Shan Aggarwal on Coinbase's expansion into tokenized assets and its ambition to become a full-stack financial institution

to this front page news about stable coins. Wall Street calls for stable coin rethink as friction with crypto industry builds. There's a loophole on industry yields apparently. We're going to dig into it. He's in the reream waiting room and now he's in the TDN Ultradome. Welcome. How are you doing? Good to see you.

Hey guys, I'm doing great. Good to be here with you. The chief business officer. It's a great coolest title. The coolest title. It's the vast. Uh anyway, uh give us a little your background and and what you're working on. What's the most interesting thing in your world these days?

Yeah, first off, uh congrats on 100K pump for you guys in under a year. That's huge. Um you know, we're just trying to keep up with the crypto charts here. Yeah.

My background, so like you guys mentioned, I'm chief business officer at Coinbase, so I oversee uh the broader company's uh strategy, partnerships, M&A investments, and a handful of other things. Um, I actually started out my career uh wanting to be a a brain surgeon. So, I studied neuros neuroscience at UCLA.

Uh, realized like late in college that uh I had a a big enlightening moment which was that I uh fainted when I first like saw that much blood up close and I realized like, hey, this isn't going to be the thing for me. I ended up uh working in strategy consulting.

I know you guys have been talking a lot about Intel and semiconductors today. Those were like some of my early clients there. Uh we're doing a lot of due diligence for private equity firms and the like. And um were you pounding the table saying go Pure Play Foundry in 2019?

Not quite like Ben Thompson just wrote about it. We got to implement this. Yeah, exactly. I don't know if you had the same clout back then. Well, fortunately, yeah, after the consulting thing, you know, I wanted to get more on the uh the right side of the table in terms of allocating capital.

So, I worked in uh in venture at a a fund called Greycraftoft. Uh we were actually based down in the arts district, John, down the street. I've been to the office. So, uh yeah, we were early movers there to the east side of LA. But uh yeah, and then I jumped on Coinbase in uh 2018. So, yeah.

So, take me through the recent uh the recent history of your work at Coinbase, what you're focused on, what uh what is moving the needle for Coinbase and kind of this uh this next phase. is it's obviously a very scaled company.

Um, but it's one of the it has to be one of the largest founder mode financial institutions now.

And I'm starting to stop thinking I'm thinking about it less as like yeah, it's the place where you buy Bitcoin and more just like it is a financial institution that does a lot of things and potentially will do kind of everything in the financial world over the next decade. And that's and been extremely inquisitive.

Yes. So yeah. Yeah. G give us a give us a whirlwind tour. Yeah, totally. I think two primary dimensions. So historically, like you mentioned, I think Coinbase has primarily been known as this place where we make it really easy and secure for people to buy and sell crypto assets, right?

Uh and uh people know us for the first party applications, the Coinbase Blue app, which has been great. Uh but we're broadening that out now to support a wide range of different assets. I I think fundamentally it's driven by we think that all assets are going to get tokenized and be onchain in some capacity.

It just provides better infrastructure for uh financial transactions. And so we we announced pretty recently that uh you know for the first time Coinbase is going to be building what we call the everything exchange and supporting uh things like equities, prediction markets.

Uh we opened up uh through the Coinbase app now that you can uh trade assets directly on dexes.

M so uh in general what we see is basically the blurring of these lines between what was offchain and onchain and uh we want to make a very simple and seamless user experience for people to uh access the all of these assets that are going to be onchain. So that's yeah go ahead. Yeah. Yeah.

I mean in in general um super on board uh I feel like liquidity just lowers cost of capital allows businesses to do more impressive things. It's it's good. Obviously, there are areas where um I I'm particularly thinking of like stocks on chain.

There's situations where like I don't know that I'd want someone to be trading shares in my company all the time. So, how are you thinking about that market evolving?

Uh obviously there's a huge benefit to getting access to capital without some of the over like the the the cumbersome nature of the like reporting constraints of going public and all the all the different issues with floats and IPOs.

Um but how are you thinking about the the the the path to bringing more assets on chain? What's the most logical and then what's further out on like the the long long time horizon? Yeah, I think it starts with the regulatory front and that's where we see like the biggest uphill battles.

So, you know, uh right now it's sort of like invogue to talk about tokenized stocks and the theme of tokenization and tokenization isn't really anything new. You know, when we co-founded USDC in 2018, that was it's a tokenized dollar, right?

Like it is a dollar on a blockchain and at that time people were sort of like what is this thing good for? But now they realize like hey you have uh all these benefits that are just uh come with the asset when it's on chain. So you get programmability, interoperability, global access, all those types of things.

So public stocks that's this is like the the new thing that people are really excited about and we're really excited about it too actually.

You know, in 2021, I was helping take the company public uh uh through our our direct listing, and we actually explored uh issuing a tokenized version of coin Coinbase simultaneous with the uh exchangeel listed version of coin.

And you know, that was always the dream where you could basically have an a user that holds the asset onchain and if they wanted, they could redeem and hold the asset on NASDAQ or go vice versa depending on their preference.

M and we just ran into uh a number of different regulatory blockers in 2021 where we realized that wasn't possible. And so I think the regime change in 2025 makes it uh much more collaborative.

There's uh a very healthy birectional conversation that's ongoing around you know what are the uh rules and requirements for an asset that's traded on chain. Do you need to be does it need to live in in the environment of a broker dealer in a national securities exchange or does it not?

Uh so we're really excited about um the regulatory environment progressing with uh the benefits of the technology. Is there a great argument right now that you've heard for uh how like your average American benefits from stable coins? Because I I I've I've literally paid people internationally in stable coins.

It is amazing. And if they don't have access to dollars otherwise, like in a high inflation country, I totally get that.

Um but is there a way to contextualize it for somebody who isn't doing any international business and is America is is an American like what what are the benefits uh besides like you know programmability abstractly?

Yeah I would say right now most of the benefits are really crossber transactionoriented but like you know the one that I think will resonate with a lot of people who are Americans even is you know if you're hiring freelancers or contractors around the world like how do you get them money?

uh these are people that you might need for like a one-time job or for like just a few weeks. Uh it's a lot easier to do that and uh you know we have a partnership with Stripe where Stripe is enabling stable coin payments through USDC on base and uh one of Stripe's key customers is remote.

com and they start to see that this is just a naturally native better way for small startups and founders in the US to pay freelancers regardless of where they are in the world.

Do you think that uh with like the freelancer are they more just excited about getting dollars or do they actually care a lot about like the yield that comes from treasuries and all of that because it feels like they're they're both important but I have trouble waiting them like what do people care one obvious benefit is just getting the money immediately versus having to wait days potentially 10 days just get your money even after the client has hit pay.

Yeah. Yeah. I think the thing that has become clear is there is just insatiable demand for US dollars around the world. Like everybody wants US dollars but it's really difficult to access US dollars to. So, John, I think to your first question, the the pain point is really I want dollars or a safe, stable currency.

And then, Jordy, to your point, it's like I want it as quickly as possible uh in a in a form factor that I know and I trust.

And uh you know, we started to see this kind of organically a couple years ago where a lot of people in Argentina and a lot of other countries were just like natively finding their way into uh dollars, stable coins. And in those countries, you know, we we spoke with a lot of customers and it's it's normal, right?

Like you look for different stores of value, whether that's, you know, buying real estate in the US or gold or Bitcoin and stable coins are just a a natural and uh more relatable form of store of value for a lot of these people. Yeah.

Can you talk about the significance of the Darabit acquisition that you guys just completed? Yeah, we're really excited about it. We just closed it. For uh context, Darabit is the uh world's largest crypto options exchange.

Specifically, they've had about 80% market share in crypto options uh for the last 8-ish years or so. So, kind of like up and down through the uh various crypto cycles. And in in the crypto markets, uh derivatives are orders of magnitude larger than spot markets.

Coinbase kind of grew up and got its uh foundation and its roots in helping people seamlessly go from fiat currency, primarily US dollars and euro and GBP into crypto. Uh and the derivatives markets have have just sort of like ballooned in size.

So over the past year or so, we've made a big push into the derivatives markets. Uh we have uh exchanges in the US and internationally that support uh a handful of products. But Darabbit really for us brings us market leadership in this options category that we think is going to grow tremendously.

It's also a differentiated capability that uh will basically pull together spot options and futures as different trading products together into one exchange uh platform. And what that does for users is really two things. One is it creates new trading opportunities.

A lot of people will like uh buy spot and short features and you can do that now across more more instruments just on one place. Um and then the second thing is it unlocks more capital efficiency and this is really a key one is whenever you put on let's give it up for unlocking capital efficiency. Love to see it.

Doesn't get better than that. Yeah. Uh whenever as you guys know it's like how do I get the most bang for my buck quite literally right?

So if you can trade across all those different assets, you hold $1 or one crypto asset with Coinbase, then you basically can get margin and cross margin across all these different products with that $1. So it's it's just a better trading experience overall for uh for people who move in size. Very cool.

Let's hear for people. Let's hear for people that move in size. Play the eagle sound. There we go. I love it. Thank you for coming on. You're always always welcome. Yeah, anytime. We'll talk to you soon. And congrats on the on the new title. Well deserved. Well deserved.

Up next, we need to we need to we need to make somebody the chief business officer here. Yeah, it's up. Simply too good. Tyler, are you going to take it? You're going to take it? You're the chief. Chief intern officer, the CIO. CIO. But you know, any day now he could get promoted.

Anyway, in the reream waiting room, we have Brian Pellegrino