Remy Blaire: Well, regional banks are making their presence known at Money20/20. Unlike their larger counterparts, these institutions are actively exploring moving on-chain and launching innovation banking. Meanwhile, a new report from First Citizens Innovation Banking finds that US fintech is projected to see 42% more capital flow this year compared to the previous year, and this puts 2026 on track for the strongest total venture investment in fintech since 2022.
Well, joining us live on the ground here in Vegas is Anthony Vassallo, director of crypto for the First Citizens Innovation Banking team. Anthony, great to have you back on the show. Thank you so much for joining me.
Anthony Vassallo: [Unclear: “See you around.”]
Remy Blaire: Well, what a year it’s been, and what an event we’re seeing on the ground here in Las Vegas. But when it comes to institutional adoption, what are we seeing right now as we head into the new year?
Anthony Vassallo: If you think about what the institutions are trying to do, they’re just using better database technology. And so, how can they reduce friction, move value, help their clients not incur as many fees, reduce latency and settlement times, things like that? So far, you’re seeing a lot of announcements around payments, of course, anything around ledgers and tokenized deposits, either inside the perimeter or among a consortium of banks, and also just making it easier for their clients to come in and out of stablecoins and take advantage of cross-border remittance, liquidity, and distribution. And ironically, while that’s the start, and that’s the more natural extension of what they do, you can do this with other digital assets too. So I think we’ll see more along the lines of some of the large-cap tokens in the not-so-distant future.
Remy Blaire: Yeah. And Anthony, you mentioned a key word that we’ve been hearing across the floor here at Money20/20, and that is stablecoins. So when we think about the utility of stablecoins, do you see utility moving beyond payments?
Anthony Vassallo: Definitely. So we see our clients use it in their enterprise plumbing, as part of their treasury strategy, to collect revenue, to pay offshore developers. But I think one thing that is important, and that is not discussed as much, is what happens in the first and last mile. The ramp is really important. If you think about a stablecoin balance as perhaps an extension of a checking account balance, you don’t want to keep all your dry powder there necessarily, or keep it forever. And you cannot pay the IRS in USDC.
So yes, there’s more that you can do, especially in terms of earning yields and putting stablecoins to work in a way that you might not be able to with cash. A lot of these are just wrappers and nomenclature. So a lot of the same can apply to tokenizing other assets, [unclear: “titling, dating”], and things like that. But so far, everything is payments, and I think we’ll start to see more come from there. The VCs are going into things beyond payments, but the actual transaction volume is still focused around that.
Remy Blaire: And of course, we can’t have this conversation without talking about artificial intelligence. So we’ve been hearing a lot about agentic AI and agentic commerce. And you’ve previously said that there’s the question of whether crypto needs AI more than AI needs crypto. But what’s the reality right now?
Anthony Vassallo: It’s a good question. So if we think about the capitalization as well, the data shows it, and people are correct when they say the AI trade has taken capital from other things. But as you opened the segment, there’s still a lot of healthy capital going into fintech, and within that, payments and stablecoins as well. So coming off of the valuation overhang of 2022, but seeing more discipline from investors, to have that same level of investment now, I think, is definitely promising.
And in terms of that idea, it’s a rhetorical question that I never plan to actually answer. The question is, do you believe there will be a native currency, or a basket of native currencies, on the internet? Do you believe in a future of machines and machine payments, and how will they transact value? So I think these technologies really need each other and complete each other in a way.
Remy Blaire: Yeah. And of course, while I have you here, I do want to get your perspective when it comes to venture-backed Web3 as well as crypto startups. So what is happening in the current environment, and given the overall macro backdrop?
Anthony Vassallo: Yeah. So we’re still seeing our clients build and stick to their roadmaps, even in light of the failure of market structure. GENIUS will go into effect in January. In terms of raising, it’s much easier if you have some sort of a reference to AI or stablecoins in your deck. But we are finding that a lot of our clients are being more resourceful and doing more with less, and being really prudent about their burn. It is difficult to raise as a founder in a vertical within crypto that isn’t doing something expressly around payments or crypto, but I think that will change. And we’re also seeing emerging manager VC funds deploy specifically around things like Bitcoin infrastructure, layer twos, things like that.
But there is also a bit of a gap right now between being able to raise at the early stage and then as you scale. There’s a bit of an opening if VCs want to form more of a growth equity fund, at least one dedicated to digital assets, and the classic growth equity investors will get involved. And I think we’re still so early, and we lose sight of that because we’ve come so far. But there also aren’t really standards around private equity in crypto as well. That’s just being handled by the corp dev teams of some of the largest crypto companies.
Remy Blaire: And before we move on, why do you think we’re seeing this in the current environment?
Anthony Vassallo: I think that it’s easier to understand how we can move something that doesn’t potentially have volatility, right? It’s easier to prove this to an investment committee. And also, working backwards, all the M&A with everything starting with a B has been around stablecoin technology. And token prices take effect as well. However, like we talked about last time, we’re seeing an uptick in, and a maturation of, Bitcoin lending, and more ways to help users and enterprises procure the asset and custody it. Now we’re seeing more attempts at hacks, so we’re thinking about things like insurance. That’s being built today. It becomes more relevant when there’s more total value being secured. But right now, I think it’s easier, and takes less education, to get a board to support something on the payment side of things.
Remy Blaire: And finally, Anthony, before I let you go, we are rounding out the conference here for Money20/20 USA. But given what we’re seeing with institutional appetite, what are your expectations as we head into year-end and into 2027?
Anthony Vassallo: A lot more of the same, so a continuation in terms of what’s being built. One thing that I think is not being discussed as much is identity. So we have all this adoption, and if we agree that it’s coming, I think the question should then be, then what? So for example, are emerging markets ready for a 10x increase in stablecoins? What are the questions that the regulators, central banks, and local banks are asking? And besides that on- and off-ramp, and doing KYC, and making sure no illicit transactions go through, do they truly acknowledge how fast money can move, and that there is no such thing as post facto compliance? So I think it’s about alignment, forming standards, and making sure that a lot of those questions are in place. And I do think, just in terms of some of the more natural use cases for crypto, the capital will come in. A lot of the tech is being built. It’s just not as much in the headlines.
Remy Blaire: Well, Anthony, a lot of moving parts there. So thank you so much for breaking all of it down, and thank you so much for simplifying all of this for our viewers out there. Appreciate your time.
Anthony Vassallo: Thank you.
