Part 2 of 3 – Solving a common problem for stablecoins and RWAs – Crypto Conversation Podcast

The following is a transcript of the Crypto Conversation Podcast with Fran, held on 19th September 2024. It is split into three parts.

The transcript was generated using AI technology and has been carefully edited to align with the actual podcast. Some light editing has been applied to remove repetitive content and improve the flow of the conversation, while maintaining the integrity of the original discussion.

Part 1, looking at the origins of the Stabull Platform is published here.

*** TRANSCRIPT PART 2 of 3 BEGINS ***
Solving a common problem for Stablecoins & Real World Assets

Andy Pickering: Very nice. Thank you Fran. And you know, I suppose it would be good if you could maybe just explain why you see it as important, why there’s a gap in the market, I suppose for like a DEX or an AMM that specializes in facilitating capital, efficient swaps between stablecoins, right? 

And I think there’s a particular focus or there was at the start, certainly on non-USD stablecoins. I’m sure that will change over time. But so I guess just two questions, why is it important for people to have that ability to seamlessly go between different stablecoins? And also why the focus on non-USD, 

Fran Strajnar: Well, you know, since Bitcoin was invented and adopted in the early days, the dream was always to have programmable money, frictionless, fast, instant, global, you know, and while we would love to issue everything purely on Bitcoin, the tooling is simply moved to EVM chains for the time being. 

Look at the systemic risk and the bottlenecks for frankly the unnecessary and burdensome level of compliance in the old world. It is so difficult to move your own money, right? I wanna pay contractors in the UK and British Pounds. It’s just a pain, you know, half the time the transactions get returned because of some intermediary bank filled out a form, dots in the wrong place or, or whatever. 

It slows down the economy, it slows down innovation and money should be able to seamlessly transfer value should be able to seamlessly transfer. So, look at the SWIFT system, even the BRICS nations have built their own alternative to the SWIFT system. They represent dozens of countries now and, you know, a huge portion of the world trade for agriculture, energy, etc is already moving away from the USD and the SWIFT system. All we’ve done is said, well, ok, so everything is moving on-chain, why don’t we have absolute finality and clearing and settlement for foreign currencies and commodities that is as frictionless as possible. 

So some of our investors are telling us if you get this right, you’re basically an alternative to the SWIFT network, you know, for clearing and settlement of these assets on-chain. So I think, you know, this is what the world should have – quick, fast, permissionless, you know, ability to swap one asset to another. 

So if those contractors of mine in the UK accepted British pound stablecoins, it would be a dramatically faster, you know, payment cycle than the legacy world. That’s just one of countless use cases really.

AP: Yeah, and another way of describing that. So, you know, you reference the SWIFT network, but it’s another way of saying really, you know, the global FX market or exchange market, which is, I wouldn’t even want to guess how big that is, but that’s, yeah, so this is the DeFi crypto-native version of an FX market, isn’t it? 

FS: Yeah, basically it’s like we also want to attempt to democratize interest rates. You know, I think the world is waking up to the fraud of one hundred something years of central banking and you have effectively the Federal Reserve today, cut the interest rate by 50 basis points, for example. 

Now what if users of the system were to vote on what the rates would be, you know, so that’s also what we’re doing with Stabull, is periodically every quarter, probably starting in April sometime there next year, users of Stabull will be the ones that actually vote to how much interest rate should go towards which trading pair. 

AP: So tell us a little bit about where Stabull is at the moment, I suppose on your product journey, I think Stabull has been live for, I don’t know, a year or two now, right? So how are you going in terms of how deep are those pools getting? How used to the process are people getting in terms of being able to swap the various stablecoins? And yeah, there’s a token as well that is coming that’s a governance token for you guys. Just explain where Stabull Finance is at the moment Fran. 

 FS: Yeah, sure. So firstly, the company life cycle where we’re at. So you may have heard of Stabull a year ago, but we certainly weren’t live for that long. We’ve only just come out of stealth mode effectively a couple of weeks ago. 

So we spent the entirety of 2023 doing research and development, talking to issuers, getting to understand the landscape, who has which tokens on which chain, who are they partnering with? Which chains are they expanding to? How are neo banks kind of, you know, circling around and all of the rest. And arguably now we have one of the best sets of visibility across the entire global RWA stablecoin space. It’s hugely beneficial. 

It took us a long time to settle on the actual technology solution design, right? Because we have to incorporate technical, operational, economic considerations and then extrapolate that out into long term game theory, so that we can create a system that can run itself and has an equilibrium between, the interest rates, the governance voting, because we don’t want to have sort of fringe cases like Curve, that, I don’t know if you read the news, but the original founder was liquidated through vampiric kind of attack vectors on the open markets.

So we built it on Ethereum and Polygon to begin with using developers that I trusted and worked with for over eight years now. The platform only does two things just to be very clear, you go there to swap one asset to another, whether it’s Swiss Francs or tokenized gold or whatever, or you dust off your assets and you add liquidity to earn an interest rates.

And so we went through the QA, and then the alpha testing, and then the beta testing because security is paramount and so is the user experience and everything else. So we’ve done several rounds of polishing, UX/UI and the whole interface and the back-end and everything else and securing some absolutely critical partnerships that allow us total decentralization later, we can talk about that in a bit, how we’ll become unstoppable over time. 

And so we’re now at a stage where we effectively have a small set of pools on Polygon and Ethereum. We’re signing letters of intent and agreements with various issuers and market makers to add more liquidity. We’re growing our socials now that we’ve come out of stealth mode only like two weeks ago, and we’re effectively preparing for a full launch around mid-November. 

And so, we hope to see the TVL increase and the usage increase now that we’re slowly coming out. But we have some megalithic partnerships and campaigns lined up, some already starting to activate, a very important one starting on the first of October. And that’s gonna be what’s called a user acquisition campaign where we get people to,load that app or dApp, perform a swap, add liquidity and then they earn airdrop points post-TGE in the future. TGE will be after the public sale, which is in mid mid November during the big launch. 

So after TGE, the platform is effectively feature complete because the Liquidity Mining program, the interest rates, the swaps, it’s all there, right? 

So also I guess it’s important to know, you know, like the recent news was Black Blackrock has thousands, tens of thousands of employees and billions in revenue. And Tether has, what 60 or 80 staff members? And just announced they got larger revenues than Blackrock. That’s the power of DeFi and Web3! 

Stabull doesn’t need thousands of staff or even dozens really to scale to billions of dollars in daily trading volume. So our objective is to become a top 10 DeFi project and expand chain-to-chain and do the various integrations. So the only thing we’ll do moving forward is just integrating more chains and adding more pools. And again, it’s just highly scalable that way.