Really it's only now I would say that we've had proper scalable infrastructure like ready to take stable coins to the masses. Noble is neutral purpose built infrastructure for the transmission and proliferation of these stable coins. I do believe and can anticipate that the launch of the app layer, it will be like a new era for for Noble because again, we've never actually had defy on Noble itself, which is kind of crazy. And yet there's all of this
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Welcome to the epicenter of the show, which talks about the technologies, projects, and people driving decentralization and the blockchain revolution. I'm so I think with you and I'm here with Yelena Jurek, who is the CEO at Noble. Noble is a Cosmos chain that's purpose built for native issuance of stable coins and RW as they are one of the key players in the USDC ecosystem. I believe they're probably 5th
or 6th in issuance. Now you'll correct me on Yelena, but if, if I think I'd check USDC dot cool. And you guys are sitting at somewhere around $350 million if USDC issued on Noble. You also have your own USD stablecoin USD and which we'll talk about. But yeah, how, how you doing? How's how's everything going for you? Yeah, No, thanks so much for having me on Seb. It's been great. Obviously it's stablecoin summer that is going into the fall.
I guess now that it's October 1st, it's been great. There's a lot of things going on, obviously the stablecoin space and I'm excited to talk about that and also some exciting updates on the Noble front. So thanks for having. Me so like stablecoin you, you mentioned stablecoin summer and and actually I think you're it's a very apartment way to talk about it because the stable mark the stablecoin market is now surpassed 250 billion. It's up, I think something like 45% this year alone.
There's much clearer USUS rules now. We have lots of announcements. Also, if you hear Paxos just announced their privacy focus stablecoin. I also read that Circle is going to enable things like reversible transactions. Obviously we have like plasma that's just launched their neobank. It seems like everyone is trying to get a, a piece of the stable
pie coin coin pie. And you know, a little, a little bit reminds me of other hype cycles we have in the space like NFTS and and defy summer and meme coins. And you know, if we look at those, a lot of that innovation and certainly the valuations have dropped off a lot. Why is stable coins different? Why? Why should we treat stable coins differently? Should we treat stable coins differently? Will we still be at this level of hype and excitement in a year
from now? Yeah, it's a, it's a really good question. So I think it's important to distinguish to your question like what is different about about this, about this time around. I think inevitably, you know, there will be overhyped projects that maybe don't sustain themselves and don't last into functioning products and businesses. But Despite that potentiality, there is something concrete kind of happening now, which is maybe different than previous hype
cycles that we've had in crypto. You know, to your point, whether that's NFTS or mean coins or the like. And that reason is, is pretty simple. That's legislation, right? So we had obviously the passing of genius a couple of months ago where it was signed into law by President Trump. We've had a very concerted effort by multiple interest groups, right, that actually want to see Genius operational and in full force.
One part of that interest group, of course is the crypto lobby, but it's also actually bigger than that, right? Basically what Genius is simply a revolution in payments, right? And so if you think about like the payments industry and you think about kind of what payments are and how payments kind of work today, it's pretty antiquated, right? And a lot of this payments infrastructure is running on legacy infrastructure that is pretty old, antiquated.
And So what is genius? Genius basically set the standard, a legal framework to issue stable coins as payment instruments, right? And obviously, you know, for crypto native people such as ourselves, we've been very familiar with stablecoins for quite some time. You know, some of us maybe you know, do payroll in stablecoins, get paid in stablecoins ourselves as employees myself, I've paid rent in stablecoins in the past.
You know, we're very familiar with these products, not to mention the trading defy use cases. But if you think about what Genius is and the framework it establishes kind of on more mainstream legacy level, it actually allows first of all, like legacy payments businesses to like legally, let's say, innovate and, you know, offer really interesting, you know, kind of innovative products that maybe are cheaper, more seamless excetera.
But then it also allows crypto projects like Noble to kind of play a role within that. So yeah, as you said, right now it's about a $275 billion market. Citibank just, you know, they had a report that said that by 20-30 will be at 1.6 trillion. They then actually upped that prediction to 1.9 trillion by by 20-30. And I'm like, let's remember, like five years ago or 5 1/2 years ago, we were at half a billion. So yeah, I mean, today, you know, today in the last year,
we're up 50%. But basically, we have a much, much longer way to go. And that is in a large part due to genius and the appetite from the legacy mainstream world to basically bring payment into the 21st century. Yeah. I think one of the key insights in what you just said is that it enables or what I take away from it is that it enables a new form of infrastructure for payment, for payment issuance issuers, for payment systems issuers.
And in many ways that's I think what we've kind of wanted block chains to be. You know, there's this idea that sort of been circulating for a long time now. It's like that we want block chains and D5 to be the rails of the financial system. And I, I feel like stable coins may be the catalyst that actually makes that finally the case, right? It sort of makes it possible. And so like this, this sort of institutional sentiment has
really flipped. I think Coindesk had this figure that 83% of investors are now planning more crypto exposure. Stable coins, I think are a big part of that because there's yield, you know, a lot of stable coins are sort of promising yield. How do you look at that? And you know, how should, how should investors, institutional or even retail? So it would be assessing the
different yield sources, right? Because 4.5% over here, 10% over here may, may not be, you know, not all yield is created equal. And I think people need to be more familiar and sort of aware of that. How do you look at that? Yeah. Well, well, OK, so I mean, first of all, like, let me just back it up for a second.
So basically, you know, to your point, obviously like the promise of blockchain rails was of course, you know, a lot of the kind of use cases and kind of ideals was around payments. It was, you know, peer-to-peer payment systems. Obviously this idea of financial disintermediation, even in the original Bitcoin white paper, you had this vision for Bitcoin as a payments mechanism. Of course, that is now not the
case. Bitcoin is not used as you know most often and in the majority of cases is not used as a payment instrument. It's it's obviously a speculative asset that is traded and you know at this point quite
commoditized. So on the one hand, like it did take us actually quite some time to get to this point where we actually do have the infrastructure and we actually have stable points again, as a product that are instruments that will not only have, you know, very sound legislation kind of governing their, their utility, but we also have the infrastructure and the actual, again, blockchain rails kind of ready and able to transmit and proliferate these stable coins
across, you know, a wide variety of use cases and distribution channels. And so I will just emphasize, like before we talk about like yield and stable coins that really it's only now I would say that we've had again, like proper scalable infrastructure, like ready to take stable coins to the masses. And I would also like kind of love to talk about why that is and how far we've come.
And again, like what is this infrastructure that we're talking about that is suited for us bringing stablecoins to mainstream? But yeah, to your question around yield, I mean, it's interesting, right? So first of all, when we talk about like yield as released to stablecoins, we're typically talking about yield that is generated from short term treasury bills. Obviously that is the mechanism that I would call classic traditional staple coins are collateralized by.
And so obviously with ingenious, there is very clear distinctions around how that yield is passed on. So kind of out-of-the-box, it's actually not compliant to pass on that yield sort of passively, right. So you have to basically have a mechanism where that yield is claimed or where distribution kind of and partners or entities like a coin base can actually take that USDC and pass on the yield by having, you know, people, you know, hold that USTC
on the Coinbase platform. So there is a bit a bit of nuance and like legally how stable coins, you know, are, you know, able to pass on yield. And another big part of this question, of course, is the clarity Act.
And basically that is more governing like Iran D5 and just generally kind of, you know, crypto tokens are perhaps are more speculative, but that will also kind of have some guidelines on again, like passing of yield and how that's some kind of compliant and basically for for for noble. And this is like one of the principles that we have held very dear to our heart since the beginning is Noble is neutral purpose built infrastructure for the transmission and
proliferation of the stabacoins. So Noble itself is a protocol, OK? Noble itself is a layer one. We of course are not ourselves a Stabacoin issuer. You kind of mentioned in the intro that we have Noble dollar. We're of course working with N 0 on that product. N 0 is a stable coin issuance protocol which works with a network of off chain mentors and issuers. Recently, Stripe or Bridge was announced as one of their
partners. But basically, Noble is distinct from the circles or the stripes of the world in the sense that we are crypto infrastructure again, for the transmission of these stable coins, right? So we like to work with wide variety, diverse set of issuers. And so, yeah, to your question around, I guess, like yield and like how this will kind of play out, I would say it's like the issuers themselves are kind of at the forefront of these discussions.
Like again, when it comes to Noble, we are crypto native. Obviously, D5 will continue to exist, but as an issuer, that kind of consideration or and how you pass on the yield, if at all to end users is basically within their purview, right? So basically you're going to have a situation where obviously you know, like what currently exists, which will probably what be the reality kind of after Genius is operationalized.
But you'll have a situation where the issuer themselves, like a circle can't by default pass on that yield. But the distribution partner, like a Coinbase, like an Ave. like a finance, really any entity, whether it's an exchange or even a defy protocol, can of course, you know, pass on yield in in in ways that is like safe and, you know, makes sense. So anyways, we can, we can chat a little bit more about that and, and how kind of noble thinks about it with composable
yield as it was to noble dollar. But basically the rules are just like now being established and there's no one path yet because the rules of the road have yet to be written by the OCC in the US as it relates to things like passing on yield.
Well, I'm, I'm glad you brought up composable yield because I think it's a, it's a perfect segue into the next question I wanted to ask you, which is currently I think most of the yield that these, you know, this kind of floor that we see around like 444 or 5% your comes from treasuries.
You mentioned short term and long term treasuries and, and having some of the mix there stable coins, You know, recently we had cap on, we also had FX protocol and of course, like these are, these are stable coin issuers, like different from, from, from Noble, but they're generating yield in different ways. Like FX has a stability pool that generates yield basically from, you know, sort of deposits
in its per protocol. You know, I, I feel like probably, you know, we, we can, we can keep juicing these yields for some time, but they'll probably dry up like the native Defy yields will start drying up unless new sources of yield start coming on chain, actual cash flows from off chain businesses. So, yeah, how do you think about sort of like the bringing more yield on chain and how are you guys integrating that into this so your yield strategy and composable yield moving forward? Yeah.
I mean composable yield is actually quite simple and we don't like to complicate things As it relates to noble dollar itself, like the core product obviously there's like, you know, kind of funky things that could be built on top of that. But as it relates to noble dollar itself, composable yield basically is as follows. So you have USDN which is actually over collateralized 103% by by short term treasury
bills. Of course that collateral pool is again managed and governed by the M0 protocol, but our implementation of USDN takes that yield component and basically makes it programmable and programmatic at the same time. So we tell distribution partners or we you know encourage distribution partners like like a, like a, like a DEX, a payments app really can be off chain distribution. On chain distribution, we really
don't distinguish. We basically say take that yield accumulation that is kind of happening in real time or per block basis and you can program it and direct it to any source or any destination that kind of fits your use case. So you can obviously take that yield revenue and you can distribute it to validators. You can do a buy and burn of your token, you can keep it as revenue.
And basically Noble's thesis again is on chain distribution, it's making sure that the Noble protocol can service app builders and make sure that there is proper incentives and like safety and like liability around that distribution of the underlying T bill yield. And we've had some pretty, pretty good success. So a few months ago, we ran a points campaign where we wanted to kind of demonstrate like this utility of composable yield, right?
And so we basically said, OK, so people can participate in this points campaign, they can get, you know, points, Noble points by deposit, causing their noble dollar into the into a points vault. But by doing so, you actually forfeit or give up the T bill yield that you would otherwise get by holding noble dollar. And what happened to that T bill yield that actually got distributed to a second vault, which was a boosted yield vault. And basically we sold people.
You can also just, you know, deposit your USDN into this boosted yield vault where you don't get points, but you get all of the yield that the people in the points vault gave up. And that was generating about 15 to 20% yield. And that ran for about four or five months. And basically, you know why we did that. And like a lot of people were kind of asking, well, how you know, how is that 50% yield generated?
Like is there something like happening on the back end like like like through like lending or something funky in that way? And the answer was no. Like it's literally fundamentally treasury bill yield that just got redistributed in a way that was quite simple if you think about it, where it was basically all the people that gave it up, it just got redirected to this other group of of holders.
And the reason we were able to do 15, you know, to 20% consistently was because obviously overwhelmingly the distribution or the ratio of deposits was within the points vault. And so basically, you know, on the one hand, we want to show, you know, noble dollar, look, it's like a thing that exists. It's very powerful.
And of course, the composable yield is this like kind of interesting new mechanism where you can start implementing it in, you know, a wide variety of ways and you could gamify it, you could create incentives around that. And again, it's all possible because the token itself has been designed and engineered to allow for the composability of that yield component. Makes sense? And so the USDN campaign, how successful was it?
Yeah, it was quite. Successful, we reached about 125 million at an all time high all organic demand across 30,000 unique wallets. And so, you know, it was very, very great to see that kind of organic, you know, demand kind of popping up. And yeah, I want to talk. About Cosmos a little bit, I mean, so noble is a is a Cosmos app chain and you know, launched at a time, I think when Cosmos was struggling from the downfall of of UST, you know, quite quite
some time afterwards. But I think like, you know, I think UST and, and the collapse of, of Lumina, I think had pretty significant impact on the Cosmos ecosystem overall. You know, feel like it's some of the all time highs there. And like the, the FT VS of most of the chains that were around in 2020-2021, 2022, you know, a lot of liquidity got, you know, removed out of the ecosystem in, in one, one moment.
I, I think when, when noble came online, a lot of people were expecting lots of USD liquidity to come into Cosmos. And some has, right, I mean, 350 million or, or some change, right? Is is nothing to sneeze at DYDX also coming to the ecosystem? At the same time, I think was very much anticipated and, and people saw that as a positive sign. And I, I think, I think the
option thesis generally. And so the sovereign option thesis continues to stand up and, and, and people all across the ecosystem, across crypto, I think still believe that's the case. But the Cosmos ecosystem as as the D Phi ecosystem has not really done very well in the last, you know, two 2-3 years despite all of this, right? Despite Noble coming there, despite having native USTC and despite, you know, lots of chains of using Cosmos tech. What's happening? What do you think?
Why do you think that is? Is Cosmos finally dead, Yellena? But I guess that's the question I want to ask you. It's like, do you think? No, it's. Not dead. Yeah. I mean, I think it's kind of a misnomer of a question because basically if you look at where Cosmos is, it's fundamentally the stack, right? It's Tenderman, it's Comma BFT, it's the SDK, it's Cosmosom, it's IBC. And if you look at all metrics across those like levels of the stack, it's actually quite strong.
What's not strong to your point is Cosmos native token performances. So if you like look at a chart or coin market cap and you kind of look at, you know, a token that is like an IBC token that like launches like unfortunately there isn't as much, you know, retail kind of demand for those tokens. It's, it's, you know, partially why Noble of course is launching this L2 on EBM, which is the Noble app layer and why the Noble token will be an Ethereum
token, not a Cosmos token. But basically as it relates to like the stack itself and it relates to adoption. I mean, again, by all accounts, it is the most performing stack to build an app chain, right? And whether you use IBC or not, I think also kind of dictates whether you're kind of considered to be like Cosmos. So like Noble, for example, right? We of course are have IBC out-of-the-box. We, you know, a lot of like volume, of course, liquidity routing is, is, is via IBC.
But we also have CCTP circles bridge. We also have wormhole. We also have hyperlane support, you know, probably will have other bridges supported by, you know, Chernobyl. And so, you know, I think that a lot of the times, you know, when you kind of look at what happened with Tara, like, you know, how much of Tara's success was because they were Cosmos or because they had a great product. I would argue they had a great product for its time. Obviously that was not
sustainable. Obviously, UST was fundamentally unsound, but you know, Anchor and what they, you know, did with the Terra protocol was obviously, you know, very valuable in some level. And that's why you had UST at a $40 billion market cap. And, you know, you had, you know, all of this like, like, you know, liquidity mining of UST and you had these like crazy, like AP wise.
And anyways, you also have like a lot of like really great defy on on Terra. And so basically, yeah, Terra was Cosmos and it was Cosmos because it's the best way to build an app chain. But they also have just had like a good product story and good use, like a like a really, you know, bullish community. And so I think again, like, it's not to say that that can't happen again, right?
Like it's all about the product. It's all about the, you know, like what you're actually building, who's a four, is it useful? Does it work? Is it broken? Is is there a good UX? All of these things. And so I think when you look at like what's happened since UST collapsed, obviously there was a really serious bear market. You know, you had FTX, you had Celsius bankruptcy, you had things happen.
And then what happened after that was somewhat of a bubble market that was started basically within the salon and ecosystem. Why product? What was the product correct meme coins. And so again, like Cosmos showed you could build really performant app chain infrastructure for D5, for stable coins, for trading, for like all sorts of things. Solana showed that you could get incredible mindshare and retail
adoption of meme coins. And of course there is like some performance reason for that because of the way that Solana works. But basically it's to say that if you look at any major L1L2 ecosystem, typically it's like power law distribution of like where the activity and liquidity is and it's usually concentrated among a handful of products and
applications. So like even salon it right, like yes, pumped off on like kind of kicked off, you know, the trend you had bonk you had obviously, you know, then there's like things like Jido, but like overwhelmingly a lot of that activity and liquidity in mindshare was around pumped off on. And then and you know, you look at, you know, things like, you know, hyper liquid overwhelmingly now that's kind of maintaining a lot of
mindshare. And so basically, you know, I would say that on the one hand, Cosmos of course, can never be done because you have the stack which will continue to be like the best stack. Like I mean, even talk about like stablecoin chains, like Circle, of course, is building their stablecoin layer one pulled arc and that uses comet
BFT for consensus. You know, you have obviously Noble, which of course leverages some parts of the Cosmos stack and of course has this like separate execution layer around the EVM. But yeah, I think there's definitely no logical way you could see that Cosmos is dead. Yeah. That that that's, that's really
great. I think it it kind of aligns with how I've seen and talked about Cosmos over the years and and that the analogy I often use is none of the none of the nerds that were fighting over the right distribution of Linux to use back in the 90s got rich because Apple devices and every Android device uses it uses a Linux kind of like core kernel. The nerds will come at me and tell me that's what I said is is
inaccurate. But but basically that, like most devices nowadays use Linux infrastructure and I think Cosmos is kind of similar, right. It is it is really the best stack to build stop sovereign app chain infrastructure. Just that you know, unfortunately there isn't a mechanism by which Adam holders get rich or sort of Cosmos token holders get rich because your circle built circle builds their their app chain using a common
PFT. And and I think to some extent Etherium does suffer a little bit from a similar fate with the roll up road map where value from all these roll ups doesn't necessarily accrue to Ethereum. And but you know, the EDM is the best way to, you know, write smart contracts and write applications on blockchains that hasn't the most amount of developers and etcetera. So I think a lot of stacks are kind of reeling with the same sorts of problems of value
capture. And I don't know what the way around us, you know, do we have licenses where those who use the stack for commercial purposes need to pay some, some fee or some licensing fee back to the token holders? I mean, it seems very difficult to manage. So I, I don't know what the, what the solution is here. Maybe the solution is just, I mean, maybe there isn't a solution and just people have to accept that just because someone's using your stack doesn't mean that you or
someone's using the stack. That you know that that you invested in some other token doesn't mean that you're necessarily going to benefit from that. Well, I'll give you like an analogy here. Just because I have an app in the Apple App Store doesn't mean my app will be successful, right? So. Just because I have quote UN quote distribution through the App Store doesn't mean it's going to be in the top 20 use apps because it has to
ultimately be a good app. So I think like this idea that just because you're building something on Solana means, oh, all of a sudden it's like the next pumped off fun, like doesn't make any sense, right? Just because I'm building, you know, on Ethereum means I'm going to now get all of the liquidity of Ethereum defy. Like that doesn't make any
sense. So yeah, I mean, I think that the same goes for Cosmos. I think the difference maybe is because like from a narrative perspective, the app chain thesis has been focused on apps, right? And so we understand like apps is where the value accrues. And if you don't have a good app, then you won't get value and neither will perhaps that value trickle out to other app chains within that same ecosystem.
And so I think like with Terra, obviously we had a very successful app, right, very successful app chain for its time. And then of course, it destroy itself. But what did that show? It showed that value can accrue to the app player. It could accrue to the app chain, it could accrue to the token holders. And you know, you could argue, oh, well, that's why, you know, other Cosmos app chains did well. I think that's a bit of a
rewriting of history. Like it was also just generally a bull market and many applications did well, not just in a Cosmos, but also in Ethereum. But basically, if like your only source of like demand for your token or your app is because like your, you know, neighbor is doing a good job, like that's not a sustainable Moat. And so basically you have to kind of think about, OK, well, how will distribution happen in the future? Where will demand come from? What is the product?
Is it sustainable? Is there a Moat? Is it easy to use? Is it differentiated? So, you know, basically I think crypto people like have to build real businesses and I think that's a good thing. And you know, I think Cosmos is still the stack itself is still a very solid stack. Yeah, I agree. I mean, I think all that makes sense and it bears repeating and it bears reminding ourselves and folks in the ecosystem all together. You know, that's Cosmos people.
I, I think the last time we spoke when you were on the interop was quite a while ago and there was some you were talking at that time about having an EVM on Noble. How has that? Yeah, can can sort of share the latest on that? Yeah. So this is something we're we're working towards and really excited about. So we're going to be launching something called Noble App Layer. We'll probably be branding at something different, but for now we, we're calling it the Noble App layer.
And basically the Noble App layer is an EV ML2 using Celestia for data availability. You know, kind of Speaking of Cosmos, Speaking of the stack, there's quite a, you know, a few reasons why we decided to build the EVM component as an L2 versus adding it on top of the Noble L1, which of course is the Cosmocell one, which is currently, of course, in production. And you know, quite, you know, significant in terms of volume and routing and adoption.
And basically the reasons kind of are as follows. 1 You know, there is a lot of exciting innovation taking place like in the Etherium world as it relates to performance. You know, Celestia I think is obviously like a huge part of, you know, what makes, I guess like if you're more delightful to build on top of kind of given their, you know, data
availability innovations. And so, you know, that's one part of it. We wanted to, you know, also make sure that we were exposed to the EVM ecosystem and just, you know, historically EVM on Cosmos has been challenging to say the least. And so, you know, we figured first of all, there was a huge product need for smart contracts and programmability, you know, for Noble. And adding an EVM layer on top of Noble was not necessarily the
best engineering decision. And so we figured let's deploy basically an L2 on top of Noble that would be validated and secured by the Noble layer one, but which could act as a distinct execution layer for sorry to. Interrupt here, but even with the Cosmos sort of EDM stack, yeah, curious why why you chose to do an L2 rather than use that stack which has the EDM kind of built into it? Well, so so the EVM is actually not super like well maintained,
right. If you kind of look at like how the EVM kind of software has developed over time, you have like EVMOS now you have other kind of players attempting to maintain that. But I mean, I'm sure you you understand like EVM is as a as as as a software, you know, it needs to be maintained to make sure that it's like secure and that there's like, you know, de risking from like a bugs
perspective. And so basically we felt a lot more comfortable in the maintenance and the, you know, software of EVM proper kind of on you know, as it relates to Etherium. So that was, you know, very much like a concern around, again, like stability, security, making sure we're always properly following major releases and that the software that we use is well maintained. And so it just made sense to again, build this EVM app layer basically as an L2 using Celestia for DA.
And then again, performance, right? Like our EVM app layer. You know, I think like yesterday there were some benchmark testing and it's like 100 millisecond block times, right? Super fast. That's faster than Noble Core, right? Noble Core is like 1.2 seconds, which is fast, but it's not call it fast like like like the app layer which can support, you know, all sorts of things that core can't support from like an
execution perspective. And so you know, that was an obvious decision for us. Again, we love working with the Celestia team. We think the you know, the, the kind of software that is maintained again is very solid and it just kind of made sense for us. Also, again, like talking about like the power of like the Cosmos stack, like, you know it, not that this was like trivial work. It was definitely a lot of hard
work. But there is also a world where of course, Noble Core validates and secures the L2. And that's also was a big part of the discussion. Like can we have a single sequencer L2 running on Celestia DA secured by the Noble validator set in a very secure manner? The answer was yes. And so we're very excited to be basically championing that
model. I did a long tweet thread on kind of what makes this model perhaps different than like other kind of roll up designs within the Etherium space, which may be like we can link them in the notes. But basically a lot of what we've done with the Noble Core validating and securing the L2 is very similar to kind of like the native roll up vision that I believe Italic and others put forward. And yeah, we think it's pretty
interesting. I mean, of course it's different where the Noble Core is a proof of authority chain, right? So we don't have like a proof of stake kind of economic security model with like, you know, a bunch of token stakes. But we actually think that the proof of authority model works very well for our use cases which are stable point centric. So anyways, it's a lot of indifferent decision making factors that kind of led us to where we are today.
But I think that kind of speaks to like our approach and our philosophy, which is like, let's be very methodical, let's be very considerate around the architecture. Let's talk rush things just because everyone else is doing it one way. We, we, we want to make sure that the way we do it fits our use case and fits our
principles. And basically, I do believe and can anticipate that the launch of the app layer, it will be like a new era for for Noble because again, we've never actually had defy on Noble itself, which is kind of crazy. And yet there's all of this traction. So yeah, we'll see what happens. And he talked a bit about the role of the Noble token in this, in this new L2 and and this D Phi ecosystem that you want to build. Yeah. Definitely.
And we'll have some really exciting announcements actually on the Noble token very, very soon. But at a high level, we're talk, we're thinking of the Noble token in like 2 ways. So one, it will be the base fee token for the app layer. Basically will users can still pay fees in stable coins as they currently do on core, but they'll be a mechanism where that fee, those fees are swapped into noble token kind of on the back end.
And there's like a kind of a pave masters like account system around the kind of fee fee mechanism for the app player, which again is noble token under the hood. So again, assuming there's a lot of activity and users and you know, products on Noble App Player that are well adopted that will be positive for the Noble token. And then the other piece is actually governance. So we are keeping the proof of authority model for validation.
So there will not most likely be staking, but there will be governance. What does that mean similar to, you know, kind of other models where basically you could use them like the governance token to have certain incentives or have certain auctions for, let's say, you know, deploying liquidity into certain pools. You know what we call like bribes in the Curve model where you have like AV, in this case AV Noble token. That's all kind of on the road
map. And we actually think again, defy is at this point battle tested and we have some pretty interesting applications kind of in the works. And if you can layer in a Noble token on top of that where you get the community kind of excited and incentive incentivized and motivated to kind of govern those various applications, I think there could be some interesting, interesting things. Where do you? Expect stablecoins to be in three to five years.
And what will be Noble's role in that ecosystem? Yeah. Honestly, I think it's just the beginning. Obviously we have all of plethora of purpose built stablecoin chains launching, which I think is, is ultimately +1 of the ways that I like to think about differentiation among those app chains. And you know, perhaps nobles kind of roll with within that differentiation is basically as follows, right? The Tam for stablecoins, for stablecoins payments is massive,
right? Like we mentioned earlier, this kind of 1.9 trillion figure from from city. I I've seen, you know, I've seen predictions as high as 4 trillion from financial institutions. But if that is to be the case, you're going to have specialization within the payments landscape that basically leverages certain stable coin infrastructure,
right? So for Noble, if we think about Noble's app layer, if you think about Noble core and performance and stability there, I do see Noble playing a significant role in this future payments kind of revolution around stable coins. Whether that is more on the B to C side, you know, it's something
we can kind of anticipate. But we've had some pretty exciting conversations with, you know, legacy traditional players kind of coming into the space, looking at the space and and saying basically we have a need to transform our payments infrastructure. Let's think about how kind of Noble and again, layer ones kind of fit into that landscape.
So Noble will continue to always exist as this kind of router of activity, as a origin chain for the minting, for the redemption of these stable coins because of our performance, because of our battle tested infrastructure. And basically we want to see Noble and the app player do a lot of stuff on the consumer facing side. So obviously it's early days, but again, it's exciting days and there's a lot more to come. Great. Well, you know.
Thanks for coming on the show. It's been great chatting with you, getting an update on Noble and also getting a glimpse of the future. So excited for Noble and the things ahead. Amazing. Thank. You, Seth.