🐄 Staybullcoin

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One of the biggest ways for crypto to win is to make it easier for outside folks to really understand the tech. 

I’m a huge proponent of financial literacy — having even hosted my own show focused on it — and that’s part of what drew me to crypto. However, the industry sometimes makes its own job harder in the way it markets itself. 

I vote we simplify things, kind of like a16z did when it said stablecoins are the “WhatsApp” moment for money. Boil the tech down to something bite-sized and — bam! — Grandma now understands (and is hopefully eager) about the rise of stablecoins. 

Let’s make our jobs easier, not harder, right?

Meanwhile:

• Bitcoin’s back over $81K, a 6% jump over the past day. ETH’s over $1,500, a 9% increase in the same time period.

• Total stablecoin value sits at $226B, a slight increase over the past month.

• Despite the market craziness, DEX volume is still up 23% over the past week, per Blockworks Research.

🧹 Neatly organized

We’re thinking about stablecoin classification all wrong, Agora CEO Nick van Eck told me. 

It’s easy to lump all of the stablecoins into one single bucket, but the reality is that the offerings are quickly becoming more unique and different as the space matures. 

A lot of stablecoins are “very different, and have very different user profiles,” which means they “ultimately don’t even end up competing.”

“Someone who is looking to use USDe as a form of collateral is 95% of the time probably not the same user of AUSD or USDC. Maybe they'll use it for trading, but [if]… you want to buy a treasury bill or a treasury bond, you don't buy a corporate bond, right?”

You have centralized high-trust stablecoins, which include Agora or Circle. Then there’s centralized opaque, which would be Tether. The difference between the two is the amount of transparency offered, but both categories are focused on the global monetary network perspective.

Another is “centralized captive distribution,” which includes gaming companies or banks like Bank of America (CEO Brian Moynihan previously teased that the bank’s interested in such an offering). The idea here is that companies in this category are more interested in keeping their stablecoin offering within their business rather than expanding globally, van Eck explained.

The fourth and final one is decentralized stablecoins. This broader category captures the likes of Ethena, which van Eck praised as a “very good operator,” and some of the more experimental forays into stablecoins.

Agora’s customer base, van Eck noted, is usually made up of folks just coming into crypto, not more seasoned people who want to make a return on their collateral.

The team aims to create a global stablecoin network. 

“We see a world where AUSD is traded on every single exchange and has global liquidity,” he told me. This opens the door for folks to build on top of Agora and “tap into our tooling and cross-chain infrastructure, our centralized exchange infrastructure, our FX on and off ramps.”

As lawmakers mull and vote on stablecoin legislation, van Eck is excited about what it means for the space. While he told me never say never when it comes to yield-bearing stablecoins — that’s not going to be a priority for Agora. 

“From day one, I was very much expecting that the US government and the SEC would not allow interest-bearing stablecoins, which is why we designed our model as one-to-one, where we just share underlying economics with the businesses, versus it being natively yield-bearing.”

No skin off of Agora’s back, especially since it seems lawmakers aren’t too keen on yield-bearing stablecoins, either.

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• Cardano’s Charles Hoskinson is also pretty bullish on stablecoins, predicting they could be adopted by the Magnificent 7 stocks.

• Please, please, please: OpenSea is asking the SEC to clarify that NFT marketplaces aren’t actually exchanges under securities laws. 

• As of last night, Paul Atkins is officially the newest chair of the SEC.

🤔 Wen adoption?

Agora’s van Eck is pretty realistic about where the space stands right now. 

Clearly, there are plenty of reasons to maintain a bullish attitude. But he cautioned folks to rethink the time horizons when it comes to adoption. 

The CFOs and CEOs of large US corporations aren’t necessarily aware of the developments in crypto, even when it comes to something like stablecoins. Van Eck believes we’re looking at a much longer time horizon for adoption — three to four years — versus the optimistic one to two years. 

Van Eck told me he’s having plenty of conversations with folks in the TradFi space — including some of the largest hedge funds in the US — and that there’s still a lack of understanding when it comes to the role that stablecoins play. 

“We live in our own bubble in crypto where we think everything that's going on … everyone else in the world is aware of, right?” But that’s not the case. 

The real curve we have to tackle is educational. We’re in the early innings here, and that’s the big hurdle now that the regulatory picture is so much better for crypto. 

However, once people understand, van Eck is pretty bullish on the stablecoin sector taking off in four to 10 years.

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On our minds: Stablecoins