There’s no shortage of news about institutions launching tokenized money market funds (MMF): Blackrock, JPMorgan, State Street, BNY, the list goes on.
We hear less about adoption. Assets have grown from near zero to $15B, which sounds impressive until you compare it to over $7T sitting in US MMFs today.
The chart below shows the efficiency gains tokenization unlocks, but how many participants are feeling the pain of the current T+2, multi-step process acutely enough to move? That question points directly to where the tipping point for adoption will come from.
Treasurers feel that pain. But not those at tech firms or Fortune 500 companies — they already have direct access to institutional cash management solutions through their mega-bank relationships. And not Bitcoin enthusiasts parking a volatile asset on their balance sheet.
Based on my conversation with Tanner Taddeo, CEO and co-founder of Stable Sea, the real candidate is the most unlikely one. The middle-market treasurer: naturally conservative, not a tech cheerleader, and currently underserved by the infrastructure being built for everyone else.
We covered:
* The Mid-market treasury gap: Large companies get white-glove capital markets access from major banks, but mid-market/lower-mid-market companies are typically stuck with just a checking account and no access to yield-generating products.
* The benefits of tokenization: access the same money market funds but with 24/7/365 trading and near-instant (~10 min) settlement vs. the traditional T+2.
* Custody and trust mechanics: for Real World Assets.
* Adoption outlook and barriers: what it takes for conservative treasurers to embrace a tokenized solution.
And a lot more.
Watch it on YouTube or listen on every podcast app.
Selected Quotes
The problem Stable Sea Solves:
“We help companies access capital markets products. We offer money markets, we offer fixed income products and we offer some additional securities through the platform.
It’s different from some of the other products that exist on the market today because we give access to tokenized money market funds and tokenized fixed income products. And the value add there is that you can trade those funds twenty-four seven, three sixty-five, and then settlement is near instant.
So you don’t have to wait two days, to get liquidity out of some sort of security. , you don’t also have any lockup periods associated with those investments, and there’s also no minimums.”
I must say that we discussed tokenization in a couple of previous episodes (see below) of the podcast, and I was never convinced. You can tokenize gold bars and maybe it makes you feel like you own it and other benefits compared but a gold tracker ETP works really well. But here, instant liquidity instead of T+2 for treasuries - I get it.
We don’t NEED to understand the technology (only trust it):
“When the credit card came out, it was a new technological way to efficiently move money between consumers and merchants and then instill trust between the banks. So if I swipe my card at a Starbucks, Visa can help authenticate and move funds between my bank account and Starbucks' bank account. So there's complexity in virtue of how the technology works, but at the end of the day, it's just a more efficient way to help share value between two counterparties.”
Tanner distances his application from the volatile (and often dodgy) world of cryptocurrencies. But Treasurers still need to understand the technology, but you need to present it the right way.
Leading with the right narrative:
“Treasurers, finance teams, CFOs rightly so, are some of the most conservative people out there. Because the number one golden rule in the corporate treasury handbook is do not lose the company's money. And a lot of the finance teams don't buy on innovation, they buy to de-risk something. So you have to really lead with a narrative of security, and trust and compliance and all those things.”
The Theseus Ship of financial infrastructure
The global financial system is going to slowly, almost like Theseus’s ship, be replaced, by some of this blockchain and Stablecoin infrastructure. And so we like to lead with with content, but more importantly than content, it's actually sitting down with and convening with people, showing them how the product works, and then just having that conversation.
As an avid reader of Greek mythology, I didn’t know the expression, but it’s a very powerful way of thinking of innovation and change management.
About Tanner Taddeo:
Tanner Taddeo is the CEO of Stable Sea, a company helping enterprises modernize global payments and treasury operations with stablecoins. Tanner started his career in humanitarian finance, worked in investment banking across emerging markets and later helped build real-time payment systems for central banks with a Gates Foundation backed company. He’s also held roles at Plaid and Block’s TBD, shaping the future of open and decentralized finance. At Stable Sea, Tanner brings that experience together to bridge traditional and digital finance while making stablecoins a cornerstone of faster, more inclusive global payments
https://www.linkedin.com/in/tanner-taddeo-9b64562a/
https://www.stablesea.com/
Related episodes:
About the Investology podcast:Investology is the investment management intelligence show. Where innovators, investors, authors and experts discuss the future of investment management beyond the hype.Listen on every podcast platform, or watch on YouTube.
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About George Aliferis:
Founder or Orama, ex-banker, ex-sales, working at the intersection of investment management, media & marketing.
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