world. You are right in the middle. And the API you mentioned is the interface connecting the banking layer and tokenized stablecoins, right?

Zach: Exactly, that's right. And we are basically built for developers. Today's developers are mostly fintech companies, banks, or startups. They want to use stablecoins for cross-border fund transfers, or accept stablecoin payments, or allow customers to store tokenized dollars, or even issue bank cards based on stablecoins.

Through a set of very simple APIs, we package all these capabilities, allowing developers to not have to delve into the various details of the crypto world and fiat world, and not have to grapple with complexities such as KYC and compliance. They only need to make API calls to deliver the final value to their users.

Ryan: So do you have your own stablecoin as well? Similar to USDC?

Zach: Yes, we have a stablecoin. Going back to your previous question: June 2023 was when we really got things running, and our first core product is the so-called Orchestration APIs. Its function is to enable fund movement between the fiat layer and the stablecoin layer. The earliest scenario that was up and running was using stablecoin for cross-border payments.

Our very first real customer was Zulu. They were our first "real customer." The situation at that time was quite interesting: I tweeted, they saw it, and reached out to us. However, the negotiation process with them was extremely tough, they squeezed us hard on fees. I almost wanted to give up a hundred times because I had never sold anything before. Eventually, they onboarded the platform.

Their need was to convert Colombian pesos to stablecoin, have someone help them convert the stablecoin to USD, and then transfer the money to a US bank account. In other words, they needed a service that could run a cross-border payment flow converting Colombian pesos to USD.

We created a very simple product for them: assigned a crypto address to their bank account. For example, all they needed to do was send the stablecoin to a specific Ethereum or Solana address, and this address would automatically convert it to fiat, sending it to the associated bank account via ACH or wire transfer. For them, the product was very simple: just make an API call, create an account, deposit the money, and the system would deposit it into their bank account.

After signing with Zulu, they grew at a rate of 50% to 100% every month. As a result, Bridge also grew at the same rate. The status of a startup is quite strange: from one perspective, our company at that time was probably super fragile, almost having only one customer, not a true product-market fit. Although there were a few other customers, the core relied on this one. However, from another perspective, we could say that we truly got things running because the company was growing exponentially every month. Zulu carried us through the first three to four months.

I often think, what would have happened if we didn't find Zulu back then? Today, everyone looks at Bridge and sees it as successful: we are now part of Stripe, stablecoins have become a trend, as if everything was destined to succeed. But at that time, the difference between us and "no progress, zero customers, zero feedback" was just one customer. It's incredible. It was this one customer that gave us the confidence to try the next customers. As a result, our next big customer turned out to be the US government.

There was a government aid project at the time to distribute funds to frontline workers in the Latin American region. This aid was previously distributed through a stablecoin, executed by Silvergate. But when Silvergate went bankrupt, they could no longer distribute the funds because the process was actually very complex. You needed to first receive the funds from the government, convert them into stablecoin, and then send out thousands of stablecoin payments. This was completely impossible to be done manually.

Ryan: Essentially, it's still dollar payments, right? As I hear you tell this story, I'm reminded of the previous U.S. 'stimmy checks.' Remember those? Every American received them, but the process was very strange and clumsy. I received mine via ACH, some people got paper checks; if you didn't have a bank account, you might not have received it at all.

Stablecoins are actually a similar thing, just on a smaller scale: you just want to airdrop funds quickly to a specific group of people or organizations. But in the existing fiat Layer 1 system, this is almost impossible—because the whole process is too cumbersome.

Zach: And the cost is extremely high. You have to take this 'U.S. format' fund of dollars, through a U.S. partner, and convert it to the local currency format, such as the Argentine peso, Brazilian real, which costs money. Then deposit it into a local bank account, which costs more money. Each step has fixed costs and variable costs. For small amounts of funds, there is almost no way to efficiently distribute them. It is for this reason that before finding us, they chose to use stablecoin for distribution.

Ryan: Let me ask you a more macro question. If we consider Layer 1 as the settlement layer for banks and fiat, and Layer 2 as the layer for tokenized stablecoins, combining the native encryption platform, what do you think?

If more and more business starts to happen on Layer 2 because it's more user-friendly and functional, then global fintech applications—whether in emerging markets or in the U.S.—are more likely to directly use Layer 2 rather than rely on Layer 1.

This way, I see the result as: the existing bank settlement system will to some extent be bypassed. At least, more and more real-world scenarios are happening on Layer 2, and the banking system gradually regresses into a 'dumb settlement layer.' They no longer do those interesting, valuable things, no longer build applications, but are marginalized, only remaining in settlement.

So I was thinking, if the trend is really like this, will there be conflicts with the existing traditional banking system—such as institutions like JPMorgan Chase? I recently saw Jamie Dimon say something similar. He mentioned Plaid, and you should be familiar with this tool. Plaid connects to the global banking system through APIs, allowing developers to easily access bank data.

Jamie Dimon said, we don't want Plaid to scrape our customer data anymore, even if the customer authorizes it themselves. They want to restrict Plaid and even charge additional fees. His meaning was clear: they don't want to be downgraded to that "zero-profit dumb utility layer."

So I'm curious, as more and more businesses move toward Layer 2 stacking, leaning more towards crypto and fintech, will banks tolerate it? Or will they fight back? Have you seen this trend happening now?

Zach: I think they will. I think some banks will definitely do that. Assuming we completely remove regulatory factors and the world becomes a "lawless libertarian paradise," the flow of funds will definitely increasingly be done through stablecoins. In other words, if you consider the stablecoin layer as a layer above the banking layer, then over time, more deposits will settle in the stablecoin layer, and more users will interact only through the stablecoin layer. And the banking layer—although it is still massive today and is the main channel for fund flows—its future scale will gradually shrink over time, while the stablecoin layer will continue to expand.

I think this is a natural evolution. The reason is actually very practical: building applications on the stablecoin layer will be easier; whether as a consumer or a business, you can get better economic benefits on this layer; the cost of fund flows is lower, and settlements are simpler. Therefore, more and more transactions will naturally move here.

However, I think the real big issue is: all fund flows, all financial services, fundamentally need to comply with regulatory requirements.

So the question is: how much funds and businesses will move to this layer? And obviously, banks will do everything they can to protect their scale and importance.

Ryan: Let me give you an example. One area that banks seem very keen to protect is government bond yields, especially short-term government bonds. According to the Genius Act, there is a specific provision: stablecoin issuers cannot directly return this around 4% yield to users; only banks can do this. Of course, I'm simplifying, and you definitely understand the complexity of it. But the basic logic is: only banks can directly give customers government bond yields.

However, the crypto community later found a small "workaround." Instead of a issuer like Circle directly giving the 4% yield to users, it is done by exchanges. For example, I currently hold USDC in Coinbase, and although I don't receive the full 4% (Coinbase takes a cut), I do receive some of the yield. You can imagine that in crypto and DeFi, there are various ways for stablecoin holders to receive this portion of the yield.

The question is: why not? Why can banks exclusively enjoy this 4% yield? Why can't stablecoin holders benefit? Why should this 4% "rental yield" be monopolized by banks? Now, the banking consortium is trying to plug this loophole; they don't want crypto companies to continue exploiting this yield.

Thus, a confrontation has emerged: on one side, crypto and fintech, and on the other, the banks. Clearly, the banks are powerful; they have deep roots in Washington and have a grasp on part of the rules of the game. This seems to be brewing into a "battle of giants." How do you see it?

Zach: Indeed. But I also want to add that this isn't entirely "crypto against the banks." For example, Tether did not return the yield to users, nor did Circle.

Ryan: Right, they also didn't have the incentive to return that portion of the yield.

Zach: That's right. This is also a question I often ponder. Before founding Bridge, I often thought that some reasonable things would inevitably happen. For example, as you mentioned earlier, returning the yield to users seemed, in my eyes, an inevitable event because it was so logical.

But now I realize more clearly that there really isn't anything that is "bound to happen." Only when someone—whether a few individuals or a large team—works hard to drive it forward, will it truly happen. For example, the matter of "returning the yield to users" will only change the market landscape when someone builds the appropriate mechanism and continues to drive it forward.

Even if stablecoins eventually succeed, if only USDT and USDC, the two major mainstream stablecoins, exist, the result is apparent: Tether will never return the yield to users; it's not their model. Circle and Coinbase may also stop at some point in the future. That surplus won't flow to consumers or businesses; instead, it will be seized by new "Visa/Mastercard-style" giants.

So someone needs to build a new mechanism. This is why we are issuing our own stablecoin — to ensure the benefits of a stablecoin, the economic value generated by the stablecoin, can better reach end users and end enterprises, thereby improving the platform's economic model.

We believe this is very important. This is not just a regulatory game but a game about the long-term stablecoin market structure. We must ensure that this system ultimately creates surplus for consumers, rather than just transferring value from old financial institutions to new ones.

Ryan: Right. As an ordinary stablecoin holder, of course, I hope these "rental returns" will disappear and more returns will go back to users. So let's talk about the Genius Act itself.

Currently, stablecoins in the cryptocurrency field are almost a "duopoly." Tether holds the dominant share, followed by USDC. This situation is in line with the logic that "the greater the liquidity, the more advantage", and it seems to reflect the "power law effect." However, the current size of the entire market is only around 270 billion dollars, and it will definitely grow to tens of trillions in the future.

Genius Act has opened up a whole new door, allowing various new issuers to enter the market. Some fintech players have already entered the game, such as PayPal's stablecoin; you have your stablecoin; I bet Stripe will definitely make a big move; there are even rumors that Amazon, Walmart may also join.

Therefore, after the Genius Act, we may enter a new era where various issuers flood in, various experiments unfold, everyone is vying for liquidity, competing for dominance, and they will take different paths and strategies.

You. What is your view of the stablecoin market after the Genius Act? You can start by talking about Stripe's strategy, but more generally, do you think there will be a lot of experimental projects, or will there be some clear structure?

Zach: Our view is that there will be many different stablecoins in the future. I think every platform should have its stablecoin. We may see a world where the number of stablecoins reaches tens of thousands, even millions.

The differences between these stablecoins will be fully abstracted. So, in the end, only a few "branded stablecoins" will be truly recognizable, such as USDT, USDC. I believe USDT and USDC will be even more successful in the future than they are today, and we certainly hope so because they play a huge driving role in the industry. Their businesses have strong network effects, such as continuously accumulating liquidity and building forex pairs.

These are all very difficult to replicate. PayPal is an example—they spent a lot of money to kickstart PYUSD and establish liquidity, but the results were not easy to achieve.

Therefore, I think perhaps only about five or so, or a handful of such "branded stablecoins" will truly establish themselves in the market. Meanwhile, when major platforms use stablecoins—such as Robinhood, the Amazon you mentioned, Walmart, or even banks—they are more likely to issue their own controlled stablecoins. The reason is simple: these stablecoins are primarily used for internal fund transfers within the platform, such as distributing funds to users or settling between different subsidiaries. In this scenario, the external liquidity advantages of USDC are simply not relevant.

For example, Walmart reallocates funds among more than twenty subsidiaries in Europe, which is entirely internal transfers. Naturally, they want to use their own stablecoin because they want direct control of reserves, rather than handing funds over to Circle to mingle with others' funds. They also want to directly earn interest income and have full control over the flow of these dollars.

More importantly, some issuers are now charging a burn fee during fund redemptions. Just think, if you have to pay an additional fee to withdraw a large sum of money, it's even worse than using fiat.

So you definitely would want to control your own funds. This is not about decentralization but about not wanting to rely on another platform because its interests will always override yours. This is especially true when fund movement itself is a core part of your business.

Ryan: I see, very interesting. Let me confirm if I understand correctly: the future world you describe will probably be like this—there will be a handful of "external branded stablecoins," similar to today's Tether, USDC. They each have their own positioning, with Tether being more favored by international markets outside the U.S., while USDC is the representative of "compliant stablecoins." In the future, there may be a stablecoin that focuses on "returning profits to users," or other features, but in any case, the number of external stablecoins will only be a few.

Meanwhile, every major company will have its own "internal stablecoin." I even think of the Starbucks reward card now, although it is not yet an ERC-20 interchangeable token, it is actually an internal currency that exists on Starbucks' balance sheet. The world you mentioned might be this: there are only a few external stablecoins, but companies internally will have thousands, even millions, or even tens of millions of different "corporate stablecoins."

However, I can imagine that ultimately they must be compatible with each other. Just as I wouldn't want to have Wells Fargo dollars in my hand but not be able to use them at JP Morgan because JP Morgan only recognizes its own JP Morgan dollars, and then I would have to exchange them again. This whole system must maintain substitutability and interoperability just like today. Is the world you envision really like this? Can you help me understand a bit?

Zach: Yes, exactly right. Let me give you two simple examples. Imagine in the future every bank settles funds using a stablecoin, but Wells Fargo will never use JP Morgan's stablecoin; this is absolutely impossible. This is because the reserves for JP Morgan's stablecoin exist with JP Morgan. If Wells Fargo were to use it, it would mean that its reserves would have to be held with JP Morgan. Logically, this makes no sense at all, so this scenario will never happen.

Let's give another example. Suppose you are Polymarket. Polymarket mainly operates with stablecoins now, allowing users to bet with any stablecoin they want: you can use USDT, USDC, in the future, possibly even directly with the dollar, or other tokens.

But within Polymarket, you would certainly want it to eventually operate on its own PolyUSD, or some kind of internal stablecoin belonging to Polymarket. There are several reasons for this:

First, if Polymarket were to build its own Layer 2 in the future, its stablecoin could seamlessly migrate to that Layer 2 without needing to persuade an external issuer to cooperate with the migration.

Second, it wants to ensure that there is no burn fee during redemption, so it can achieve zero-cost redeemability at any time.

Third, it might eventually want to be able to program and customize the smart contract logic for these dollar stablecoins.

Therefore, for Polymarket, controlling its own "dollar" — a programmable and tokenized dollar it has built — is key to ensuring it can lead future development.

Ryan: And if it's Polymarket, it might also want to distribute interest income to users, right?

Zach: Yes, exactly. So we believe that such a world should exist. But the issue is that someone must build this world. Genius Act is a very important first step, making this world more feasible and increasing market acceptance. Next, we need to actually implement it.

Ryan: Now, going back to your earlier example of Wells Fargo and JPMorgan. If Wells Fargo needs to transfer money to JPMorgan, how would they do it? Do they need to go through a specific intermediary stablecoin, such as USDC, before transferring to JPMorgan? Or would they revert back to Layer 1, the fiat system, to settle the transaction in the background?

Zach: The way I envision it is that there would be a dedicated stablecoin clearinghouse. Each day, stablecoins between banks would circulate within this clearinghouse, and then at the end of each day, they would truly settle on Layer 1 for the net settlement, rebalancing each party's reserves. This way, only one net settlement would be required each day, rather than full-fund settlement. This logic is actually somewhat similar to the settlement logic in the current financial system, just with a different settlement window. But I believe this is how it will operate in the future.

Ryan: Stripe's actions are very interesting. It seems like we are now in an era where fintech companies are undergoing a comprehensive "crypto transformation," and Stripe has already signed up to be one of the pioneers in this transformation.

I've been following the Carlson brothers, who have previously explored some crypto directions, such as Bitcoin and the Lightning Network, but were more skeptical at the time. This time is different; this is the first time we've seen Stripe truly go "all in" on crypto. Starting from the acquisition of Bridge (a stablecoin payment infrastructure) and then acquiring Privy (a crypto wallet infrastructure company), their strategy is significant.

So this is not just Stripe's story, but also a microcosm of the entire fintech industry accelerating its crypto transformation. You were an early visionary of stablecoins, and now it's been five years since then. If we look ahead another five years, after this phase of convergence, what will fintech look like? For example, Venmo, which many American users use every day, could it become a crypto wallet? Will the balances in our PayPal accounts then be entirely in stablecoins? How do you think this convergence will shape the fintech industry?

Zach: I believe most financial assets will be tokenized. The result will be that the foundational module of every fintech company will be a "wallet."

In the future, it won't be like today, where people see the crypto world as a new field that needs to be relearned. At that time, you would only need to call an API, like Bridge's API, to open an account for a user, which is essentially a wallet. In this wallet, you can enable the dollar (in the form of a stablecoin), enable the euro (another stablecoin), enable the real (yet another stablecoin), and going forward, you can also enable stock trading (which is the tokenized form of stocks), and so on.

I believe we are currently on a "glide path," unless there is a dramatic regulatory change in the future. The most interesting dynamic here is that on one hand, you will see wallets that originated from the crypto space gradually moving towards traditional financial services; on the other hand, you will also see traditional financial companies continuously moving towards crypto. Over time, these two paths will gradually converge.

Take Robinhood, for example. It was initially a typical player in traditional finance, starting with stock trading. However, it later increased its investment in crypto trading, and now one of their key strategies is internationalization. So, as a fintech company, how do you expand internationally? If I were Robinhood, I would choose to start with "building a wallet" and make the wallet the core.

The most magical aspect of blockchain is that it is essentially "open-source financial services." For example, when you build on Solana or another blockchain, any developer worldwide adding new features to Solana can immediately be used by Robinhood.

Ryan: And it is always open, 24/7. As long as there is an internet connection, it can be used in any country.

Zach: Right. The traditional financial service model is that as a company, you have to build everything yourself. If someone wants to replicate Revolut, they have to establish their compliance infrastructure, develop new products, access local stock markets—in every new country.

But blockchain is completely different. For instance, if someone issues a tokenized Brazilian Real on Solana, Robinhood does not need to develop related infrastructure themselves; they can immediately support BRL deposits natively. Similarly, if someone issues a Euro token on the chain, Robinhood can directly support Euro balances; if someone issues tokenized government bonds, Robinhood can directly provide government bond yields.

Therefore, you are essentially "open-sourcing" the entire financial stack to the world, built collaboratively by countless developers, and then you internalize these services into your product. This is why I believe everything will be on-chain in the future—it shifts from the old world of "a single company building bit by bit based on its capabilities" to a world where "everything is shared and built on the blockchain," and you just need to integrate and internalize these outcomes.

Ryan: This is actually a very simple narrative, but now, it is really happening. Like you said, all the bank accounts we currently use will become crypto wallets in the future, whether users know it or not; and all the assets we hold will also become some kind of crypto token, existing somewhere on the chain.

Another issue is that we have seen some fintech companies, such as Robinhood, and even Coinbase (which now also seems to be transitioning more towards fintech), launch their own ledgers — each with their own Layer 2. Meanwhile, companies like Circle recently launched a Layer 1, which can be seen as a public chain focused on stablecoin payments. There have also been recent reports that Stripe is following this path, announcing the Tempo project.

So the question is: how does this fit into the entire stack? Will banks also move towards a similar model — gradually transforming their originally backend "private ledgers" into some kind of semi-private/semi-public chain-based ledger? Will they also introduce their own Layer 1 or Layer 2 in the future? How do you see this evolution?

Zach: For us, this process has actually evolved quite naturally. I would say Bridge may have been one of the earliest companies to attempt to build payment-level infrastructure on the blockchain. I dare not say we were definitely the first, but at the time, it did feel like we were at the forefront. And this matter is very difficult, and still very difficult to this day. Blockchain has many advantages, but it does not perform well in terms of "payment scalability."

Ryan: For example, building on Ethereum would encounter issues like gas fees, right?

Zach: Even on Solana — a project recognized by many as a TPS (transactions per second) leader. We recently had a client who had millions of accounts and wanted to enable stablecoin accounts for all users. To achieve this, you have to generate a Solana wallet for each user and pre-fund it to receive USDC. Both of these steps require SOL (Solana's native token), and each wallet costs about 0.3 USD equivalent in SOL. So, just to enable this feature, the cost could reach tens of thousands or even millions of dollars.

The reason is simple: Solana's design was never intended to deal with this scenario of "suddenly needing to enable millions of accounts." In reality, almost no one would be willing to spend millions of dollars to enable a feature that a user has not even started using or testing.

Another example involves disaster relief fund distribution. In the traditional fiat system, fund movement is extremely slow — so slow that we have to layer a lot of infrastructure on top to ensure funds do not move freely. In a scenario where you need to distribute money to tens of thousands of people at the same time, the usual practice is to use PayPal, pre-load the money to PayPal three days in advance, wait for the funds to confirm, and then hit the button to send. But that is not actual money moving, it's just a digital update on the ledger.

But that's not how blockchain works. Each person has an independent wallet, and you have to actually send the money to each wallet individually. Trying to simultaneously send 20,000, 30,000, or even 50,000 transactions on-chain is impossible—no matter which chain you're on.

The first time we did aid distribution on Stellar, we were particularly naive. We clicked the "Send" button, thinking we could get it all done at once. But processing these transactions took 18 hours, with a high failure rate. Soon after, we received a flood of support requests: "Didn't you say the funds would arrive by 9 a.m.? Why haven't they arrived yet?"

So we had to build a whole infrastructure to optimize, such as prioritizing high-value transactions over $50, as these users were more likely to check immediately, and then setting up seven to eight parallel batch distribution tasks to gradually move forward. Because there was no way to deliver all transactions at once.

In short, blockchain does struggle with payment scalability. So our approach was to build infrastructure that could address its own pain points. We weren't doing transaction-related things from the beginning, and we're not doing them now. Instead, we simply want a system with high throughput, core functionalities needed by a payment company, and the ability to ensure delivery reliability. Because if someone wants to run banking operations on this track, pay salaries, or make payments to all customers, deliverability is essential. Therefore, building and investing in Tempo has become particularly important for us.

But I want to emphasize that Tempo is not a "Stripe-exclusive blockchain." We also don't believe that so-called "enterprise private chains" will succeed because no one wants to build on someone else's chain; they want a shared, widely recognized infrastructure. This is similar to our skepticism about "building on someone else's stablecoin"; you wouldn't want your interests to be subservient to another company with its own economic considerations.

Therefore, Tempo is actually an independent entity. Stripe is one of Tempo's main contributors, Bridge is also a core participant and collaborator of Tempo, but Tempo itself is a neutral blockchain built outside of Stripe.

Ryan: So Tempo will be an independent entity, a neutral blockchain, and based on EVM Layer 1?

Zach: Yes, Tempo is indeed an EVM Layer 1, focusing on high TPS without the "neighbor noise" issue. We won't encounter transaction jams due to the listing of a "Trump Coin"—we've experienced this on Solana. It will also support private transactions, which are crucial for all payment companies. Additionally, it will provide extremely fast finality; unlike Ethereum, where you have to wait 12 minutes for confirmation, on Tempo, it is sub-second finality. These features are critical for payment scenarios.

Ryan: So you can achieve such a use case: for example, in the US, to send a stimulus check to one million people, you can do it directly on this chain. Users just need to use any EVM-compatible wallet to receive the payment immediately. In other words, its scale is large enough to support this operation, right?

Zach: Exactly. And the key is, not only can we use it, but if PayPal sees value in it, they can also use Tempo to achieve it. That is our positioning: we see Tempo as a crucial public infrastructure for the entire stablecoin ecosystem. Stripe is one of the main contributors, and we are also investing in and building Tempo. However, like any other participant, we have the same rights and voice, without any special privileges.

Ryan: So, Zach, how do you think this trend will evolve? Especially in terms of Layer 1—financial technology companies like Stripe entering the Layer 1 space, and we see Circle launching its own Layer 1.

In the crypto space, the emergence of more centralized stablecoins has not weakened the status of native crypto assets (such as Bitcoin, Ethereum), but has actually accelerated their development. They have grown in parallel with stablecoins, never falling back to what you call the "fiat Layer 1," but have formed an independent settlement network.

How do you view the development of Layer 1? Specifically, for projects like Tempo—I know you said it's not Stripe's exclusive chain, but similar Layer 1 projects like Tempo. Will they erode the market share of Ethereum, Layer 2, Solana, and other public chains? Or will they be complementary? How will they interact? Do you think the future evolution will be: every fintech company, every bank issuing their own Layer 1 or Layer 2? Or will there be a "power law distribution" of winners? How will the landscape of the ledger layer evolve?

Zach: I believe projects like Tempo are highly complementary. Tempo exists because the functionality it provides is currently not available in the market. If there were nothing like Tempo, the entire stablecoin ecosystem would be much smaller. Because there is currently no chain that can support "payment scale operations", the connections are not even close."

So in this sense, I believe Tempo is a complement to all existing blockchains rather than a replacement. My view is this: in the future, there will be a few "general-purpose blockchains" that will continue to exist. For example, Base, which will clearly emerge as a winner, given the excellent product experience built by Coinbase; and Solana, as another example. There will be a few such general-purpose chains in the future. However, if someone now wants to create another "general-purpose blockchain" out of thin air, hoping to attract a large volume of transactions, I think the difficulty is very high.

We are entering a new stage: everyone will build chains specifically designed for a certain type of need to solve problems that general public blockchains cannot solve. Tempo is aimed at the payment scenario; I have also talked to some teams who are building chains for the transaction scenario, such as meeting the demands of ultra-high throughput and low-latency transactions, which require completely different technical requirements. These types of blockchains will solve some highly specialized problems that general-purpose public blockchains cannot solve.

I believe a third type of blockchain will also emerge. For example, going back to the Polymarket example, Polymarket may choose to build its own chain to control its block space. These are application-specific chains. So the overall landscape may be like this: a few general-purpose blockchains; a few function/feature-oriented blockchains, such as Tempo that we are working on; along with a large number of application-specific chains. This is my current mindset, but of course, it may change in the future.

Ryan: So we will see a bunch of blockchains emerging, meaning a lot of businesses will be on-chain. So, five years from now, where will fintech, or more broadly the financial system, be—whether in the US or globally?

If we look at the underlying layers, the current traditional financial and banking systems are actually settlement layers. As far as I know, they are still running some old systems like IBM mainframes and systems coded in COBOL, the underlying systems are very chaotic, and full of paper documents. Although on the surface, they appear digital, the financial operations behind it may still involve a bunch of office workers dealing with paper documents. Maybe they are no longer using fax machines, but legal documents are still on paper, which makes it hard for me to believe.

Zach: Yes, they might actually still be using fax machines.

Ryan: Yes, so can we understand that we are gradually transitioning away from this old legacy system, slowly moving to the new encrypted/blockchain system? In other words, in the future, the user interface of fintech will no longer rely on the traditional financial backend mainframe systems, but will increasingly settle directly on the blockchain.

Zach: Yeah, I think that's the way forward. Take Bridge, for example. Our business originally started with a product that involved Stablecoin Bridging: moving funds frequently between fiat and stablecoins, and between different Layer 1 and Layer 2 solutions. At the time, this was a rigid need, and it remains so today.

I believe our business will increasingly move towards a specialized service, which is actually the outcome I hope to see. Because that means the demand for settlement on Layer 1 will diminish. Just like the banking example I mentioned earlier: in the future, there might be millions of stablecoin transactions behind every fiat settlement. Whereas today, it's almost a one-to-one ratio, or even two fiat settlements for every stablecoin settlement. I hope to see that ratio shift.

In my view, this is the hallmark of success: more financial services can be directly completed and settled on the blockchain layer. But the reality is that we are still in a very early stage. For example, in the most basic scenario: sending a large batch of transactions simultaneously is still very challenging at the stablecoin level.

Furthermore, there are hardly any local currency stablecoins at the moment. The entire market is 99.9% dominated by US dollar stablecoins. While this is great for the first use case of stablecoins (facilitating transactions and accessing USD liquidity), if stablecoins are to truly become a core part of the financial system, local currency stablecoins are essential. I am very optimistic that they will become crucial in the next 5 to 10 years. But today, these foundational components are still missing.

Ryan: The US Treasury Secretary recently cited some research stating that by 2028, the scale of on-chain stablecoins will reach $30 trillion. Do you agree with this assessment? How fast do you think the growth will be, and how large will the scale be?

Zach: I believe that prediction only refers to US dollar stablecoins. If we can successfully tokenize the Euro, Peso, Yen, and others, the scale could easily be an order of magnitude higher. Of course, this depends entirely on the regulatory environment. One good news right now is that the US has rapidly transformed from a regulatory laggard to a regulatory leader, allowing us to drive the market faster. But we need to see the same progress globally.

Ryan: So, what is the biggest obstacle hindering the entire world and the entire financial system from transitioning to a crypto-based system more quickly? You mentioned regulation earlier, I suppose that might be one of the top three obstacles. But apart from that, there are issues with user experience. For example, wallets—often still requiring mnemonic phrases, which can be quite a barrier to entry.

For example, do you have features like chargeback protection or consumer protection similar to Visa or traditional credit card networks? On the compliance and privacy front, do you have the Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements of various countries? What do you think are the three key missing pieces to scale cryptocurrency assets to trillions of dollars and truly go mainstream?

Zach: The most straightforward answer is regulatory clarity and accounting standards clarity, which may be the most obvious. But for us, a more specific barrier is actually education.

One of the biggest challenges in stablecoin development is this: over the past few decades, teams have accumulated rich experience and momentum in the fiat currency system. In any company involved in financial transactions, there is a large group of people who know how to set up For Benefit Of (FBO) accounts, how to construct internal ledgers, and even how to send ACH batch files—through years of practice, they have mastered these complex operations.

However, when you walk in and talk to them about "enabling an on-chain wallet," the situation is completely different. Everyone's mind is blown, as if you are asking them to go to Mars. This is a whole new financial technology stack, completely unfamiliar. And it touches on the "lifeline" of every company—financial transactions. This naturally makes people very risk-averse.

I would say that if every company had someone who is very familiar with crypto, our progress today might be 100 times faster.

Another issue is the extremely limited number of engineers who understand crypto. People who truly understand smart contracts, have experience in wallet development, are probably one of the smallest engineer communities globally. In other words, if you are an engineer and want to find a track that can give you the "rarest skill," the answer is almost obvious: it's crypto. This will become an extremely important field for the world, involving the flow of funds in every company, on every continent. But now, there are probably only a few hundred people who really understand this system.

Ryan: Stripe itself has many engineers, and you are now also part of a larger engineering team. What about Patrick and John? We've talked before about their early attempts in crypto and their gradual shift towards a more optimistic attitude. How do you think their acceptance of crypto is now? How "crypto-pilled" is Stripe as a whole?

Zach: During the acquisition process, I went to the Stripe office once for lunch with John and Patrick. I remember that it was probably the first time I met John. As soon as I walked in, he said, "Can I tell you a joke?" I said sure. He said, "Do you know the difference between a bank and Tether?"

I said I don't know.

He said, "The difference is—one of them is a massive institution holding a huge amount of funds, but you have no idea where that money is. And if you want to withdraw it, you probably can't because it's been invested in a pile of extremely complex and opaque assets with no transparency. While the other is different."

Ryan: Well, that makes sense too.

Zach: Yeah. So I think at a deeper level, they are actually strong stablecoin believers, and they also understand the potential of this technology. For example, they were early investors in Stellar. They also tried Bitcoin, but quickly realized Bitcoin has many issues in terms of payments and is not suitable for large-scale adoption. It wasn't until they saw the gradual rise of stablecoins, combined with the specific use cases addressed by Bridge, that some puzzle pieces truly came together.

Ryan: Stripe is a massive company with numerous partnerships. What are your expectations for crypto penetration within Stripe? How do you envision this fintech company transitioning to 'crypto fintech'?

Zach: The most exciting thing for me is that no one will simply use stablecoins just for the sake of using stablecoins. People are willing to use stablecoins, wallets, and our API because they provide clear business value: such as helping businesses enter new markets, serve more users, reduce costs, or create new revenue streams. There must be tangible benefits for the application to truly take off.

And now, being part of Stripe, the biggest advantage is that the feedback loop is significantly shortened. Previously, we needed to validate product value ourselves, but now Stripe itself is our first and best customer. All our new features can be applied and tested internally at Stripe first. This is significant for us.

However, Stripe also has 8,000 employees. Even if John or Patrick say, 'We want to do stablecoins,' dozens of individuals from different departments must truly buy into it for things to move forward.

The internal team at Stripe must genuinely grasp these benefits to be willing to allocate resources. If we face resistance within Stripe, it's actually no different from the resistance we encounter when engaging with external companies like Walmart, Robinhood, Revolut, or Nubank.

So the opportunity now is: in driving Stripe's deep integration of stablecoins, we can more quickly discover issues, understand concerns, find ways to address them, and then turn Stripe into the first and best showcase customer. In doing so, it will also serve as a strong proof externally.

Ryan: It sounds like your initial first customer Zulu, right?

Zach: Exactly, that's right.

Ryan: In the final question of this conversation, we have always treated stablecoin users as humans. But in another future, the biggest stablecoin users may not be humans, but AI or AI agents. What role do you think Stripe will play in this transition? Will AI really become the largest stablecoin user? If so, how far away is this future from us?

Zach: A few days ago, Sir Simon Taylor shared with me a viewpoint (I can't remember if I saw it on Slack). He said he had a conversation with a "monetary historian" and mentioned that every major technological revolution would bring forth a new form of currency to drive the development of that revolution.

An example that everyone can understand is: the Internet and credit cards. Without credit cards, the Internet would not have developed into what it is today; conversely, without the Internet, the prevalence of credit and debit cards would not be as high. In fact, credit cards appeared as early as the 1960s, but they truly took off in the late '90s to early 2000s, accompanying the Internet wave. Today, we cannot imagine an Internet without credit cards because it has become the default way of transferring value. And Stripe itself is an accelerator of this process.

I believe stablecoins will play the same role for AI. To enable full economic activity between AI agents, a new form of currency is needed to support it. And the existing fiat system poses many natural barriers to AI, the most obvious being: to hold fiat, you must be a human.

Ryan: Yeah, if you're not a human, that's indeed a problem.

Zach: That is indeed a significant issue. So I think we will quickly go through this stage: initially, many AI agents will be attached to human identities, borrowing human KYC identities to operate. But over time, they will need to have their accounts, to be able to make payments and settlement decisions on their own. Stablecoins and wallets can precisely provide this ability.

Another advantage is that stablecoins and wallets are very suitable for micropayments, variable amount payments, and streaming payments. These types of transactions are nearly impossible to achieve in today's traditional fiat currency networks because cross-border settlements are both expensive and slow. However, in the stablecoin ecosystem, all of this becomes feasible.

Ryan: Exactly, it's amazing. To me, it's almost obvious: the future financial systems used by AI will definitely be based on a cryptographic system. Their financial stack will undoubtedly be built on wallets, ledgers, smart contracts, and fungible tokens, almost without question. So, perhaps the next step for you all is to build a bridge between the AI layer and the crypto world.

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