Matt Huang on Tempo, Paradigm's evolution, and his early ByteDance bet

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Great to meet you. Have a good day.

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Let me tell you about the New York Stock Exchange. Want to change the world? Raise capital at the New York Stock Exchange. And let me also tell you about Gusto, the unified platform for payroll benefits and HR built to evolve with modern small and mediumsiz businesses. And without further ado, we have Matt Wong from Paradigm in TV. How are you doing, Matt?

What's going on?

What's up, guys? How's it going?

Great to finally have you on the show.

Yeah, fantastic.

Longtime listener, big fan.

Appreciate that. Uh, where should we start, Jordy? Should can we do a little biograph biographical stuff? Can we go back in time a little bit? get to how we got here.

Let's let's touch on tempo since we've been talking about tempo and then there's a bunch of other stuff we can talk about, but uh glad to see you're drinking a diet virtual diet coke with with John.

Yeah. I mean, I guess my question for you on on Tempo is uh it it feels like a big project. It feels like it launched very fast. Is this faster than expected? Like what were the keys to actually getting to this point as quickly as you did? Yeah, I think it's uh perhaps one of the fastest uh you know projects start to mainet launch.

Yeah.

In crypto.

Yeah.

And it certainly was top of mind for us to move really fast. I think the genesis of the project was around noticing the problems that existing infrastructure had serving all these stable coin use cases

and we didn't want to wait around for many years.

But certainly you would have seen the opportunity before August of last year, right? like it's not like you weren't thinking about AI or stable coins or anything. So, so was that like somewhat of an intentional strategy of like, hey, we need to build a really strong thesis of of how this market is going to evolve and it we shouldn't just like rush in launch something and then go through kind of wandering in the wilderness to then get to the point where you could launch something to mainet.

You know, you're ascribing a lot of foresight. Um, candidly, I mean, obviously we've been paying attention and investing and building in the crypto space for a long time. Uh, candidly, it was kind of two sides coming together. On the paradigm side, uh, we were sort of noticing the slowness of existing infrastructure and then on the Stripe side, they've been doing a bunch of great work in stable coins and were themselves experiencing a lot of the infrastructure challenges that existing chains had. Uh so we had a conversation in April about maybe we should actually get together to build something and then uh a week later the entity was formed.

Are there any other big uh like distribution nodes that need to fall into place besides having the network up and running and then the partnership with Stripe because it feels like that solves everything. But I'm I'm curious to know like what are the other uh next steps in the rollout broadly? Yeah, I think there's probably two layers to think about, right? There's Tempo, the chain,

which all the crypto infrastructure and exchange infrastructure needs to support and we have a bunch of great infrastructure partners there.

Uh then I think there's just the broader trend of stable coins.

Um like if you think about payments, I like to think about it as like a thousand or 10,000 different markets. It's not a single market. You know, there's what country does it originate from? where does it go, the size of payment, whether it's a business, consumer, um, etc. And so some of those are much better served by existing infrastructure and some of it's much worse served. And so stable coins are actually particularly good at certain segments of that kind of big matrix. And that's where it's being adopted first, you know, crossber remittances, uh, payouts. And so part of the goal around Tempo is to kind of promote stable coins more broadly, not just offer another chain.

How how predictable has stable coin adoption been to date? Like if you go back five years ago, were you pretty confident that you'd see it more in emerging markets and then and then it would go, you know, eventually to to business use cases for, you know, businesses that were operating operating internationally like uh then obviously trading use case which has been, you know, dominant since the beginning. Yeah, stable coins have been around for 10 years mostly dominated by trading and uh I think the emerging market use case is definitely expected. I mean the monetary rails and monetary units are much worse there. Um I will say we were probably surprised the last 18 months by how much it's taken off. Um, I think even the most bullish people inside of crypto, uh, maybe some predicted it, but all of us have been surprised by how much stable coins are being used outside of crypto. And that's really the bullishness that drove us to get excited about launching something like Tempo

and is the big uh is the big driver. I mean, I've heard about the like scale AI use case. I think SpaceX has mentioned a use case for stable coins. there's a lot of like crossber

deals big uh is that the current narrative or are there other uh little offshoots popping up around adoption

there probably three big buckets the first is the crossber

okay

and so that's where you have deal which sort of so many different countries and

um

Shopify is thinking about similar things and

um and then you have uh the instant nature of stable coins.

So, I mean, when you think about it, it's kind of crazy that the financial system shuts off uh during nights and weekends. Like, the internet is on 24/7. The financial system is off more than it's on.

Yeah.

Um and so I think stable coin potential is just to bring that into the 21st century where it's on all the time.

Mhm.

Yeah. And the US dollar has insane network effects, obvious product market fit, and then you're taking a product that works that that's pretty great. And then uh you know it has has some of its issues, but uh and then you just like wrap it in something that you know unlocks you know all this additional air time. And you know there is a trend in the 70s and 80s called Euro dollars which is sort of the the offline tradi equivalent of this of dollar deposits outside the US.

And that also started uh kind of illegal and frowned upon pretty small and has now grown to you know north of 10 trillion

in offshore deposits and fully legitimized uh by the US system and I think stable coins are probably on that track as well. Um, but back to your question, like the instant payouts, instant payments, I think is underrated, too. It's so it's not a cost advantage. It's more getting the money immediately and being able to spend it immediately. And if you think about a lot of these labor marketplaces, that's something that the supply side of those labor marketplaces really values.

How what how do you think the shape of the kind of issuer market evolves? Do you think it's, you know, right now it seems to be like a winner winner takemost market? Uh, but certainly a number of companies are kind of promoting this idea of like there should be millions of different stable coins. Uh, what's your what's your view? So I think um I think there's probably there's the how many stable coins will there be that are generally have some usage and like what will the distribution of volume and deposits look like.

Yeah.

And I think the distribution is going to be very topheavy just because network effects around a single unit of account and how liquidity works in DeFi and exchanges. On the other hand, I think a lot of enterprises that we're talking to own the interface that people are going to be using these stable coins through. And you can think of them in that context, maybe a little more like stored balances or gift cards, uh, where like Starbucks has a massive gift card program. Um, and it's essentially banklike if you think about it in some ways. Um, and so I think a lot of those types of financial services that are kind of hiding inside these consumer businesses will end up uh considering launching their own stable.

Yeah, that makes sense.

How are you feeling about the regulatory environment? It felt like 2025 was a great year for just getting clarity around where crypto was going from a regulatory perspective. Has that trend continued in your mind? Are you happy with where things are? Are you optimistic for new regulation or less regulation or any changes? Uh just what's your read on the regulatory environment right now?

I'd say we're in the top 1% of universes that we could have hoped for. So things are going well.

That's amazing.

Um like the Genius Act passed, that's been huge for stable coin adoption. Obviously, stable coins were growing even before that, but a lot of the enterprises we talked to, they weren't really comfortable participating in stable coins until the regulatory clarity.

Uh the next stage hopefully we get market structure or the clarity bill passed as well. There's some uh kind of last details to work through between the banking industry and crypto. Uh but I'm feeling optimistic that we can hopefully sort through that. Are you a believer in stable coins to the degree that you'd put your own fund capital in stable coins?

Uh well, yeah. Uh tempo tempo would not be the the best place to hold stable coins if we weren't comfortable fooding.

Yeah. But is there is there actually a future where stable coins wind up showing up in venture capital? Uh well stable coins I think will be you like as a as a cash instrument I think for sure.

Yeah.

Yeah. Then you don't have to I mean you can do instant capital calls uh when you sign the term sheet at 9:00 p.m. at night. You don't have to wait till the next day.

That actually pretty bullish. Uh take us back through some of the previous uh investment uh experience you've had. Uh there was someone in the chat asking about uh your early fund one investments. uh very heavy on Bitcoin and Ethereum. Uh can you tell that story of what that was like from a risk perspective? What actually played out there? Yeah, when we launched Paradigm in 2018, I mean a lot of our thesis was we knew that crypto would expand massively and then there was this open question should you invest in the core protocols uh like Bitcoin, Ethereum um or invest in startups and obviously in hindsight the answer was both like you could own Coinbase and Bitcoin. Uh but I think it's a lot like the AI landscape now of this question of do you own the model companies or do you ownation layer on top?

Yeah.

Um and so in 2018 like Bitcoin and Ethereum were like open AI and anthropic and those are the things to own and uh we sort of were thinking much more bottoms up about what we wanted to own for 5 to 10 years uh rather than like is this too much in one investment or it happens to be a publicly traded thing. Yeah,

those are all details.

That's so such an interesting comp because I feel like you can almost think of like L L2s.

Yeah.

Like and and comp those to like cheaper, smaller open source models today where like L L2s have been, you know, great in in some ways but also kind of threaten uh the the the revenue stream of the underlying protocols at points.

T me back to the bite dance investment. Was there a similar thesis around uh should you own Bite Dance or Facebook or something and in reality the bet was to own both? Um what went into your initial investment? Take me through the thought process for that one.

Uh you know I wish I was that thoughtful back then and could claim some some kind of genius.

Yeah. Uh, but I was just very lucky to meet the entrepreneuring

on a trip. And you know, he's just one of those people you meet that jumps off the page. And I'm sure you guys have had this experience. And I was going to give him money even if he was building a hot dog stand.

Sure. Sure. What was it that stuck out? Just the conversation, the level of detail, the technical side, the EQ, IQ, like how were you evaluating him at that time? Well, it was a weird conversation because he was I don't really speak good Chinese. I can kind of stumble through uh ordering dim sum.

I I don't speak good Chinese either.

And and he didn't really speak good English. So through a translator

Yeah. Um, but you know, he's one of those entrepreneurs that like seems very thoughtful, academic, highly technical, but then in the revealed nature of his actions is just like extremely hyperaggressive. And I think a lot of

Yeah.

Uh, some Silicon Valley entrepreneurs look like that too in a great way.

Yeah. Yeah. No, I I I'm thinking of a number of of uh of CEOs we talked to found Patrick at Stripe. I was I was going to say yeah exactly where where they have one demeanor one level of they can communicate about the technical side of the business very thoughtfully high EQ but the level of ambition is just unlimited and that's it just seems like uh such a rare combination but when you find it you got to go all in.

How should people think about paradigm today?

That's a good question. Um so you know we've spent a lot of time uh in the crypto space and increasingly as crypto goes mainstream

we're finding that distinction to be a little less uh meaningful and there's a lot of interesting things happening in the world. So,

uh,

yeah, like it was it was it was entirely right to be entirely focused on crypto in 2018.

Mhm. And then as the technology diffuses, you realize like, hey, there's a lot of other businesses. And then you also have to follow your own personal interests. And I and I feel like if you're if you're, you know, uh, logging off and then thinking about, you know, biotech or or AI at a certain point, like I think the best investors like follow their obsession. So

yeah, and don't get me wrong, I think crypto is still one of the most interesting frontiers. It's finally winning. uh it's getting mainstream, it's getting integrated everywhere.

Uh but AI and many other areas are also super interesting.

And I think a paradigm today is a lot of the team we've assembled. I mean, you just spoke to the our CTO.

Yeah. and um you know he found out like what a balance sheet was somewhat recently uh and like is not a typical GP or investor at a fund but everyone at the fund knows how to code and is in kind of some kind of CLI tool all day and the team really embodies this hacker ethos that lives at the frontier and we want to be spending time anywhere that is interesting at the frontier. Mhm.

Is this the best time in history to be that hacker archetype?

I think so. It's like the joke that there's a billion dollars stuck in your laptop. You just need to press the right keys to extract it out. And I think that's never been more true with the leverage of intelligence kind of on tap.

Yeah. No, I completely agree. Uh what a time to be alive. Well, thank you so much for taking the time to come chat with us.

Yeah. Great to finally have you on. Have a great rest of your day.

Yeah, excited to uh watch the roll out. We'll talk soon.

Talk to you soon. Goodbye.

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