If you're reading this and still haven't signed up, click the subscribe button below!
This week Simon Taylor and Cuy Sheffield are joined by Christian Catalini, Founder of MIT Cryptoeconomics Lab.
🎙️ Listen to the latest episode of Tokenized here.
📷 Watch on YouTube.
We Cover:
Open USD tests cooperation on standards and competition on products
Lloyds and Visa take USDC settlement through the weekend
Spring by Citi plans acceptance while direct checkout demand stays thin
Meta’s Muse sharpens the debate over banking margins and distribution
AIVO tests which financial providers AI recommends
Robinhood and Public.com offer a playbook for controlled agent access
This episode was sponsored by Modern Treasury!
Build products that move money. moderntreasury.com
Trusted by companies like Procore, Navan, and Morse, and backed by over $600 billion in payments, learn how to adapt to changing payment rails and scale with confidence at moderntreasury.com
Shipping Comes Before Open USD’s Endgame
Open USD went live on September 30 across Ethereum, Solana, Base and Tempo. Businesses can mint and redeem it one-to-one with dollars at no cost, and reserve earnings are shared with partners.
Cuy compared Open Standard to Dee Hock’s early Visa, where members built the network together and competed on what they sold over it. Visa is one of Open Standard’s five founding partners.
“You can cooperate around the standards and how to issue [Open USD]. But then we expect to have vigorous competition among these members around the use cases and the value add services and the products around it.”
Christian agreed with the comparison and drew a tension from it. Founding partners may want different endgames depending on where they sit in the stack.
“There’s two futures for Open USD, two successful futures ... does it become a super profitable network of networks, or does it become kind of a piece of standard infrastructure that everybody really trusts and relies on?”
Simon placed the endgame roughly twenty years away, recalling that Visa took decades to face that choice. Getting Open USD off the ground comes first. Christian also allowed that early use cases could let the issue resolve itself.
At Sibos, the institutions Simon spoke to were most excited by par redemption, more than by zero mint and burn fees.
“I don’t want to be thinking about having to maintain some hedging against the tiny movements of a stablecoin against regular dollars. $1 is $1; it should work like that.”
Libra members began pulling in different directions within months, in Christian’s account. His harder adoption test is whether banks choose Open USD over issuing their own stablecoins or pursuing tokenized-deposit alternatives.
Weekend Settlement Gives Banks an Onchain Starting Point
Lloyds and Visa completed a seven-day pilot settling $750,000 in USDC from Jersey to the US, Lloyds announced on September 30. Citi’s September 28 announcement plans stablecoin checkout for Spring by Citi through Coinbase Payments, initially in the US. Coinbase converts the payment into fiat; Citi settles the merchant.
Visa chose a seven-day pilot to prove weekend settlement. For Cuy, scoped, low-risk pilots give major banks onchain experience. Christian sees them as preparation for programmable assets and collateral. At checkout, Cuy has seen no meaningful consumer demand for paying merchants directly, partly because stablecoin-linked cards already offer acceptance and rewards. Christian favours cross-border commerce. Cuy sees opportunity in B2B payments, and Simon points to wire-payment friction.
US banks have little incentive to hold a stablecoin for a consumer, in Cuy’s view, so conversion has to happen automatically.
“If you fast forward five years, you should be able to have someone send you a stablecoin, and it automatically just shows up as a deposit, or you should be able to withdraw from your deposits and have it sent out as a stablecoin.”
Agents Threaten Bank Distribution Before They Threaten Deposits
Apollo chief economist Torsten Sløk’s September 27 note argued that agents such as Meta’s Muse could sweep household cash into higher-paying accounts.
Simon had already taken the other side in Fintech Brain Food.
“I don’t buy that agents will cause deposit flight any more than fintechs cause deposit flight.”
Christian also rejects the run framing, while expecting pressure on net interest income from customers who don’t shop around.
Deposits stay sticky, Christian argued, because in the US the checking account is the only place salaries, bills and mortgages connect. Portability could change that, as number portability did for mobile.
Simon’s concern is product distribution. The AIVO study he cited ran 2,160 small-business conversations across ChatGPT, Gemini and Perplexity. In the endorsement figures Simon cited, Mercury drew 327 and Wise 184. Chase, the highest-placed bank in that comparison, drew 60. That puts competition at product selection, before a customer needs to move their primary account.
Banks Should Learn Agent Access Now and Keep Their Context In-House
Cuy asked how banks retain relevance as agents become an interface. Christian focused on ownership of the intelligence behind financial decisions.
“Imagine a world where you’re essentially just a dumb pipe, the holder of licenses, and all the value is created at the ChatGPT level or at the cloud level. I think that’s not the future banks want.”
Simon’s Robinhood and Public.com examples suggest a learning sequence.
Give selected customers constrained agent access.
Observe what customers ask their agents to do within tight limits.
Package useful workflows for broader customer use.
Christian supports experimenting with an MCP server, while retaining model weights and proprietary context, possibly using an open-weights model. Access and intelligence ownership are separate decisions.
Simon’s other test is security, including how a customer delegates authority to an agent and how the bank keeps that access safe.
For Christian, the more a bank relies on disappearing friction, the faster it should adopt stablecoins and agent access. If it already delivers value, it may be less at risk because agents will find it.
Looking Ahead
The next test is whether banks turn these experiments into services that work with the stablecoins and agents their customers choose. If they do, they have a route to staying part of the customer’s next financial decision, even when it starts outside the bank’s app.
Thanks so much for reading the Tokenized Newsletter!
Please share this edition or share it with your colleagues if you enjoyed it!
Disclaimers
This newsletter is for informational purposes only and is not financial, business or legal advice. These thoughts & opinions and do not represent the opinions of any other person, business, entity or sponsor. Any companies or projects mentioned are for illustrative purposes unless specified.
The contents of this newsletter should not be used in any public or private domain without the express permission of the author.
The contents of this newsletter should not be used for any commercial activity, for example - research report, consultancy activity, or paywalled article without the express permission of the author.
Please note, the services and products advertised by our sponsors (by use of terminology such as but not limited to; supported by, sponsored by, Made Possible by or brought to you by) in this newsletter could carry inherent risks and should not be regarded as completely safe or risk-free. Third-party entities provide these services and products, and we do not control, endorse, or guarantee the accuracy, efficacy, or safety of their offerings.
It's crucial to provide our readers with clear information regarding the inherent nature of services and products that might be covered in this newsletter, including those advertised by our sponsors from time to time. When you buy cryptoassets (including NFTs) your capital is at risk. Risks associated with cryptoassets include price volatility, loss of capital (the value of your cryptoassets could drop to zero), complexity, lack of regulation and lack of protection. Most service providers operating in the cryptoasset industry do not currently operate in a regulated industry. Therefore, please be aware that when you buy cryptoassets, you are not protected under financial compensation schemes and protections typically afforded to investors when dealing with regulated and authorised entities to operate as financial services firm.
