Welcome to season 3 of the Public Key podcast! New Season, New Hosts, New Look. The US has been viewed as having a regulation by enforcement policy, but now they are focusing on becoming the leader of blockchain and stablecoin legislation. In this episode, Eitan Danon (Content Marketing Manager Chainalysis) covers a lot of crypto regulatory ground speaking with George Georgiades (General Counsel, Borderless.xyz) as they talk stablecoins, regulation and US digital asset policymaking.
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Public Key Episode 153: Navigating the Crypto Maze: SEC, ICOs, and Blockchain Regulation Insights
The US has been viewed as having a regulation by enforcement policy, but now they are focusing on becoming the leader of blockchain and stablecoin legislation.
In this episode, Eitan Danon (Content Marketing Manager Chainalysis) covers a lot of crypto regulatory ground, speaking with George Georgiades (General Counsel, Borderless.xyz) as they talk stablecoins, regulation and US digital asset policymaking.
George provides insights on the intrinsic value blockchain technology brings to the financial sector, specifically with stablecoins, highlighting their impact on global payment systems and the groundbreaking potential they hold for the future of finance.
He also provides an astute analysis of the evolving regulatory environment surrounding digital assets, emphasizing the need for clarity in legislation to foster innovation, while reflecting on the early days of blockchain exploration.
Quote of the episode
” I think that the SEC and the staff have done significant amount of research and analysis over the last couple of years and now there’s a new momentum to engage with industry stakeholders to begin to move away from just enforcement to discuss how do we create guidance.” – George Georgiades (General Counsel, Borderless.xyz)
Minute-by-minute episode breakdown
2 | George’s journey working with traditional securities and entrance into crypto
4 | ICO’s, tokenized assets and balancing innovation and regulation
6 | How US Regulators could lead the world in crypto legislation
9 | The biggest lawsuits filed by the SEC including Coinbase and NFT Marketplaces
10 | [UPDATED] George summarizes recent lawsuits settled against crypto frims
12 | Borderless Labs and their mission to revolutionize global payments with stablecoins
17 |The future of stablecoin regulation and adoption
22 | Managing transactions speed and on-chain data in the modern world of payments
25 | Regulating celebrity endorsements and consumer protection in NFTs and memecoins
29 | Biggest predictions and breakthroughs in the digital asset industry in the USA
Related resources
Check out more resources provided by Chainalysis that perfectly complement this episode of the Public Key.
- Website: Borderless Labs: Empowering banking between traditional & emerging markets
- Website: Borderless.xyz: Global rails powering stablecoin money movement companies
- Article: Securities implications on “Hawk Tuah Girl” memecoin $HAWK
- Interview: Preparing for a stablecoin regulatory push in 2025 with George Georgiades, General Counsel at Borderless.xyz
- Report: The Chainalysis 2025 Crypto Crime Report (Download Your Copy Today)
- Conference: Chainalysis Links NYC (April 1 & 2, 2025) ** Get Tickets Now !!!
- Blog: Chainalysis Provides Automatic Token Support on Solana
- YouTube: Chainalysis YouTube page
- Twitter: Chainalysis Twitter: Building trust in blockchain
- Telegram: Chainalysis on Telegram
Mentioned Episodes
Ep. 132: How Tether is Building Resilient and Decentralized Financial Systems
When we think about the crypto company that has cracked the real world adoption problem and given access to people internationally who want access to the US dollar and foreign currency, we have to describe Tether as being that company. In this episode we talk to the CEO of Tether and CTO of Bitfinex, Paolo Ardoino about what the future of decentralization looks like for finance, communication and the exchange of value.
Speakers on today’s episode
- Eitan Danon *Host* (Content Marketing Manager Chainalysis)
- George Georgiades (General Counsel, Borderless.xyz)
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Transcripts
Eitan
Welcome to another episode of public key. I’m your host. Eitan Danon, I’m joined today by George Georgiades, General Counsel at borderless labs. Welcome to the pod, George.
George
Thank you very much. Thank you for inviting me.
Eitan
Really looking forward to our conversation. So let’s jump right in. You spent the early parts of your career in securities, and you were you were advising fintechs, early stage companies. What drew you to this niche in your legal career?
George
My career started on Wall Street, working at a corporate finance firm, a leading firm here in New York, an investment bank, a hedge fund. So I’ve done my my rotation amongst different regulated entities representing companies from the New York Stock Exchange to startups. I’ve always found a passion for helping new ventures and mission driven companies that are looking to to leverage technology to change the world. Around 2016 I first got engaged with Blockchain technology at the time, there were a lot of ICOs, which we were advising against and shepherding companies to work with regulators and understand how this new tokenized asset class can fall into our regulatory regime. And that was my first understanding of blockchain, tokenizing assets, and realized that this is an incredible technology. This is a global, immutable ledger. It’s transparent, and this was going to have a fundamental shift in how a lot of legacy technology was working at the time to move on to this, this new tech, and that’s where I began my my career, learning about the technology and understanding how it can fall into the regulated infrastructure. Awesome. Well, the ICO craze of 2017, definitely a momentous juncture at which to join the crypto ecosystem. There have been a lot of recent developments around digital assets, especially visa, vie securities. You look at the SEC interactions with ripple, Coinbase, others,
Eitan
a question for you about your earlier days, kind of, when you first discovered blockchain and crypto, what were some of your thoughts as you began to dive more deeply into crypto? And you know, is it a security? Is it a commodity? Is it both? Is it neither? What is this thing? So how do you kind of, how did you approach the debate?
George
Yeah, I think in the early days, we generally advise companies not to, not to rush into ICOs or raising capital through tokenizing, tokenized offerings, understanding that the form doesn’t necessarily change the substance. We have a very much principles based regulatory infrastructure when it comes to determining whether something is a security or as the term is used investment contract, with a lot of different case law as well as statutes that evolved over the last 100 years or so, and tokenized assets and leveraging the blockchain creates some novel legal issues that needed to be resolved. And at the time, we were beginning to engage with the SEC and other regulatory agencies to better understand how they view this new way of raising capital and how this falls into our existing infrastructure. So generally, at the time, we would caution companies to to wait and see until some of these anomalies were were resolved. Over the last couple of years, we’ve seen regulators take an aggressive enforcement or regulation by enforcement process, which was not helpful in resolving those issues. Last couple of weeks, we’ve seen regulators and legislators re engage on the topic with the crypto task force being created. I think that the SEC and the staff have done significant amount of research and analysis over the last couple of years, and now there’s a new momentum to engage with industry stakeholders, to begin to move away from just enforcement to discuss, how do we create guidance? How do we create a framework to resolve some of these issues and to allow the market to participate in this new technology, new way of raising capital in a compliant way that balances both our history of registration, transparency and orderly market, but also consumer protection and innovation absolutely on the you mentioned, wait and see on that front. So so far this year, some of our guests have included Leslie chapkin from Paxos, former cyber advisor at the White House, Carol house. We are now three ish weeks into the new administration. Hard to believe, but given this transition moment, policy wise, you know, in this first couple of months of the new administration, what are some of the key takeaways that you think our listeners should be following in the US, and then what are some of, what are some of the global reverberations or implications that you think on the policy and regulatory front folks should be paying attention to I think, over the last few years, we’ve seen modern jurisdictions abroad, advanced frameworks and legislation, while we, or the last administration, took an approach of more regulation by enforcement. We have the debates about the banking and operation choke points being discussed now, but that’s all in the past. In the last couple of weeks, we’ve seen a renewed interest by regulators and kind of tone from the top that it’s important for the United States to lead in the development of blockchain technology and the various uses that the blockchain can have across many different verticals. Right now, we see renewed interest from a crypto task force to open. Calls for rule making comments, and now’s the time for industry stakeholders to make their voice known. There’s interest from Congress to regulators to fashion regulations. I think first we’re going to see stable coin regulation here in the US, we’ve seen robust regulation launched earlier this year and last year in the European Union and Mika and other other European directives, as well as well as in other jurisdictions, from Japan to Singapore to the United Arab Emirates. So now it’s our turn to put in place a framework that will hopefully balance all interests and create something that can foster innovation, but it needs to be done responsibly,
Eitan
totally. It sounds like, if I’m hearing you right, current dynamics, will you anticipate them being advantageous, not only for fintechs writ large, but forall kinds of digital assets companies, digital banks, crypto companies, etc. Are there any setbacks or challenges you think people are not paying attention to? We hear a lot about tailwinds and momentum, a lot of which is is rooted in truth, but some of that you know, can can border on the euphoric at times. Can you break it down for listeners and give them maybe more of a clear eyed treatment or assessment of where you think things stand?
George
Sure, I think over the you know, one of the misconceptions I’ve written about is that the industry has never advocated for deregulation or for no regulation. It’s quite the opposite. The industry has phenomenal professionals out of government, out of law firms, from technology across the board, who have advocated over the last couple of years that we need clarity, not necessarily less rules or more rules, but just a clear set of guidelines that everyone understands. These are the rules of the road in launching their business, from wallet technology to raising capital to custody. I think now that there is an interest by regulators in Congress to work together, it’s the time for the industry to have those views shared and to work collaboratively on what it will look like. I don’t think the industry is going to necessarily get the extent of what they want. I think there is going to be significant amount of guardrails and Consumer Protection protocols put in place, which is fair for any new technology coming to market. We’re going to see it starting with stablecoin legislation, which already we have draft bills being debated and open call for comments. I think there’s significant amount of consideration to be done with compliance, from the Bank Secrecy Act to how we’re going to treat unhosted wallets. Now, I’m huge advocate that the sovereign right to have on hosted wallets and your right to protect your assets, but that doesn’t mean it should be done at the cost of the real risk of funding terrorism, financial, crime and others. So we need to ensure that there’s a layer of compliance that’s embedded to make sure that it’s all done within a compliant ecosystem. So I think we’re gonna see stable coins, we’re going to see on hosted wallets. You’re going to see more clarity on staking, which is, I think, quite low hanging fruit, to clarify what the position is, from the SEC to the CFTC. On how that’s treated, we’ve seen a number of civil suits filed, which I think will be clarified over the next couple of weeks, ranging from the famous celebrity meme coins. How are meme coins going to be treated? Are they securities? Are they collectibles? And if they’re collectibles, what are the rules of launching those and to create a fair and open marketplace?
Eitan
So you lead me into my next question. One of the you wear many hats, and one of those hats is your legal hat, and certainly in the GC role on a lot of philosophical and also practical issues, we’ve gotten clarity sometimes in the courtroom, the recent judgment on tornado cash, one example of that. Are there any specific court proceedings that you’re keeping your eye on that you think listeners who kind of you know are more policy minded or care about some of those regulatory dynamics should should also keep their eyes out for
George
I think is a big one coming this spring on how we’re going to regulate technology as itself. Is it going to fall within our money transmitter or other regulatory framework, or will it be excluded? And that’s one big topic that needs clarification, which balances a couple of topics, which is innovation, what is it simply creating tech protocols versus whether you need to be a money transmitter, regulated subject to compliance and other regulatory requirements. I think we’re going to see some movement on cases against some of these exchanges and whether or not they’re acting as unregistered broker dealers. Are these digital assets actually securities? Whether it’s the appeal and ripple case against Coinbase, among other smaller actions, we have actions against NFT platforms where, again, it raises the question, were these digital assets actually security subject to registration requirements? But what we’ve seen over the last couple of years was, again, a policy of regulation by enforcement. My feeling is that a lot of these actions may not proceed while there’s a pause for the crypto Task Force and others to engage to provide clear rules. So I think these cases are significant. I think that they were, they were rooted in a lot of ambiguity, and hopefully, given the tone from the top currently, there’ll be a pause in enforcement action while we focus on providing clear rules and regulations and allow people to either come into the fold of how they should be.Related or be exempt in other types of models.
Eitan
That makes sense. I think, lots to track. You know, in the immediate and midterms, I want to, I want to pivot now to borderless specifically. So last year, you joined borderless Labs, which, for those who are unfamiliar, creates infrastructure to bring banking and payments on chain. You know, in our research, certainly, and just studying the ecosystem, there are a lot of entities and companies, you know, crypto and foreign exchange payment apps in the market. It would be great for our listeners to learn a little bit about what differentiates borderless labs, specifically
George
sure stable coins and blockchain technology are changing how value is transferred globally, specifically stable coins, and I think there’s now a realization of the immense opportunity the United States has, and kind of dollarizing the blockchain in creating stable coins, and allowing stable coins to become both a infrastructure, way of moving assets and a store of value borderless. Created the first global network for for payments. If you look at the world today, if you want to make payments or move value globally amongst different financial institutions from on and off ramping it’s very much a fragmented market across multiple jurisdictions, but through the borderless network we created, we took a fragmented market and unified it under a single set of APIs, a single access point, a single network, so anyone looking to transfer value make payments across the world, can now do so seamlessly just by accessing the borderless network, and we work exclusively with regulated financial institutions close across the world, which makes compliance, regulatory compliance and custody a priority.
Eitan
Yeah. I mean, I think in tradfi, like looking at Zelle and Venmo and some other payment rails and apps,the interoperability allure of interoperability certainly is there. And we break our teeth sometimes trying to send value or information. So the use case is very compelling. I wanted to ask specifically on the jurisdictional front, could you walk our listeners through how it works if you’re sending funds on chain from a jurisdiction that is heavily regulated to one that perhaps hasn’t implemented crypto regulation or maybe has more of an ambivalent or ambiguous posture. How do you see that operating across different countries?
George
That’s a great question. And the way we solve for that is we only work with regulated entities that we diligence in each jurisdiction to ensure that both the on ramping, whether it’s in the US or abroad, is done through a regulated financial institution which is licensed and subject to the relevant compliance requirements in those jurisdictions, and the off ramping, if you want to off ramp, you can certainly keep your stable coins or other digital assets in your your own wallet, are done again through regulated entities in those jurisdictions and by tying regulate entities together, we ensure that there’s oversight compliance and there’s integrity to the network.
Eitan
Great, can you? Could you provide a case not to pry, but sure you know a few of the more popular use cases you’re seeing borderless encounter, or any emerging use cases across the EU, the US, other kind of big markets that you touched on a few moments ago.
George
Sure, there’s, there’s a number of different use cases, and that’s what I love about doing. What we do is engaging with innovators and different market participants on how they want to use technology and how we solve problems. You know, today’s legacy market is expensive, it’s slow, there’s risks funds get lost through the blockchain. It’s a transparent ledger. Through the borderless network, we solve a lot of the fragment issues, both in those financial institutions, but also in various blockchains, tying things together to ensure a seamless process. We have customers that are using the network to make payments to workers in a number of different jurisdictions. If you have to make payments of 1000s of workers in dozens of different jurisdictions around the world. It’s expensive, time consuming. It requires the payor to have either a float or use different intermediaries. From the technology side, you have to diligence integrate a number of different parties, but through the borderless network, you have seamless access to I think we’re over 60 countries right now, in 20 different currencies on a number of different blockchains. We’re agnostic to blockchains and stable coins. We have not only for pay, we’re sending funds out, but also remittance. We’re working with a large global platform that has a subscription model, and they have subscribers across the world. And how do you remit those funds back? You can’t necessarily have 1000s of small monthly checks or wires or ACH or other forms of payments coming back, but by using the borderless network, you’re able to aggregate those funds and to use the blockchain for an almost instantaneous settlement, again, through regulated financial institutions, which is cost effective, it’s efficient and it’s transparent.
Eitan
That’s awesome. I think, you know, the remittance and payments use cases, especially in developing countries, where there’s not always robust digital infrastructure, or maybe it’s in development, that’s really compelling. But even with, you know, kind of looking at some some countries or areas where blockchain crypto in particular, and blockchain tech writ large, are spur. Setting, some are still running into the problem of not being able to bank the underbanked or the unbanked altogether. What do you think are some of the main hurdles in making sure we have a more accessible,no pressure, by the way, a more accessible financial industry? Do you think? Do you think that bringing it on chain helps and kind of, how do you spell that out for folks?
George
I think we’re going to see a lot of developing countries skip a few generations of technology development and evolution with the tech that’s available today right now, with the use of blockchain as a as a ledger, stable coins and other digital assets as a way of transferring values and holding values. Stable coins is a way of holding us dollars, and this is a huge advantage to a lot of jurisdictions where they have variations in their currencies, fluctuations, risk of inflation. They may not trust their local banking vendors. The ability to hold us dollars in your wallet. Now we’re seeing the ability to access the internet through Starlink and other other ways, which is skipping the generations of fiber optics and cables and infrastructure that more modern economies have gone through, which is now providing folks that may not have access to a local bank resources to hold hold value, pay and get paid globally. Is there a mobile app kind of component to that conversation. I think in a lot of these markets and economies, you certainly see with the explosion of mobile telephony and lots of digital assets providers that have an app, you’re opening the floodgates, I think, and perhaps skipping some of those steps. Do you am I hearing you right? We’re seeing a number of financial institutions now really focus on being online, mobile apps, regulated custody, without having to do your traditional bank bricks and mortars. We’ve seen also in the United States the evolution of Neo banks over the last two decades or so, and we’re seeing this globally as portal is as a network, as an infrastructure provider. We have a number of these apps and intermediaries that are plugging into the network to be able to access financial institutions globally, to move funds, pay or receive funds, whether through stable coins or off ramping into a number of different currencies globally through our APIs, it’s easy to plug in as an infrastructure solution, and that accelerates growth and access to the market.
Eitan
Excellent. Well, I want to move back to stable coins. You’ve talked about the topic several times now, and we’ve put out a lot of content that kind of incorporates their importance in the ecosystem, explaining how they work, how providers engage different parts of the ecosystem as well. The subject is extremely popular with our partners, also with, with listeners of the pod. You know, recently you had stripes, acquisition of Bridge, bvnk, raising another 50 million round. What is your take on the landscape, the stable coin landscape? How do you, how do you kind of look at, look at things, not only in the US, but globally. You mentioned some other financial centers very early in this conversation. Do you see it more as a race, kind of the crypto version of the AI space race, or do you see it as more of a integrated and collaborative effort, where adoption and regulation begets more regulation? How do you kind of approach this topic?
George
I think there’s a realization globally of the benefits of stable coins, I would say it’s the first real use case of the blockchain. Real world use case. It solves a lot of issues globally, in terms of women’s movement of capital. It solves it modernizes banking infrastructure that we’ve used for decades. In leaps and bounds. We’re seeing it solve real problems for people who want to hold their assets, move assets on chain, as opposed to traditional banking networks, or the modern evolution of banks to be both an on chain, regulated product. The growth and the adoption of stable coins at this point is beyond if or when, as we’re talking for many years, to is happening globally, whether, whether it can’t be stopped. That’s why we have a lot of new regulations coming out, which I think will foster additional growth and adoption. I think it’s a market. It’s really a winner take most. I think we’re only going to see a handful of stable coins and different denominations. And when I talk about stable coins, I just want to make clear I’m talking about currency backed, stable coins that are one to one backed. I know there’s other flavors of stable not algorithmically backed, or commodity backed exactly. I don’t consider those and in payment stable. You’re not talking about the petro in Venezuela, for example. No, not at all. We’re talking about the US, dollar, euro or other currency denominations backing these, these assets. I think with additional regulation, we’re going to see greater adoption and greater use, not only amongst people for settlement of transactions, but we’re going to see this amongst financial institutions, settling trades, settling transactions globally, between financial institutions, as opposed to just retail users. We had infrastructure product Excellent.
Eitan
I was going to flag for our listeners. Our previous host, Ian Andrews, interviewed Paolo ardini, the CEO of tether, and it’s a great conversation. So if you haven’t heard it, check it out. Give it a listen. One of our recent guests, I believe it was Leslie chavkin of Paxos, discussed the possibility of there being a federal regulator in the US for stable coins. The use cases are real as you’ve enumerated, and they are compelling. What are your thoughts on something like that, a specific regulator or authority dedicated to stable coins, their use, their implementation, kind of macro issues? How do you how do you take that recommendation? I
George
I think that’s one of the big topics we’re discussing now, and that’s why it’s important for the industry to engage with regulation, regulators and lawmakers as we begin to evaluate what is, what is the US framework for stable coins, we’ve seen what other jurisdictions have done, whether it’s in Mika, whether it’s European Union or others. How are we going to approach this? And honestly, it’s not new to us. We’ve built one of the largest capital markets in the world, one of the most efficient markets. So this is, this is our opportunity to take our approach to how we want to regulate this very unique and very important, I think, systemic product across the across the United States, and it’s going to be taken globally. My view is that the recent bill that was promoted genius shows a a dual regulator, whether it’s state and federal depending on the assets under under custody backing the stable coin, which is an interesting approach. Whether we need another federal regulator, I think needs to be better defined on, why do we need another federal regulator? Why can it do within the current regulatory infrastructure that we have, as opposed to a single, required, regular stable
Eitan
coins are another
George
stable coins, another czar, another threat. I’m not completely convinced that that’s going to necessarily help, and generally I caution against this idea of if we need regulation, we just need more regulation, or we need more departments, or we need more laws and rules. I think we need to look at our current infrastructure and our current regulatory structure, which is one of the largest capital markets, financial markets in the world, and to see where there’s an add on that can be done, or clarification of the rules, as opposed to necessarily going back to square one and recreating something new. So I am interested to see more about what these proposals would look like, and why a new right, why new federal agency would be required for this, as opposed to including it into our
Eitan
other so looking at the body of how existing law would apply, and then for the truly unprecedented cases where existing regulation or case law, you know, cannot shed light, maybe then there’s a need to, you know, there’s a couple of elements
George
that do need to be clarified. You know, a very strong advocate of ensuring that any, any stable coin regulation, or any stable coin body for for oversight, ensures that one, it’s, we’re talking about payment tokens. We’re talking about fully reserved, fully backed, one to one, that these are audited, there’s transparency, that there’s there’s segregation of assets, to me, that’s one of the most key, key aspects of any stable coin infrastructure and body that to ensure that if the administrator issue were were to find themselves in financial trouble or to go bankrupt, that those assets are fully segregated, that they are invested in avoiding quality liquid exactly because if we don’t allow that, it’s a going to cause concern about, yes, you have this digital asset, but is it truly backed? Is it truly liquid? Can it be redeemed right away, and is there liquidity in where it’s held? And that doubt is, I think, going to create some concern. And the current proposals that are moving through Congress and being debated seem to address those issues, and that’s what we’re very, very hopeful for.
Eitan
Great. Well, back to borderless for a second. So as you kind of discussed earlier, border list is all about building payments and financial infrastructure on chain. Now there is concern that about the ability to scale blockchains.You know, public, private and otherwise, kind of hybrid chains, just in general, blockchains with a capital B, where massive amounts of data are stored on chain. As the use cases for blockchain continue to grow, how does borderless plan to navigate this issue? Do you see it as a bottleneck? Do you see it actually as a blessing in disguise?
George
That’s a great question. You know, for the borderless network, we use the blockchain for transactions, so we don’t actually store data on the blockchain. And the issues we’ve had over the last couple of years, which have evolved with new technology, with new blockchain, is transaction speed. Now we see new blockchains ranging from base to Solana to sui that are that provide for greater transaction speed and execution, which is allowing for greater use cases in the market.
Eitan
Great, are your if I can ask, Are your developers using AI at all and creating kind of the protocol that bridges the gap between tradfi and crypto, or like an on Ra On and Off? Ramping? How? If at all, are your team leveraging AI? It’s a question that anyone and everyone has to be ready to answer, increasingly, on a daily basis.
George
I love the evolution and rapid evolution of AI, and especially how it’s affecting smaller, new startups, not just for scammers, also for borderless and legitimate players. Indeed, indeed, it’s changing how people do business on a day to day, and how companies are built. But for for us, when it comes to the development, all our engineers and product managers are all in house. We don’t leverage AI for what we do. We’re very sensitive to where we where we publish our code, but they don’t use AI for that. But certainly exploring AI and other sides of the business on how it can create efficiencies.
Speaker 1
Great.
Eitan
Great. What is the looking a little bit at the state level initiatives? What is the view from borderless on how solutions like fed now in the US, or like even looking to the People’s Republic of China, right, the ecny, the digital Yuan? How do you see those playing into this discussion? We talk a lot about Fiat backed stable coins, and specifically dollar pegged ones, tend to take up a lot of oxygen.How do you see other initiatives to for payments and settlement kind of figuring into the conversation?
George
There is a combination of using tradfi and defi as on and off, ramping for moving money. I think what we’re seeing and what it underscores is that a lot of our infrastructure that we’ve relied on for decades is now outdated. I am, personally a huge advocate that the that on chain is the solution to much of these bottlenecks and much of these cost centers. And what we’re going to be seeing, and started seeing is a lot of major financial institutions here on Wall Street, banks beginning to create their own programs and invest in blockchain technology to create a more efficient, more effective way of moving, transferring value globally, instantaneously, in a transparent manner that the blockchain offers. And that’s really what we’re seeing when folks come to the borderless network to leverage the blockchain for global payments, not looking to other banking initiatives, whether it’s fed now and others. We’re seeing the European Union. We’re seeing instant payments globally. It’s still leveraging a legacy infrastructure, and more importantly, it’s still siloed with Blockchain transactions and leveraging US dollar or other currency backed stable coins. It allows you to instantaneously move assets, to settle transactions, to do a number of different things, whether it’s payments, repatriation of funds globally, instantaneously, without having to go through the siloed infrastructure. And that’s one of the problems that borderless solves. We look at the dance between tradfi is on ramping and off ramping and blockchain as the mechanism of moving, transferring value globally. How do you move seamlessly between the two worlds and through the borderless network? You can do that through a network of regulated financial institutions, and is also making sure that there’s an integrity side to it, that who you’re working with, and that it’s all done within a compliant wrapper.
Eitan
Excellent. Well, you wrote an article, or you contributed to an article, I think that highlighted that the industry needs guardrails to protect against celebrity endorsement of nfts. Think you talked about recent situations with milk boys, Logan Paul Hawk to a girl. Do you think the authorities have done or are doing a good enough job of making examples of these kind of influencer cases. Do you think more attention? Where does more attention need to be paid? And could you share some of your thoughts on this issue?
George
I would say they haven’t. And that comes down to the last several years, a policy of regulation by enforcement, where some of these meme coins, some of these offerings, some of these programs that celebrities are are intentionally, even unintentionally, getting involved with to leverage their their mass followings raise certain complicated legal questions as to whether or not these tokens, these meme coins, are a security and investment contract which needs to be registered and only sold to certain investors or credit investors with us, a lot of limitations and disclosure requirements that go along with it are these collectibles. They’re, of course, nevertheless subject to different state regulatory bodies for anti fraud and disclosure requirements and not having the clear rule book come from the top on how these assets are regulated, how these programs and markets where they’re sold are regulated, I think created a gap where we see a lot of regulatory enforcement, while there’s other arguments on the other side, which are the rules have not been clear and not providing. I think a clear rule book has allowed for some of these to continue in the market without clear guidance and without a clear you should know better, or this is how you should have acted. I think from the regulatory side, the wheels of justice move slowly, so I do expect to see a lot more enforcement actions possibly in the future on this topic. But certainly, what moves much faster than regulators are civil litigators and class action lawyers. And we’re starting to see more class action civil litigation pop up on this topic.
Eitan
Yes, the issue will come to a head. One way or another will come to a head. Yeah,
George
I think that’s one of the big topics that needs to be addressed by the crypto Task Force, which is, how do we regulate these non or what would fall within a security token that needs to be regulated and from Congress’s point of view, well, if it’s not a security what body of law does it fall under? How do we create an orderly, regulated market for the sale of these different collectibles that we call them, that that we’ve seen in the past to ensure they’re done in a transparent and orderly manner to protect consumers, so we don’t see more of these, these rug pools and these, you know, manipulative, alleged, allegedly same practices, which, right, hard to generalize, but there is that, you know what my concern is that we need to make sure that we have this new opportunity, this new chapter, after a couple of years of of hiatus from from development and from growth. And we need to make sure that this time around, that we that we remember the the problems of the past, the issues, the very real fraud that happened in our our industry, as happens in most and how do we make sure that we solve for those problems, that we’re able to identify and eliminate these bad actors from the ecosystem, and most importantly, that we protect consumers and consumers confidence in our industry, stable coins and the use of digital assets for payments. And that is, I would consider it quite separately. And I think when you look at the industry, you should look at it from a point of security, tokenized assets, real world assets. We have the collectible industry, which has always existed, and then we have the payments industry, like stable coins, right? Different fiefdoms, different different worlds, that, in some cases, are colliding, to quote Seinfeld, but they’re colliding with regulations that were passed in many cases over 100 years ago. Right? I thought I could make it a whole episode of public key without saying Howey Test, but there we go. So I want to the famous Howey Test. Yeah, there. There it is. I actually have made it several episodes without saying that. So you mentioned the tradfi defy kind of connection, and if I may, you were recently at the fifth annual defi retreat in San Francisco.
Eitan
Lots of other top industry professionals were there. I understand the talks were under Chatham House rules. So you know, not trying to probe here. But are there any interesting topics at a high level that professionals were discussing? Or, yeah, for those who are kind of more interested on this, Oh, you missed it.
George
Scheduled to go. I was so excited to go, and unfortunately, had to have to skip to the event for some things happening at borderless, some deals that we were closing. So being a good general counsel, I wasn’t able to attend and stayed, stayed back at the office to close a few deals, but Alex and the financial club do a phenomenal job. They had, I saw they had a phenomenal group of speakers and topics there.
Speaker 1
Yeah,
Eitan
Yeah, it looked great. Well, with everything going on, you know, we talked a little bit about AI, about defi. You’ve talked about staking a couple times. What do you think putting on your prediction hat right now? What do you think is going to be the biggest breakthrough for digital assets in the US and abroad in the next one to two years? Do you see it firmly in the stable coin domain you know? Is it Bitcoin? Is it something that you know you think will will relate more to, like crypto as a reserve asset. How do you see this playing out in terms of real world use cases, either at the retail level, institutionally, governments? You know, the kind of ongoing great power competition that we see define the international system. What’s your what’s your prediction for cryptos? Greatest, greatest contribution to humanity?
George
The small, small questions, small questions, small no pressure, no pressure at all. This won’t, won’t be, won’t air for we repeat it for many years. I would say for, for, my view, is that both on the retail, institutional side, it’s going to be stable coins. And how stable coins are going to, I think, two fold change how institutions interact with each other to settle transactions and hold assets, leveraging the blockchain and on the retail side, both how people settle trades get paid, but also the human behavior around it, I think will change on how we can now instantaneously pay, get paid, or move assets globally. I think that it’s going to create a new generation of financial inclusion, and along with that, it’s going to be very interesting to see how the human interaction change and what innovation comes from that level of financial inclusion. We already see a lot of innovation in this space. You know, we have a diverse group of innovators, along with institutions that come to borderless to leverage the network to be able to move stable coins, pay, sell transactions globally, using our network, and seeing what these new innovators are building, it’s very hopeful for what the future is going to look like and the next, even in the short term, the next one or two years on, on what that looks like, I would say definitely going to be stable coins.
Eitan
Excellent. Well, what? A few other questions on borderless looking ahead to the year ahead, what is on your roadmap? What kind of features, service offerings, are there, integrations, or kind of other projects that the team have cooking where you would call listeners attention to what’s what’s kind of on the roadmap for your team?
George
Sure, the team is hard at work, developing the network, expanding the network, both in depth and breadth, which is adding more what we call pfis, partner financial institutions in each jurisdiction. So you not only get access to a currency country jurisdiction, but you also now have multiple financial institutions that are operating in that jurisdiction, which creates redundancy and competition on price that will allow us to continue to expand globally and provide our our integrators with options. Second we we see this. We see this expanding payments. And really, I would say we’re going to be guided by our by our integrators, our innovators, on what that looks like our overall thesis is that payments and banking ultimately moves on chain, whether it’s directly by individuals or it’s through financial institutions, not if Jamie diamond has anything to say, well, he might be, I know I feel his opinion changes every couple. Yeah, slightly less hostile than Buffett indeed. But JP Morgan has an impressive blockchain department, absolutely, absolutely, very talented individuals that are working there and developing their own their infrastructure around that. So I think along with that is we’re going to see on chain banking mimic what we’re used to in traditional banking, which is going to include yield bearing products, which is an interesting development, as we see stable coins evolve, the ability to get paid for interest for having your stable coins deposit, and we’re going to see the the modern banking basically built on chain.
Eitan
Great. Well, thank you for the illuminating conversation for our listeners who are interested chatting more with George, what is the best way for them to link up with you and connect either on social or other ways? Great,
George
great question. It’s great to go to our website at borderless dot XYZ. You’ll see all our details there to access or catch me anytime on Twitter at GG Esq,
Eitan
excellent. Thanks again, George, great to have you on the pod. Thank
George
you so much pleasure speaking with you. Applause.