By Silicon Valley 101
Much like the credit card boom of the 1960s and 1970s, the U.S. is now witnessing a surge in stablecoin adoption as regulatory frameworks take shape. Major financial institutions—from PayPal launching its own stablecoin to Visa and Mastercard integrating stablecoins into their payment networks—are actively embracing this trend.
From Libra's Ambition to Today's Stablecoin Battleground
In 2019, Facebook ambitiously proposed Libra, a compliant stablecoin pegged to a global basket of currencies. However, this idealistic venture ultimately failed. Today, the stablecoin market is reigniting with competition—pitting traditional financial giants like Visa against blockchain innovators. What future will this clash create?
In this episode of Silicon Valley 101, host Hongjun sits down with Sun Lilin, founder of PlatON, to explore the deeper financial logic behind Libra's failure. The discussion covers:
- The five core streams of Crypto that define blockchain’s fundamental value.
- How these technologies could reshape traditional finance.
01 Why Libra Failed: The End of Globalization?
Hongjun:
Libra initially rallied major players like Visa, Mastercard, PayPal, and eBay as founding members. Yet, it collapsed. What went wrong?
Sun Lilin:
Compliance was a major hurdle. The U.S. had two competing stablecoin models at the time:
- JPMorgan Coin (traditional finance)
- Libra (Crypto Native upstart)
History shows that disrupting entrenched financial systems is extraordinarily difficult. Visa, for instance, represents an inertial force backed by 20,000+ banks. No newcomer—even with big names—could overturn this in just a few years.
Key Mistake:
Libra’s multi-currency approach was flawed. Had Zuckerberg positioned it as a digital dollar supplement, regulators might have approved it. Instead, Libra’s globalist vision clashed with Trump’s America-first monetary policies.
"Crypto is the dollar. If Libra had embraced that, it might have won."
02 Visa’s Open-Loop Network: Why It Won
Hongjun:
How does Visa differ from closed-loop systems like Apple Pay or Alipay?
Sun Lilin:
- Closed-loop (Alipay, WeChat): Own user/merchant ecosystems.
- Open-loop (Visa): A platform connecting banks, merchants, and users without owning any.
Visa’s strength lies in its republican governance model, mirroring the U.S. Senate:
- JPMorgan/BOA = Major players (Senate)
- 20,000+ smaller banks = Participants (House)
"Open networks outlast closed ones. Visa proves that nothing can be more powerful than everything."
03 The Five Crypto Streams Shaping Finance
- Open-Source Movement (Linux, Torvalds)
- Cyberpunk Ideology (Decentralized, anti-gov e-cash)
- Distributed Systems Tech (80s algorithms, now blockchain)
- Cryptography Breakthroughs (ZKPs, MPC)
- Monetary Evolution (Stablecoins as "digital cash")
"Money is memory. Bitcoin is a public ledger—a consensus memory—which gives it value."
04 Blockchain’s Real Innovation: Near-Instant Settlements
Traditional finance: T+3/T+1 settlements → Slow, error-prone.
Blockchain: Near-real-time → Liquidity gains, fewer failures.
Hongjun: Why don’t consumers notice settlement delays?
Sun Lilin: Current digital payments (Alipay, Visa) are database credits, not actual money movement. Crypto wallets (USDT, BTC) hold real funds, like cash.
"Code isn’t law—yet. Legal frameworks still protect users better than algorithms."
05 FAQ: Stablecoins & Blockchain’s Future
Q: Will banks adopt stablecoins?
A: Yes—as complements, not replacements (e.g., USDT cards via Mastercard).
Q: Can blockchain replace DTCC/Euroclear?
A: Unlikely soon. Trusted intermediaries remain crucial for large-scale settlements.
Q: Is decentralization essential?
A: For purists, yes. For mass adoption? Hybrid models (regulated stablecoins) may dominate.
👉 Explore how major exchanges handle stablecoins
Conclusion
The stablecoin wave marks a pivotal shift—bridging traditional finance and blockchain efficiency. While Crypto’s ideals push boundaries, collaboration (not disruption) with legacy systems may drive the real revolution.