Canada Politely Moves To Solana🍁$CADD Stablecoin CEO INTERVIEW❄️

0:00 Canada has entered the stablecoin market, and it is going to be a hot one today. We're going to break it down for you. I want to thank our sponsor today, and that is Tangem, where you guys can get into full self custody. Very easy to do. Your secure crypto hardware wallet. And one of the things about Tangem that I think a lot of people misunderstand with self custody is the ease of use and also the ease of being able to get this set up for you. It's like a credit card. Works with your phone. Always present.

0:27 Make sure to get a three-card set so you've got a backup. But you guys, of course, can use our link down below. It's going to give you a 10% discount. And they also have several offers from time to time. So always check what's going on over there on the website. This is the self-custody to use. So make sure and check it out. Tell them we sent you. Joining us is going to be Didier Lavallee, who is the founder and CEO of Tetra Digital, the founder and owner, I guess, or launcher of CADD. So great to have you on the show. How are you? I'm great.

0:57 Thanks for having me.

0:59 All right. So we did a Canadian digital dollar video the other day. It absolutely went nuts. So the audience clearly wanted to learn more about this. So we said, let's get them on the show. And you, of course, was kind enough to say, yes, let's just go into it. I want to talk about the first thing, and that is the demand that is setting up for CADD. If you look at the ecosystem map right here, As I show this for some of you guys, you might be able to see this right here, access wallets, some of which you'll recognize, BASE is on there, Uniswap, MetaMask, Coinbase, Phantom, the big ones, conversion and payments, liquidity and trading, networks, on-chain metrics. You've got Aerodrome in there, BASE, Ethereum, Curve. These,

1:44 of course, are staple names in the crypto industry. Moving forward, what has been the demand so far?

1:54 Yeah, it's great. It's growing, I would say, very steadily and well for us. We launched in May. We got regulatory approval in April of this year, launched in May. And as you can demonstrate, we've been really focused on setting up the right partnerships with the right infrastructure providers. September was a good or great month for us. We did about just over a million dollars worth of liquidity on chain and organic liquidity. So we're not subsidizing anything in terms of liquidity. This is all users coming to the various pools and transacting our token. So it's growing really well. And unfortunately, I apologize, but Orca was not on the list. We launched on Orca last week and that pool has just been blowing up. I mean, it's

2:38 doing about half our volume every week, every day.

2:42 We can show it. Yeah, we can show it right here. It's leading the CAD digital markets right there to back up your statement on Solana. which the demand is now outperforming Ethereum. Why do you think that is?

2:56 I think Solana has an amazing community of users. They really are passionate about the protocol. And we saw at the summit last week in Toronto, lots of enthusiasm around what we're doing. The foundation works well as well with the ecosystem. So we're very excited about some of the things we're doing with the foundation. And it's just an overall amazing community and they're showing up.

3:20 Well, I think the innovation side of Solana looks to new projects and it always attaches to them. And if it's a quality project, I think people understand it, especially the Solana community. They can sniff out anything that's not right quickly. So the fact that you've got validation there is huge. I'm looking at a story here by the Walrus.

3:40 This is in reference to Visa and MasterCard and the growth it has in Canada. I was surprised at this number right here, DDA. And that is Visa and MasterCard controls 96% of Canada's credit card market. So pretty significant overall. When you look at that and how this impacts the use of stablecoins, because I think we've seen Visa and MasterCard make huge inroads on stablecoin credit card bases here in the United States and abroad. How does this affect your play into the market with the Canadian digital dollar?

4:16 I think it's important for us to consider MasterCard and Visa as partners. And actually, we view both of them as partners. We're part of the MasterCard crypto program and we also work very closely with Visa on a variety of opportunities and projects. You know, Canada is a very traditional but also conservative market when it comes to financial services and institutions. And as such, you have many incumbents, big six consortiums of banks. They're really tied together. So we work with the infrastructure as opposed to trying to work against it. And I think it's an important part of our strategy. And it's showing up on how fastly there's an option.

4:56 All right. So here is the point I want to get at. I'm looking at further in this article. I thought this was an interesting spin. And this was in 2022. Rogers had an outage which affected 12 million subscribers. It was estimated that this basically cost Canada... around 142 million. Pretty big impact. The point I'm getting at is that Canada continues to lean on American infrastructure. This has been one of the things that Carney has stepped out and said, wait a minute, we're not going to go that direction.

5:28 And digital assets may be one of the drawing lines now where Canada and the U.S. start to go head to head for some of that market. When you look at Carney and what his broader strategy is overall, How does that play into how you guys are going to market with CADD?

5:49 Yeah, we're very excited about the strategy that Carney has put in place in terms of financial innovation and competition. We have very strong top of the house signals that our government wants more projects like CADD to come to market and more disruption and innovation when it comes to financial services. I am a believer that Canada wins when we are strong partners to the U.S. Our economies are tied.

6:18 But sovereignty is incredibly important. And you need sovereignty over your dollar, right? And the Canadian dollar and having a stable coin that's essentially native to Canada, sovereign, and controlled by a Canadian organization is important and fits right into what Carney is trying to do.

6:38 How closely are you guys working with the Canadian government in terms of this? You've got Circle and even Tether to a certain extent working very closely with the White House and the administration here in the US. What about with what you guys are doing at Tetra to work directly with Canada in some of their strategies? I mean, you've got the EU and Canada announcement here, which is a partnership packed with the EU. So where can you guys participate in some of this expansion, especially around digital assets?

7:12 I would say we participate both in, I would say, public forums and private forums. So what do I mean by that? The government has been really good in engaging with the industry. As such, we're an active participant. We have made some submissions that are public, that are available for people to go look, in terms of what we're saying, and specifically as it relates to the Canadian stablecoin strategy.

7:37 And then I would say also actively in rooms with government talking about how they're thinking about legislation, building the Stablecoin Act, you know, what it is, what is necessary for Canada to be competitive at global scale in terms of the product and the way the laws are shaped. So like anything, I would say lobbying and advising the government and, you know, the various regulators includes some certain amount of polish and also being able to have active dialogue, both private and public. And we're very active in both fronts.

8:13 I do believe Canada really understand what's at stake. They've moved incredibly fast in terms of the stable coin act. We expect the drafts legislation out pretty much any week now with an implementation early in 2027. And by government standard, that's pretty fast.

8:31 Yeah. So that's an act similar to the Genius Act here in the U.S., which kind of set the groundwork for digital assets and mostly stablecoins. All right, so let me ask you this question, because I know this is an issue that we have even here within our own news coverage, and it's always the issue of regulators not understanding the crypto market at broad. Is that a problem that you have in Canada, trying to get regulators to truly understand what is at stake here right now?

9:03 Yeah, I would say Canada is an interesting place because, for example, on the security side, we have 13 different regulators, right? I think for financial institutions overall, if you play across the entire landscape, there's about 21 regulators or self-regulating entities that you have to deal with. So it's fragmented and it's a complex environment. I would say some of them understand incredibly well the potential of this technology, their center of expertise and innovation within those regulators and they're at the forefront of what's going on. I'll probably give the example of Commissioner Pierce as an example, right? Very public, talks a lot about what's going on. I also saw she resigned. So that's unfortunate for the SEC. So we

9:47 do have these thought leaders that are present within the regulatory bodies, but it also comes down to what the country wants to be, what's the overall direction. And on that, there's still a lot of education that needs to happen. Canada, was very early in digital asset. Yes, Ethereum came out of Canada. We also had the first ETFs come out of Canada. We had the first regulatory framework for crypto trading platforms. And then I would say post FTX, things really slowed down. Risk went way off. And now we're bringing that back and there's constructive dialogue. So It's a challenge, I think, like anywhere else, but we are seeing things change and there's pockets of enthusiasm that are spreading and

10:30 we're leaning hard into it.

10:33 You know, Canada retail is still very active and surprisingly so. I know when we look at our own metrics on our audience, Canada usually is in the top 10. You have obviously the UK, the US, some of the other markets out there in Asia and the Middle East that go, but Canada hangs right there in the top 10 in terms of interest in our content, which is mostly technology around what we're seeing in crypto and digital assets. So do you think that the consumer market is prepared for this evolution that's happening right now worldwide?

11:08 I think it is. I mean, some of the stats is about one in three Canadians holds digital assets and And as it relates to stable coins specifically, I mean, one of the stats we like to point out is one in five Canadians sends money back home. The way our construct works, you know, I think it's 70 to 80% of Canadians are first or second generation immigrants in our country currently, which means that a lot of them are sending money back home to India, Pakistan, the Philippines, et cetera. So they understand the value of digital assets.

11:39 And even when we recruit, We get a lot of people that come to work at Tetra that basically say, I send money back home every week or every month. And I do it on stable coins because it's better technology. And I want to help build a Canadian stable coin. So certainly believe that the population will adopt. The other piece that I believe is incredibly important is the safety and soundness of whatever you provide to the Canadian population.

12:10 We are a fairly conservative country when it comes to financial services. And as such, anything that individuals will trust need to be incredibly secure and well-regulated and governed. So we take that responsibility very seriously.

12:25 I have a couple of questions for you around the largest Canadian companies. I'm looking at the list right here. This is 450 companies or so, total market cap around four trill. You got the Royal Bank of Canada in there. Number two, Shopify. And then it is, you know, TD Bank, Scotiabank, Bank of Montreal, Enbridge. A lot of finance, okay? You know, kind of hovering around the top there in terms of market cap. Two things here. One, Shopify could be a secret weapon. This is a major retail function. It has the possibility of going absolutely huge in terms of digital asset payments. You look at that market and then you look at the banking side of this. How do you guys fit in those two major sectors? Because here in

13:14 the US, it's almost like the banks are against the crypto companies. How does that play out in Canada?

13:20 Yeah, no, great question. I think to no surprise, the technology components and partners that we have are always the fastest movers, right? They're excited about the technology. And if you look at the Shopify partnership, I mean, that came directly from the top of the house. They see what's going on globally. They see flow of funds and think about the capacity from a Shopify to program your treasury function.

13:43 So be able to move capital pretty much programmatically all over the world. That's happening on stable rails. It's not happening on any traditional construct. So that adoption is very quick. The banks in Canada have been relatively slow in adoption of digital assets. but they realize they can read what's going on in the US like everybody else, the largest financial market in the world. And they're now playing catch up very aggressively. There are certainly a lot of optimism as to what the banks will be able to do.

14:17 And then the market, I strongly believe the market will dictate what the best solutions are, right? You saw a headline recently around tokenized deposits for financial institutions in Canada. And at the end of the day, if you're creating a walled garden, well, the walled garden will only allow the people within the garden to transact, right? Stablecoins are also around fungibility and interoperability globally and at scale. So I do believe that over time, financial institutions will become increasingly important partners of Tetra. And we have some great ones today. We have National Bank. We have ATB Financial as well. They've been supporters of CADD since day one.

14:57 Let me ask you this, because obviously your success with Orca within Solana, you look at Shopify and Solana Pay, even though this is news, it was back in 2023. You guys remember this. We've covered this pretty heavily. Then you look at the Fiserv platform, the digital asset platform on Solana, all launching. What kind of message do you think this sends to Canadian banks? I know what it sends to American banks here in North America around Solana being a potential for rails when it comes to maybe some of these biggest financial institutions out there, including you guys?

15:34 I think there's a healthy debate within Canadian financial institutions around permissioned and permissionless blockchains and which are going to win. And then you obviously have protocols like Canton that have been approaching financial institutions really heavily. Ultimately, the banks will have to be able to, again, connect into the environment that's used by organizations like Shopify, Fiserv and where retail users are using.

16:03 Right.

16:04 So I envision a view where you have fungibility around those environments. I think Solana is incredibly well positioned. I would also point out that some of our other partners that are up and coming change, you know, we have a partnership with Temple, with ARK, that are purposely built for payments as well. And some of these things are really interesting to pay attention to because they offer features that from a payments perspective might become really interesting.

16:32 I noticed you guys put this out. This was in reference to your partnership with Circle to bring CADD, the first stable coin there regulated into ARK, which you just mentioned. Are you at all concerned that Circle would launch a Canadian dollar, you know, like a USDCC, you know, in terms of being able to compete?

16:54 Yeah, great question. Would they do it? I'm sure they're thinking about it, right? And, you know, I think the reality or what I would share with the audience is, you know, you see them everywhere in Canada and I'm sure in other jurisdictions as well. Now, what would be and is really important is that they are going to launch a, let's say, a Canadian token, that that Canadian token is actually backed by Canadian securities. And it's under Canadian jurisdictional review, both from a regulatory perspective and from a governance perspective. I think the last thing Canadians would want to see is essentially a U.S. company playing within the Canadian dollar space, right? but doing it from the other side of the border. So I think there's probably

17:44 a way for them to come into market, but the Canadian sovereignty and nativeness of what Tetra is doing plays a huge part in your adoption curve. And I don't think that's necessarily going to change.

17:56 All right. So that kind of brings up the question of the competition. Globally, Tether has kind of been one of those companies that has been very neutral, which is why it's been picked up by almost every region of the world when it comes to digital assets. Now, USDC Circle making its way into distribution, BNB partnership with Binance, obviously getting distribution with Coinbase. What about the competition of Canadians actually preferring to use a USDC or a USDT versus something like what you guys are building? How do you approach that?

18:36 It's actually a huge reason as to why we launched. We saw a lot of Canadian companies building on U.S.

18:42 Rails.

18:44 So they were using USDC specifically and primarily in Canada to build infrastructure around their company. And we would go and we would speak to them and they would tell us, well, it's imperfect because I'm wearing FX risk. I would really like to be able to do this with a Canadian token. And that gave us a lot of, I think, information, but also capacity to focus and think about product market fit because we had such strong signals as Canadian businesses wanting and were demanding a Canadian stable coin that could be used. I think globally, listen, at the end of the day, US dollar is still a global reserve currency.

19:25 I don't think that's necessarily going to change. But if you're in Canada and you're sharing money abroad and you can do it out of a Canadian token, so you're not wearing any FX risk, As long as I can off ramp that token in whichever jurisdiction that they want to send it to, then Canada and a Canadian token can become a preferred way of moving assets. So for us to compete, I would say for all non-USD token to compete really well globally, we need to be able to have scale, reach, and then the right partners and the right jurisdictions to be able to off-ramp our token into whatever local currency is needed.

20:06 I'm looking here at the stablecoin market cap. This is a reference to the CADC dominance right there. You've got it going on. When you look at that and the comparison to CADD versus other Canadian dollar coins, how does this play out? Do you feel like you guys are the circle of Canada and that you're going to control the market and take share?

20:31 Yeah, it's really interesting you see that. I think that chart gives you two things. One, still incredibly early in Canada, right? Still a lot to be done for us as a market. And secondly, what's important for the audience to understand is both the CADC and QCAD are securities. They're prospectus-led stablecoins, which means that they cannot be used by payments. They cannot be used by retail users. Their entire utility is essentially to be on a crypto trading platform as a trading pair vehicle. So the utility is incredibly different between what we've put out and what they have. And I think over time, the market will continue to be attracted to our token.

21:16 Didier, how do you guys handle paying yields? Because here it's a very dicey topic. You've got the Bank of Canada now planning to bring stablecoin rules in 2027. We just talked about that. This is an issue today. Most of the exchanges out there are still paying yields. A lot of private wallets and self-custody wallets still paying yields.

21:39 What about you guys? Will you pay yields on CADD?

21:44 Yeah, the yield conversation goes back to what I was mentioning earlier around competitiveness of the Canadian token and the framework. So we have actively discussed with government the need of a yield or rewards. Cause I know we yields the bad word. Now let's call it rewards as a necessary step for Canada to be competitive at, at scale and globally. Ultimately, nobody wants to hold a balance on something that's not generating a return, right? Because if you're doing so, then you're just going to swap into something else where you can get a return either overnight or on a weekly monthly basis. So I think it's an important part of the dialogue. I would represent that right now things in Canada are still in flux. And why do I say that?

22:29 You haven't seen the legislation yet. So the initial draft talked about no yield. The conversation seemed to have moved. Clarity was killed. Genius is in place, which actually allows more yield than Clarity would have. And I'm sure our regulators are paying attention to that. But our thesis continues to be for Canada to have a competitive offering. It needs to be able to pay something out.

22:56 Are you having the kind of pushback from the banking industry in Canada against banning these rewards?

23:05 Absolutely. But I would say it's done in a very Canadian polite way.

23:11 Not in the, well, we won't say names, but not in the way that some of the U.S. banks are doing it to the crypto industry.

23:17 That's right.

23:19 All right. So I want to get into more of a sticky subject. This is one that's close to my heart. And that is freedom of speech and the idea. I was very upset when I saw these things happen in Canada where we saw banks began freezing the accounts to these truckers. And this was in reference to these protests.

23:38 It went pretty bad. It went viral around the world. And these truckers, I felt like, were in the right. There was no reason for them to get banned accounts, especially your bank accounts. They even got into the point where it was trying to control activity on the digital asset side of things. Are you going to be in that same framework? Because even today inside Genius, these stablecoin companies can go in and claw back inside of accounts.

24:03 So how does that work for you guys, especially with this very touchy subject that has already happened in Canada once?

24:12 Yeah, I think it's a great question. And I would also say it's probably, Paul, a complicated question. And what do I mean by that? We are a regulated institution and as such, we answer to our regulators, you know, first and foremost, but we also, you know, need to have the balance as to what's right and what's wrong within the institution. As things progress, Canada will need similar mechanisms for regulated players that are offering digital money like Tetra to be able to, you know, do certain actions.

24:54 The question we still have at Tetra very transparently is whose authority will we act under, right? Because again, we're a regulated business and as such, we need to conduct ourselves a certain way. But for me to go, let's say, freeze somebody's assets, which authority do I actually have to do so? So I do believe it's a complex question.

25:16 And ultimately, For this project to work, we need to be able to work in partnership with regulators and government, but we also don't want to overreach in terms of power.

25:30 How much infrastructure do you think is being put in place to track the activity of these wallets? Because this is another thing that we're dealing with, I think, globally. When you deposit stablecoins in your wallet, and you want to swap out because of, let's say you're a trucker in Canada, and you're going to go out and do a protest, and you're going to say, I'm going to flip into Bitcoin or into something else, and I'm going to do it quickly here. How is that being tracked from a forensic side? Are those kind of discussions coming up in Canada? Because I know they're coming up here in the US.

26:06 There's certainly conversations, and we do have a role and responsibility in terms of, I would say, wallet monitoring. but it's mostly blacklisted addresses and jurisdictions you don't want to be interacting with, right?

26:18 Right.

26:19 So list and whatnot. There's no surveillance program as to who owns what. Um, and actually, you know, I'm a pretty, pretty aggressive nonbeliever of, of, of certain tools that are allow you to pinpoint who owns what wallet. Uh, But being able to monitor where the token is going on chain and what it's doing, I think, is a healthy practice, specifically as a regulated entity. And that certainly will be part of our construct. And I think the Staplecoin Act construct to be able to demonstrate that, for example, their token's not in Iran, you know, very drastic example. But those would be one of the things that we would be monitoring for. All right.

27:02 This is an angle that I think we should address, and that is in reference. If you think about growth, one of the things that has been absolute paramount in terms of growth has been meme coins. Hear me out. The U.S. is the king of meme coins. But right behind that, you've got India, United Kingdom, Philippines, Nigeria. And there it is, right there, the Great White North is number eight. So there's interest here on meme coins. You guys potentially could be the perfect meme. I mean, we've had memes of Carney. Carney himself could be memes that could benefit Canada in terms of the way of just trades and things of that nature. Plus, you just have so many different opportunities here around Trump and his meme

27:50 coins and the fact that we've seen this already with heated rivalry. And then you have all the perfect products. You've got the maple syrup. You've got Dan Aykroyd trying to do some stuff. I mean, you guys got a lot of famous Canadians. So why not create an infrastructure for meme coins? Because pairing with these meme coins is huge.

28:11 Yeah, I think it's a great question. The way I would answer it is ultimately what Tetra is trying to do is have a real impact in terms of the financial construct and infrastructure of this country. And while meme coins certainly have a place in the ecosystem and a healthy place for sure, we have much, I would say, broader ambition in terms of changing the infrastructure and the foundation layer of how assets move in the country. So I just probably don't want to have my picture online in a variety of ways, you know, maybe probably me even being from Quebec next to poutine or something like that.

28:51 when you're trying to be taken seriously with the big banks and government in terms of shaping the future of finance. So that's my answer. There's a time and place for that. There are great people in Canada that are really good at this stuff, but it's not Tetra's bread and butter.

29:09 I understand that. I get it. Here's my position. I'll just say it in the sense that there is a next generation that is coming, and they are the king of memes and the queen of memes. They're coming fast and they're going to get a lot of this wealth handed down to them. And they are going to go with the players that are playing in the game. So I'm just going to leave it there. Hopefully we'll see you there in that game in the arena with the rest of that. So it's going to happen. So anyway. Didier, it's been good talking to you. We've learned a lot about what you guys are doing. We'll keep a very close eye on what Tetra is up to with CADD.

29:47 So thanks for coming in today. We appreciate it.

29:49 Thanks so much for having me. It was a great pleasure.

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