The Hidden Costs of USDC | Nathan McCauley & Charles Cascarilla
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The problem that they solve is that they're holding, USDC and deriving no revenue from that. In fact, growing the network in meaningful ways and them directly deriving no revenue from that. Imagine if the dollar the dollar could be held by dozens or hundreds of banks, but there was only one company that was earning all the interest from those dollars that were held in everybody else's banks. It would be a preposterous notion.
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Yeah. Likewise. Excited to have a conversation.
So this is a big stablecoins conversation, that came out of a conversation that I had at a bar with Nathan in Singapore where he, kind of one 80 ed my views on what I think the stablecoin landscape will look like. So a lot of my predictions and me trying to my pithy thoughts and trying to sound smart, they oftentimes just come from, Nathan and I just steal his ideas. So I just wanted to, bring him onto the stage. But maybe, actually, Chad
in time. We have something in time.
Yeah. Exactly. I would love for, actually, both of you guys because, maybe Anchorage and Paxos people, some of the listeners don't know as much about. I would love for you guys to explain the business models of both of your businesses. I think people know what you guys do. Paxos, you help with stable coins. Anchorage, maybe you do custody. But what are the business models of both of your businesses? Sure
thing. I can I can start? So Anchorage is a digital asset platform. Our biggest product and our main source of revenue right now comes from custody fees. The way that works is we, have institutional investors hold their assets with us, and, we charge what's called basis points on custody, assets under custody. So they hold, say, a 1,000,000,000 in assets with us, and then there's some rates they pay annually based on that. This is not new to crypto. This is how the traditional, financial cost custodians like BNY Mellon, State Street, Northern Trust, charge. Into this in addition to that, we ha
And so our business model is a little bit different, but in some sense, maybe similar. We have 2, 2 facets in the business. 1 is in the infrastructure part of the business or the utility side of the business where we enable firms to be able to offer crypto products to their customers. And so example that might be, you know, PayPal being able to offer, buy, sell, hold. So it's called crypto brokerage. Or it might be Stripe being able to enable, payments in crypto and stable coin, specifically stable coin for their customers. And so we're providing, like, a wallet and, and sometimes a custodial
Chad, I'd love to get your take on just the the stable coin landscape right now. It feels like in everybody's 2025 predictions, it's like this is the year of stable coins. You've been at this game longer than most. What is the, like, stable coin landscape as you as you see it today? Yeah.
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