The stablecoin revolution is here - are banks ready?

Speaker A: Foreign.

Speaker B: This is the London FinTech podcast, bringing you practical insights and approaches, stories and inspiration from the innovators who are building

Speaker C: the new world of financial services. I'm back now.

Speaker A: I'm fully recovered from Amazing Week of Money 2020 in Amsterdam. I'm, um, delighted to say that I spoke to so many interesting businesses and people, and one of the best conversations was this one with Ran Goldie from Fireblocks. Firebrox are a leading firm in the blockchain space, as you discover. Uh, in this conversation, I just want to say, if you're watching the video episode of this on YouTube on Spotify, we do have a camera glitch. It's only six minutes and we go to a holding screen. If you're on one of the audio players on Spotify or Apple, one of the other pod players that you won't notice. Let's go to the episode.

Speaker B: Welcome to London FinTech podcast live from Money20 20 in Amsterdam. And for, uh, those of you who are listening, um, welcome to conversation. I'm, um, with Rang Goldie from Fireblocks.

Speaker A: Thank you.

Speaker D: Thank you.

Speaker B: Good to see you.

Speaker D: Yeah, good to see you, Tony.

Speaker A: Good.

Speaker D: Thank you for having me here live at Money20 20 in Amsterdam. There's actually a lot of people outside that are hearing us. It's a bit, uh, scary because we're in this, uh, booth, uh, of glass, and people are looking at the outside. I feel a bit like, uh, species, uh, uh, look at the stablecoin guy.

Speaker B: I always tell the story. I have a professional broadcasting friend who says podcast casting is just like conversation in the pub. Just like Conversation Pub. This is like the weirdest pub, weirdest pub, weirdest pub. And we've just been. For those of you outside wondering what we were all laughing about. We were just having a conversation about who we look like. But that's a different, a different track to go down, I think.

Speaker D: Yeah, I will say, uh, if you're looking at Tony right now, he's Ed Harris. Uh, and we got to the point when I, I look like Borat, sounds like.

Speaker B: Yeah, okay, so we're not here to talk about looky like is. We're here in the context of the money stack rewired. And uh, you know, if you take a walk around hall, you take a walk around the seven halls that is Money 2020Amsterdam. There are 144 crypto companies here.

Speaker D: Oh, wow.

Speaker B: And that's what the media guys told me this morning. And, uh, so it's a crowded space. They're alongside the agentic AI firms, the biggest financial institutions on the planet. And, and the payments companies, that's really the broad spread. But we're talking crypto for far. Brooks is one of the largest, right?

Speaker C: Uh, Goldie.

Speaker D: Yeah, yeah, yeah, yeah. I mean look, uh, it's funny like we, we're an eight year old company, still young obviously. Uh, when we started, I will say 100% of our clients were crypto.

Speaker A: Right.

Speaker D: Today, eight years after, and again these were like the exchanges on off ramps, whatever. Today, eight years after, uh, I will say that 65% of our clients are either payment companies, Neo banks, banks, uh, FIs. The uh, crypto native crowd has been compressed a bit. But also again, the mainstream FIS of the world are coming on chain.

Speaker A: Yeah.

Speaker B: And let's put some numbers to this. So I spent a bit of time with your team earlier today. Oh, nice. So I've had a look at the product.

Speaker D: Did they say anything about me?

Speaker B: It's all good, it's all good.

Speaker D: Okay.

Speaker B: And I've got my primer. But uh, no, if you. Let's take a look at Fireblocks I think. And you'll put me right on the numbers, but I think you do $14 trillion of stablecoin transactions for clients annually. You got 2,600 clients and you're doing um, 10% essentially of the institutional stablecoin volume globally.

Speaker A: Is that right?

Speaker D: Yeah, uh, it's, it's, it's right, we did. So we uh, actually 15 trillion up until now. The interesting thing is that 6 trillion was last year. Right. So a lot of this is really happening over the last two years. And, and as you said, about 10%, 10 to 15% I will say, of global blockchain volume goes through fireblocks. So we really have this like, this really good view of what's happening on chain.

Speaker A: Yeah.

Speaker B: And we met briefly a couple of weeks ago and one thing you said to me is that the hottest thing in defi is, is tradfi, which is the title we gave this conversation because I really like that. And we're going to come to it. I think a lot of that institutional acceleration is recent.

Speaker D: Yeah, A hundred percent. A hundred percent. And we can get more into specifics and what people are doing, but I really think that, you know, Defi, as it was born decentralized finance was created years ago. Uh, right now what, what really people are using it for or the people who are using it are actually tried files.

Speaker A: Yeah, yeah.

Speaker B: So Goldie, tell us a bit about you first because you've been in the sector For a decade. And you were one of the early pioneers of stablecoins, I think, before they were called stablecoins. And you've had a bit of a roller coaster ride, as has the market, of course, but tell us a bit about that.

Speaker D: Yeah, uh, well, I've been here, as you said, a decade. Uh, I used to have like this amazing ponytail. Now I'm bald. Uh, so obviously everyone knows I'm in crypto, uh, or blockchain digital assets as we call it today. I started, uh, I guess my career started, uh, very boringly. I was a very typical geek nerd child, uh, in Israel. Spent my first 18 years running away from people who wanted to hit me. Then I got into, you know, more serious in computer science. Spent, uh, some time on intelligence. Had five colossal failures of startups before I found great founders. Had an ad tech company, took that public in London, fell in love with finance. Uh, and then I really wanted, not to have clients anymore, but really wanted to do finance. So we started Algo Trading company. We traded derivatives. This is before crypto or anything else that I even knew about. Um, and after that got acquired, I believe it or not, really did want to do something else in finance. But I was already sort of like captivated by this world of blockchain. Right? This was like 2016, 17, um, Bitcoin was on the rise. I was never a bitcoin maximalist, but I thought that blockchain has the chance to change the world. So I opened a blockchain payments company. I, uh, would say that no one cared about payments over blockchain in 2017. And again it was called, as you said, Fiat Pegged assets. Uh, it took some time. There was a roller coaster of. We had 70 people in the company. We had to fire 63. We were seven in the company. We grew back up again. We served dm, um, Facebook's uh, project. Back then there was like this stablecoin maybe that was supposed to get born. And eventually we were very lucky, uh, to I guess, you know, restart the company. A lot of people, we were very focused on stablecoins. It was stablecoin prime time in 2021 and we ended up getting acquired by Fireblocks, which again, I'm super happy to be there still today, five years after leading payments and network.

Speaker C: Yeah.

Speaker B: So your SVP payments and network, what does that mean practically?

Speaker D: Uh, it means that I get to live on the plane. That's my privilege. And make sure that if there is a payments company around the world that wants to do anything with digital Assets. It is. According to our CEO, it's my job to make sure it's on Fireblocks and only Fireblocks. And uh, if I mess it up, I need to get on another flight. Uh, but also the Fireblocks network, which spans again today around like almost 3,000 clients. Really, uh, all of these folks want to interact with one another. They want to feel safe. They feel safer when they know the counterparty is also on Fireblocks, which means they were vetted and so forth, and they can actually offer their services to one another. So I'm also responsible for that. And unfortunately I manage, um, too many people. Uh, so if you want to take my role, please.

Speaker B: I was listening to you on the orbital stage a little bit earlier actually, and given that all the payment companies are your job and I think you said that there are 325 of them. Yeah, yeah. That doesn't leave very many days in the year.

Speaker D: No, all my kids, I'm not Pavel Dura from Telegram yet, but yeah. 325, uh, companies that I look after.

Speaker B: Yeah. And it's certainly a fast moving space. So we've been talking with your comms and PR team for the last couple of weeks setting this up. And uh, there are, there are announcements coming out kind of all the time. You guys have made acquisitions and more recently there have been announcements on a couple of things, including today, I think. So what was today's, uh, big reveal?

Speaker D: Oh, today was, uh, checkout.com. um, well, basically the reveal was that we're now doing merchants settlement on the weekends with checkout.com we're helping them, I will say, uh, you know, deliver 24. 7 stablecoin settlement, uh, to their merchants. Which means that if you, if you know, if checkout is doing acquiring for you in the US for example, and you're a Singaporean business and you want to get your money the day after, even though it's a Friday or a Saturday, you can click a button and checkout and you will get Stable Coins delivered to your wallet. And believe it or not, there's right now thinking about Fireblocks data. Right now there's about probably $20 billion a quarter that are being settled to merchants by acquirers with stablecoins. Right. That's growing drastically. And it wasn't the case, by the way, two years ago. It was very low.

Speaker B: And so you were already integrated with Checkout, I think, so that the consumer could pay in stablecoin. But now, but now the uh, the merchant can get paid.

Speaker D: So, so they, they Took care of that. Yeah. The consumer side, and we've helped them in some areas, but. But we're very focused on, I guess, providing the infrastructure for companies like Checkout to do whatever they want. Front side, back end side, middle office, back office. Where. Where the infrastructure. So we're there to support.

Speaker A: Yeah.

Speaker B: So we started talking about Fireblocks, what it does. I think we sort of stick to that for a minute. I was going to ask you more about what's going on in the, uh, the broader ecosystem, but we'll come back to it. But for the audience, don't really know Fireblocks, and you sort of can't miss. Stand over by MasterCard on the end of the main hall.

Speaker D: Thank you, MasterCard, for doing a big stand next to us. We're honored.

Speaker B: There'll be some big crowds on that stage, on the Horizon stage. So you're right there. But, uh, um, you know, pretty prolific in the sector and you do quite a number of things. So perhaps just take a minute or two. You can sort of m. Unpack what's. What five Blocks does and why there's so much institutional interest.

Speaker D: Okay. So, uh, maybe I'll tell how we started also. Right. Because I think that that's super interesting. Um, when in. In 2018, if you wanted to move money, a lot of money, uh, between two blockchain addresses, then you would probably have to sign that transaction. People would use. You know what, I don't know if a lot of people know this called something called the Ledger, uh, for example. Uh, and it's like a discount key. Basically you would put in your computer, type in some password, and then you would sign a transaction. Right. And we thought that's ridiculous because there's no. That, uh, a technology that needs to, uh, I guess replace the current financial. Rails will be dependent on a human with a discount key that puts it in a computer and signs a transaction. So we came with this concept of how to do this securely on the cloud and how to secure transactions worth billions of dollars. Uh, I'm happy to say that we were in the right place and the right time with the right solution. Uh, and moving Money was our first use case. So every OTC desk back in the day, if you're familiar with, you know, companies like Cumberland or Wintermute or B2C2, these are like the heaviest, uh, OTC desk and market makers and digital assets. So they, Sorry, they really moved to Fireblocks as soon as they could. And that changed their business model because they were working five days a week. Right. I know how everyone saying crypto is like seven days a week, 24, seven. It wasn't right. It was basically like five days a week because the founders wanted to go home on the weekend and rest and not go and plug a discount key to a computer. So we uh, we sort of like upgrade that business. That was our first I guess cohort of clients. Then the second cohort of clients were the exchanges. There were a lot of exchanges coming up. So we created that very secure wallet infrastructure for all of them. And then the next cohort was payment companies. For payment companies we had to create you know, a lot of these different payment pipelines and flow because someone once told me this, you know how every payment company works? Asked how he said differently because basically they're all doing the same. Yes. But their flow internally is very different. So we had to support a lot more, you know, of the AML stuff and KYC and whatnot and created like a payments engine. Right. So started with secure wallets, then moved on to payments engine. And as the third cohort of clients started coming in, this is I would say in the last two years, uh, this was mainly around tokenization. Right. And I think by the way, and I don't know if we're going to get to that, but I think that really describes the three waves of crypto. First was trading, then it was payments, which is where we are today with stablecoins and I think tokenized assets, real world assets will be the largest third wave with assets like money market funds and whatnot. So we created this tokenization engine and so forth. So, and as you said over the years we also bought, this is recently we bought a company that is doing embedded wallets so that every today every fintech in the world is calling us or other people uh, and asking them can I, I don't know, like um, I'm uh, just an example, I'm um, a large marketplace. Can I add uh, a ah, stablecoin balance for my users.

Speaker A: Right.

Speaker D: That's what we call embedded wallet. Right. Um, and so we bought that company called Dynamic uh last year. Great founders. We only try to buy bold founders so I won't feel bad. Uh, so we bought them, they're great team. And then this year because again the type of client that's coming into digital asset is changing this year we saw a lot of uh, large institutions, mainstream companies like you know, um, food and beverage companies even like come in and say we need this infrastructure. And you know what they need? They also need a lot of reporting. They need A lot of integration to their TMS systems. So we bought this, uh, reporting reconciliation company called Tress.

Speaker A: Amazing.

Speaker D: Um, folks, uh, they serve like 200 clients like Binance and Coinbase and others, and they have audible reports and whatnot, and we sort of had to have that. So again, just to really sum it up, secure wallets, payments engine, tokenization, uh, embedded wallets and probably reporting. And this is part of a obviously larger platform that we offer our clients.

Speaker B: Yeah. And I love the Fireblocks name because it really is building blocks. Yeah. And I spent time with your team on the stand earlier today and credit to them, they really know the product. So I said, I've got 10 minutes. Yeah, I'm with Goldie. Later on, you're going to have to show me what's it do. And, uh, so. And if you haven't done that, had the demo, I can recommend it because, uh, it really brings this to life. The wallets, the payments, the tokenization. And we took a little dive in and said, what do you want to tokenize? Well, this is how you do it.

Speaker D: Yeah, yeah. So did you do a Tony coin?

Speaker B: We didn't do a Tony coin.

Speaker D: Yeah, we can do an Ed Harris meets Borat coin later.

Speaker B: That's going to go to the moon. Is that the right phrase? Yeah, to the moon.

Speaker A: To the moon.

Speaker D: I mean, you know, USDC to $2. Yeah.

Speaker B: So if you. It really is the building blocks. Um, but on institutional grade rails and infrastructure, so the privacy is there. Um, so I'm not surprised that you're getting the uptake. There is clearly an accelerating momentum around all things stablecoins and crypto. What do you think's driving that? Because, you know, when we met briefly in London, uh, a couple of weeks back, um, I don't know whether the number's out there, so I won't say it. But you had, you know, several, dozens of institutional grade RFPs that you're dealing with all at one time. Yeah, yeah. And, and I think the stat was sort 80% of the, uh, of the, uh, the pipeline was, was institutional.

Speaker D: Yeah, the future pipeline, definitely. Uh, what's driving it? Look, I mean, I think it's, it's a lot of things there. It's, you know, it's almost never one thing that's driving something. I think that what we've seen the last two years is a cascading effect of several things. I will, if you don't mind, I'll go back actually, uh, and I'll say I think that the first thing that happened that really started this like landslide was the acquisition of Bridge by Stripe. A lot of people, if you, if you haven't heard about this, Stripe, obviously one of the largest, you know, acquirers in the world, uh, payments company in the world really. Uh, they acquired this company called bridge for $1.1 billion. Bridge was uh, one of the best companies out there that's, that's moving stable coins and helping companies, uh, that are not in the space to get what we call on chain, right? To take their fiat, send it somewhere else. Do the stablecoin sandwich where you start with a dollar and end with Mexican peso. But you cross in the cross border leg, you use the stablecoin, right? So Bridge did that and a lot of other things and they got acquired for $1.1 billion. Everyone were shocked and not just by the price of that acquisition because Bridge, you know, Bridge deserve a great price tag, but by the fact that Stripe, um, has done that and no other PSP has done that. So all of the others were looking at Stripe and they're like, wait, what are we missing that the Collisons know is worth $1.1 billion, right? And then shortly after this was like, no, October, November maybe of 2024, shortly after the, obviously there was a change of administration in the U.S. uh, the whole pendulum swing of if you do digital assets, we will send you to jail stopped and it moved to please do digital assets. So Genius act came out. Um, and obviously now Clarity act in the U.S. mika went, you know, more live than it did and it has been improved. So it's regulations, it's the market. But I think what really happened is that a lot of institutions saw that their smaller, more, uh, risk taking competitors are already doing this and they were really waiting. And when regulation was released, you know, Genius X, specifically in the U.S. everyone was running, right? And now stablecoins, stablecoins or digital assets, like three years ago, even if you would want to do something with a, uh, bank, uh, you would have to find a crazy guy in the bank, you know, an anarchist in the bank to do something with you today. It's coming from the CEO and the board, right? They're pounding on the table. And before I wrap up, last, last story, uh, Prajit, the CEO of neom, I don't know if everyone knows anyone knows him here. He's one of the best CEOs uh, in the payment space. And I've been coming here to Amsterdam for probably like, I don't know, eight, nine years. Uh, and I've been telling him every time. Prajeet, you gotta do stablecoins. Prajeet. And then he keeps telling me, goldie, stop being a crypto, bro. Stop scamming me. I'm not buying your NFT and all that. I was never selling it. But anyway. And then.

Speaker B: But you can tokenize one for him.

Speaker D: I can, I can. Uh, yeah. Proceed.

Speaker A: Coin.

Speaker D: Basically, this year, after us having like so many battles, he was on stage saying, this was in Money 2020 Bangkok. He was saying, uh, I was wrong. We, the, you know, the industry was right. Uh, we're now moving four, I think, I don't know, like 400, 500, 600, who knows? Like, they're probably doing a lot of money, uh, moving a lot of money on this. Uh, and he was like, you know, it's actually amazing. It's saving us, uh, you know, settlement days and collateral all over the place and it's. We're going to move as much as we can to stablecoins.

Speaker A: Yeah.

Speaker B: And I think the stat that you shared earlier took you seven years to get 25 banks and you, um. And only a year to get another 100.

Speaker D: 100%. Yeah. That is amazing stat. I agree.

Speaker A: Yeah.

Speaker B: And I was listening to the Money Lab session on stablecoins yesterday, um, really trying to go back to basics and explain the fundamentals, and it feels like there's a rush to get, you know, to get the business on your infrastructure, which is what a lot of the big FIs are now doing with issuing the coins.

Speaker D: Yeah, yeah, yeah, yeah. It's. They're all in. Look, they're all in FOMO mode right now. They don't need to be because, uh, you know, it's just starting. Right. Uh, it's like AI, really, that, uh, uh, everyone is FOMO, that they're behind on AI, but if you actually look at the stats, only 7% of companies in the world are using it, so you're not behind. So there's. We're good.

Speaker B: But it is still the next 50 years of finance, which is a label that I think so increasingly being endorsed.

Speaker D: Yeah, yeah. Well, 50 years is just like one automation project for a bank.

Speaker B: Right. We were talking about that in the sunset session earlier on. Um, so let's stay with the big fis for a minute. So I am, let's say I'm Mega Bank. I'm one of the, uh, one of the firms perhaps, who are sitting on the balcony row at this event because I've noticed a lot of them around the top having.

Speaker D: Yeah, yeah. Ivory Tower.

Speaker B: Yeah. And. And I've got my fomo. So I've realized that this is now uh, board objective that I uh, need to um, rewire for crypto Rails and maybe get my own stablecoin out as part of that, you know, what do I do, um, apart from walk to the end of Hall 6 and talk to fireblocks. But you know, how do these institutions, how do they know Thinking about transforming onto crypto Rails.

Speaker D: So it's a really good question because the very honest answer is that most of them do not know up. And it's not because, uh, and we do get to an answer, I'll give you the answer by the way, but when they come into the discussion, you know, first time they don't know and they're very honest about it, they're saying, look, we've been ignoring this, uh, we now understand it's important, let's you know, help us learn. So they're not necessarily coming with an opinion on what to do. And then after we, you know, we uncover it. And again, working with a bank, it's, you really need to figure out, and I know you've, you've done this like you really need to figure out like there, there's, you know, there's 30 departments, right? There's, there's equities, there's fixed income, there's, there's the trading desk, there's the high net, high net worth individual desk. There's like so many desks, everyone wants something else, right? Show me the motivation, I'll show you the result. Eventually where it boils down into is usually one of, I would say three things. One is they all end up want to do transactional banking. They all understand that their clients need a stable coin account, a stable coin balance not necessarily materially changed than an FX account that they have for pounds, euros, dollars, whatever. Second thing is uh, tokenized deposits, right? They understand that they need to be moving money 24 7. Now the right way to do that today is either re, you know, do a full rehaul of your banking core infrastruct, not something they really want to do, or create a layer of tokenized deposits, uh, above your money, let's call that. And then the third thing that some of them come to is we want to issue a stable coin. I will say that we tell them please don't because we have a lot of doll denominated stable coins. And it's, it, it is like ah, a heavy lift.

Speaker B: How many are there?

Speaker A: Are there?

Speaker D: What stable coins? Ah, more than 1200. Yeah, that's crazy.

Speaker A: It's crazy.

Speaker D: Uh, but, um, but, but some banks, like, look, some banks, uh, it makes sense for them to issue I will say a coin because the utility for them is, is, is different. The liquidity corridors are different. But, but for most, I would say that, you know, if you do tokenized deposit, if you support the main stable coins for transactional banking, you're probably going to win.

Speaker A: Yeah.

Speaker B: So how long do these projects take then? So you, it's interesting point about, you made about not replacing or rewiring the core banking system because if you go front to back and we talked about various trading desks, but then you've got middle office back office finance, risk, um, uh, and then all of the um, gateways and venues that sit as part of that ecosystem, um, for any incumbent you really don't want to be rewiring, um, that stack effect is probably practically impossible. But how long do these projects take? I imagine standing up the fireblocks bit is probably the quick bit.

Speaker D: Yeah, we're usually not delaying, uh one, um. How long does it take? Well, I will say it usually takes from the time we actually signed a bank and they're starting an onboarding which also is not, you know, on average that takes 201 days by the way, to get a bank. That's not bad, right?

Speaker B: Sign the contract.

Speaker D: Yeah, yeah, yeah. I met people who told me that they've been with RFIs with banks for six years. Right. So, so I'm, I'm okay with 201 days.

Speaker B: People who listen to this show regularly know that my real day job is running Next Wave Consulting, next gen consultancy. And we are a small firm that sell to the biggest banks and investment firms. And our record I won't name the US bank was 18 months M to get an MSA. Okay. Yeah. But then on the other end we can sometimes do it in a week with mid market firms. But uh, that whole mismatch, uh, between agility and innovation at one end and big corporate the other is sort of ever been thus and it hasn't got a lot easier.

Speaker D: Yeah, yeah, you're right. So, so while the sales cycle did get shorter because of the board pressure and all those things, uh, it still takes nine to 12 months to get a uh, working pilot. And look, I'm not complaining because I was told by this banker that I seriously appreciate, he told me, listen, it took us two years to do this project. In banking times, uh, that's like a second you need to say thank you. You know how long it took us to implement FedNow and RTP and the new ACH mechanisms like 7, 8, 10 years we've been working on this, right. So I take this with uh, a grain of salt that uh, obviously that it takes time but I think they're on the right track.

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Speaker B: In terms of uh, stablecoins versus token deposits, how do you see the trajectory? Because there is a debate about one being more portable than the other and um, how deposits maybe will take over. But then the counter argument is that they're not interoperable the way that stablecoins are.

Speaker D: I think there's, there's several camps right now. Uh, you know, let's start with the facts, right? The fact is that a tokenized deposit is a tokenized deposit and it's usually it can be in a bank. That's why usually people use it only in a bank. It cannot leave the bank.

Speaker A: Right.

Speaker D: And a stable coin usually uh, I would say belongs outside of the bank because you know, banks do not happily coexist with uh, a lot of stable coins on their balance sheet because they don't like the one to one ratio obviously they want to do fractional reserves. They want to, right, they want to use customers, uh, funds, deposits for loans and whatnot. Um, I think that if you ask me what my theory Is is very similar to what SoFi did. And I'm sorry, um, if I'm doing like shameless plug here for SoFi, but I actually do it. I think what they did is super simple and super smart. They created this coin called SO USD. It's their stable coin. When it's in a bank, it's a tokenized deposit. So if it's within the wallet of the bank account holder, the business that's holding that account, it acts as a tokenized deposit. Which means that uh, the banks can take whatever is in the reserve and fractionalize it right when it leaves the bank. When you as a client send that dollar denominated stablecoin to a counterparty outside of the bank, it becomes a stable coin, which means that the bank now holds one for one for it. Now just the fact that the regulator approved that mechanism, which they did, I think is remarkable. And I think that is. We'll see more of that. I think the other thing that people will claim is missing and this is where, you know, companies like ubix by Tony McLaughlin is relevant, is uh, is clearing. Right. How do we allow all these different stablecoins to clear uh, whatever. And the banks feel safe that it's not just an IOU by a corporate. It's not like corporate money. It's actually there's a clear behind this that support supports 100 billion of USDC that I have on my balance sheet or whatnot.

Speaker A: Yeah.

Speaker B: And at the time of recording this I think UBIX are on the stage. Yeah, to our left actually.

Speaker D: Yeah, Tony's killing it as always.

Speaker B: It's a punchy conversations, um, judging by the one that I overheard yesterday. So just switching tax a little bit Goldie. Um, so you said, and I didn't know that stat that you'd had five startups before you really hit your stride, uh, with what I think was called first, uh, digital and then you've been through the innovation cycle, uh, prior to Fireblocks, uh, and Fireblocks itself has been acquisitive. We talked about that. But what is it about the Fireblocks environment and culture perhaps that uh, has m made those acquisitions succeed?

Speaker D: Well, I uh, think that, look, we were very afraid of doing acquisitions, uh, and I think that the fact that we really put an emphasis on founder DNA, uh, and company DNA that the company were acquiring, uh, was, was material. I will say, uh, it has happened in the past that we've seen targets where we thought this is an amazing product, but this team is not, probably would not would Feel very challenged to work with our team because, uh, and again, a lot of the product and rid folks are in, are in Israel. Uh, Israel is, uh, Israelis. Some people work with Israelis here. My condolences are very, you know, very. I would say people who want to work 247 in a way also think their peers should be working 24 7. Uh, uh, so we, we did not always find a fit, but if, when we did, like with dynamic, like with trust, it's just magical and these folks are, are killing it.

Speaker A: Yeah.

Speaker B: So really just looking for that cultural fit and sort of shared, shared uh, focus. So we talked about sort of the human side of it. Actually no conversation at Money20 20 would be complete without the uh, without the uh, the agentic side of it, the AI side of it. So how, how are you at ah, fireblocks, positioning for the next wave of users which are going to be the bots and the agents?

Speaker D: Yeah, yeah. Well, we're, we're, I will say we, we took our sweet time. Uh, because I felt there was a lot of AI washing in on, you know, LinkedIn and generally PR that everyone was like, oh, now everything we're doing is gentic. Everything is, I don't know, AI ready or whatnot. Uh, we did take our time, uh, and we were looking at, okay, what do people really need? What we ended up doing is, first of all, we joined the X402 foundation because we felt like there are things we want to be influential about. Like we already uh, uh, uh, sent some, I guess, remarks on security and we've done some like, suggestions on how to adapt the protocol to be more secure. I guess that's our thing. Uh, and then what we did release is a way for the payment companies that run on fireblocks to automatically adjust their checkout pages so that an agent could read through them. That's the first thing we did. And the second thing we did, which is actually different than how everyone else is thinking about AI, is that we created these wallets that you can uh, delegate access from them to your agents or to your agents to them. So what I mean by that is when you look at the space, everyone is saying, oh, you can now issue wallets to your AI, or now you can issue a card to your agent. We don't think that's the right way because we don't think that. Again, we know treasurers, ah, really well. If you open, let's say a company would have a thousand agents each one, you'll issue a wallet which is really an account to Them a treasurer doesn't like another thousand accounts to reconcile, that's a pain for them. So what we did is a whole different approach. It's like you are giving specific access within enterprise policy to agents, to your account, to your main account and yet you can still control this on uh, a microsense level of what's coming in and out and who has access to that. And we think that's better than adding 10,000 reconciliation services, user access control, uh,

Speaker B: sort of wallet controls for your digital users. Yeah, I think that agent wallet control is already a thing, it's become a bigger thing. I uh, was um, on a, the startup panel earlier today at the event and there were sort of seven fast startups that the conference have identified and the one that actually couldn't sit on the panel I think because they were too busy. Somewhere else on the floor is Catena Labs who've just raised 30 million.

Speaker D: I agree. Look, honestly I don't know where, I don't think anyone knows where this is going at. Right. The agentix side. Uh, I'm super excited about the predictions that um, I think like in I don't know, five years we'll have 25% of commerce through agents. I really want to stop browsing and I want my agent to do stuff. Uh, but right now my agent feels like a six year old that I need to uh, you know, to train every day.

Speaker B: Yeah.

Speaker D: So, but, but I'm, I'm excited.

Speaker B: I mean you're right in the uh, in the center of this super fast moving space and you're an innovator, uh, a builder and also an entrepreneur. So. And as we noted been on quite a, quite a ride. I mean I didn't really pick up on it at the beginning but going from a team of 70 people to seven. Yeah, that was just brutal.

Speaker D: It was.

Speaker B: I mean we did a pivot in the consulting firm and we had to let a few people go but the proportions were the other way around. And so um, I can't imagine what that felt like um, at the time and we won't have time to really talk about it. But I did want to ask you is you know, takeaways for the audience and the entrepreneurs out there. I always ask that ah, on, on my um, LFP episodes is all you know, fol are often um, late career, mid career. We've got 10, 20, 30 years uh, of learnings. What's the thing that you've boiled down that perhaps you wish you'd known at the start that you'd like to Share with everyone else.

Speaker D: Wow, that's such a hard question. Uh, what I've learned. Look, uh, I don't know if I've, I don't know if I can say one thing because like so many things are important that I think that needs to come together. I think that the one thing I will say is, uh, I read a book after about several startups that I did. And that book is called, uh, Four Steps to Epiphany. And what I've learned about that book is that I did the entire process of uh, of customer discovery and POCs and, and feedback loops. I did it all wrong and I thought I'm doing it right. I really thought I know what I'm doing. And it's like, you know, what do you mean customer discovery? Of course I went and asked them. But no, if you actually read this book, there's a really good, it's a really good cookbook book to how to create a good startup. Um, so I would say, you know, the customer first and foremost and the second thing I'll say, and I was not good at that in my early startups and I became really good at it, you know, in my LA ones is that. And again, I'm quoting from, from good to great. I think, uh, get the right people on the bus and the, and the wrong people off the bus, uh, and it, it's really hard to hire, but people are having a even harder time to fire. Some people just don't fit certain environments. They might be great in other environments. And as if you know how to recognize that within, you know, two months tops, you, you, you'll just build a better team over time. All the time.

Speaker B: Is that Four steps to Epiphany?

Speaker D: Four Steps to Epiphany by steel Blank. Do not get royalties for that, but go and buy it.

Speaker B: Lastly. So, yeah, price of bitcoin by Christmas.

Speaker D: Sorry, what? By Christmas? Bitcoin price by Christmas. Uh, I would go for, uh, by Christmas. Let's see. Christmas you go up, down. Yeah, I'll say like 45k.

Speaker A: Okay, interesting.

Speaker D: You didn't see that coming. No, no, not the Christmas you were hoping for.

Speaker B: Okay, well, I've really enjoyed this. So we're out of time. Um, and there's still another day of conference ahead of us. But, uh, thank you for sparing the time to come and chat.

Speaker D: Thank you for having me.

Speaker B: I hope the audience enjoy this fun.

Speaker D: Yeah, yeah, this was great. Thank you Tony. And thank you for the people who are listening. You are all beautiful and amazing.

Speaker A: Thank you. Mhm.

Speaker D: Sam.