Zebec x Stellar: Bringing Enterprises Onchain

I'm going to have a great time. Hey folks, I'll say here. Hey, how are you doing Jose? I am good, how are you all? Very good, thank you. That's a good as mic check as any. So that's what I usually do. You've given me that one and we're going to get things started here. But great to have you with us and thank you for joining. Thank you for having me. Lovely job. Okay, well look, I'm not going to continue with any niceties, JJ. I'll speak to you at the end. Thanks for setting this up. Welcome everybody to another Zebeck spaces this time with our friends at Stella. Really excited to do this one. There's been lots of discussion over the last few years about institutional adoption of blockchain. And I think there's quite a big difference between an institution experimenting with blockchain and an institution actually relying on it to move money. And that's where today's conversation kind of fits in. We've now got payroll running on Stella through Zebeck. We've got regulated stable coins being used for employee benefits in Europe. We've got money, Graham who have also joined us today providing a route back into the local, into local fiat. And at an entirely different scale, we've now seen sovereign payments and universal basic income distributed via Stella. So perhaps we're getting beyond the point where the interesting question isn't, you know, or is should I say whether blockchain gets adopted, the better question now might be what actually has to happen for blockchain to disappear into normal financial infrastructure. And I couldn't ask for, you know, two better people to help answer that question. So we have Simon, CEO of Zebeck joining us today as ever and Jose Fernandez de Pont, president and chief, chief growth officer at Stella. So I'm going to very quickly say hello to Jose again. Hello, Jose. You're there. You're good. I'm here. Yes, everyone. Great. Thank you so much. And Simon, I'm going to jump straight into things with you. Give you a quick opportunity to set us up here. Before we get before we get things moving, this is a space as I know that you've wanted to coordinate for a while now. Just talk to us very quickly, kind of overview basis about the Stella relationship at Zebeck. Exactly. Well, we're really happy to have Jose from Stuller here today and all the great community listening. As many of you know, Zbeck has been the stablecoin payroll partner now for for Stella for a while. And it's a partnership that we've really been cultivating over the past year. After many months of testing and development, we went live with enterprise payroll on Stella this June. And the rate of adoption from these large global enterprises has been a lot stronger than any of us initially anticipated, particularly in such a short period of time since we've launched. So both Stella and Zbeck are really committed to building up this core use case of contractor payroll. But from here, where we've expanded into cards, we've expanded into remittance and soon to be corporate treasury. So what we're effectively building together here is a full stack stablecoin solution for global enterprises to pay their teams, manage their expenses and move and invest their idle capital all done fully on chain in a compliant way. So we're really excited and dig much more into this today and get into the details. Love that. Thank you so much, Simon. Jose, before we get into Stella specifically, I would love to, if it's okay with you, just cover your career a little bit because it gives us really interesting perspective on all of this. You have personally seen financial infrastructure from several completely different positions. So banking at BBVA, global payments at PayPal, you actually helped drive PayPal's early crypto efforts and ultimately PYUSD. And now you're sitting at the protocol layer with Stella. So when you look at enterprise adoption today, what has fundamentally changed from the conversations you were having five or 10 years ago? Yeah, I think that and just summarize that very, very well. Yeah, I've been in around payments for the best part of the last 20 years or so, both at BBVA on the banking side and at PayPal. And I've been involved in in blockchain some moving money around decentralized ledgers for the best part of the last 10 years now, probably. I think that it has changed quite a bit. And the first intersection that I did was moving on an enterprise setting that was moving digital dollars from a bank account in Spain to a bank account in Mexico with back in 2016 until now. First, the product and the technology is much more established. If you look at things, when you're moving money, that's a mission critical system back in the day, we still have a with the exception, probably. Stella, which has has four or nine sort of availability since since launch 12 years ago, but technology was still fairly barebox. There were some other jizz, there were the on drums and the offrams were difficult to do. And we were still five years ago, enterprises were asking about, is this really enterprise great? Can I technically make this happen? Is this just for individual users or for people who are going to be doing crypto trading? Do we have a product that I can rely on? I think that the conversation that has that conversation has changed a lot in the last I would say, did you know how for so? In the papal years when when we launch a pure is the paper stablecoin on stellar another chance and also crypto trading on paper and memo. A big, big part of getting that done was distribution, right? So how can we get digital assets on platforms that can reach out to hundreds of millions of consumers and merchants. And I give PayPal a ton of credit with leading the way on that. We are seeing more and more companies and institutions that are doing it. The program is obviously a very, very good example. You have folks who are working with us now. They range from PayPal and monogram to Frank in Templeton, US Bank, a moondy wisdom tree, you name it. So both on the payment side and on the asset management side of financial services, we have seen a ton of validation where the enterprises are saying, yes, I trust in the technology. We agree that this is ready for prime time from a technology point of view. And the conversation is moving very quickly toward distribution, user experience and how do we put this in the hands of the users. Yeah, absolutely. I love that. I mean, obviously tokenization is a big part of that institutional shift at the moment. Where are you guys seeing it? Like move beyond experimentation into practical use first. And how do payments fit into like the broader picture of what you're doing? Well, I think that you see movement to scale in many, many aspects. We're reporting our numbers for Q2. We are about to report the ones for Q3. But just on the Q2 numbers, we were saying about 11 billion dollars of stablecoin payment volume that was moving on the network. So this is something not just being used sitting idly and collecting gil which are very valid use cases. But we built this network for real life and real world financial use cases. We get a lot about money changing hands on the network. The 9 billion are a combination of yes, people on the crypto trading side moving money around better users of a Sabaq executing payroll or global payouts or cross border remittances, the monogram side of the house. So at scale on the payment side, I would say that probably cross border is still the preeminent use case because it just makes sense. It's a better rail is a better tool for for the job. I am actually quite excited about what we are starting to see on the consumer side on consumer payments. Funnily enough, it feels like the way that consumers are adopting stablecoins for payments are through a stablecoin funded card programs. And we have a number of partnerships in that space where people are just used to the credit card to the plastic that they can swipe and tap and pay. And we are seeing incredible growth in that space and global treasury so corporates who have to move funds between foreign branches. And when you are talking to a treasurer and they see that they don't need to be involved in the mud rush to make sure that the wires have been sent off from headquarters before noon of Friday so the money is sitting where it has to sit. And the ability that hey, I need to deploy more funds in let's say the Philippines over a weekend and you can push funds there and they arrive in 10 minutes and are the fraction of the cost. That is that is the whole spectrum the places that I am the most excited are a corporate payments and treasurer movements because I think that builds the initial scale. And then when you have that liquidity getting the consumer's cases is easier so liquidity and capillarity are the key factors of the game now. And I think that is a fantastic and would you say in your view that we're finally reaching the stage where like blockchain can become as invisible kind of like similarly invisible financial infrastructure as say like when you started at Stella you made us a comment that really stood out to me which was your view was essentially that like product market fit for blockchain should be invisibility. And so is that is that we get closer to that phase now we are very much getting closer to it we know they're yet sounds like strikes donkey on on that one we're definitely not there yet but we are getting way way closer and I think it's important that as an industry both from from the infrastructure side from players like like the stellar foundation but also from the application side from the siblings and others. It is important that we extract the complexity from the user I think that is a very high bar if for adoption we are asking an enterprise or a consumer to get comfortable with the libtic curve cryptography and consensus protocols on how the validation of a transaction works we we need to abstract that away abstracting it away doesn't mean that we ignore that complexity. We spend a ton of time thinking about the security of the network the resilience of the network the consensus how it works how do we increase the number of tier one validators but we do that so that users don't need to I think that is a really high bar of understanding if we are asking users to be really in the weeds of how a blockchain works and we need to just be able to provide them experience that is similar to do what they are used to and it just works better when someone likes a better. It is like it enables a company to pay to make payroll on a stable con rails. Enterprises are not going to move away from the ERP's or the interfaces that they are used to to adopt a totally different part of it they want affordances they want a experience that they are comfortable with and that they are used for and we need to meet them where they are. We are not there yet we are definitely closer than we were five years ago. But if that is the destination Jose you know what still prevents large enterprises getting there is if we are saying that the kind of like the limiting factor isn't as much the technology anymore is it regulation is it distribution UX you know what are the things that we need to really focus on getting aligned for this to move forward. All those three are highly relevant so on the regulation piece and specifically talking about stable coins I think that the passing of the genius act was a massive unlock on the enterprise side and especially on the traditional finance side of the house. So think that even if we are able to put now stable coins the money gram ramps and pushing the money from the back and ending in 170 different markets. There's still a lot of people will need to convert that stable coin into fiat in the local bank account or a sketch out right. So something like genius being passed which obviously had an unlock effect in the US but also had a knock on effect outside of the US and gave financial institutions a ton of comfort about we can actually do banking business with these companies and we can engage on stable coin transactions that is a massive massive unlock I don't think there is anything if you're working on anything that matters more likely than not it is going to be regulated whether it is financial services or energy or health care. So you need to embrace that regulation and we need that regulatory clarity genius was was a big big one and it was the as I said a massive unlock on the financial space the UX is important we need to make this. We need to meet the users where where they are but especially I believe that what you need you need to think of this is a little bit of a two side and market places let's think about the payroll use case so you have enterprises we need to to make payroll or or pay out remote workers and you have the remote workers on the other side is a little bit of a of our enforcing fly will the enterprises are going to be reluctant to do it if only point. 5% of the users are asking for it and then more people are going to ask for it when it is more broadly available so to say the market places take time to build we need to build the supply and the demand at the same side at the same time the back is doing a fantastic work at making sure that you can do that in an easy convenient way on the price side monogram is making is doing a really really good job at making sure that it can be made available to the consumers but we'll see the time I think that is one of those where you walk toward 10% adoption and then you you see the the high the increase of that is curve. It will take time you need to build both at the same time absolutely thank you and thank you for giving me those answers that fantastic and it's really good to kind of get to know you and a bit more about your background and it brings us perfectly into what zebac and still have been building together and Simon I just want to bring you back in here now. One thing I find interesting about payroll for example is that it's actually a fairly unforgiving test case right sending somebody crypto once is easy but running financial infrastructure that thousands of people depend on every week or month is very very different so why did zebac decide payroll was the right place to prove this technology at enterprise level. Well you make a very good point then when you think about a big picture payroll has not changed materially in the past 70 years and going back to what Jose said as well it's a two-sided market.