Stephen: Welcome to another episode of the Around The Coin podcast. I'm your host, Stephen Sargeant. Today we have Angie Walker. She's the commercial head of Apex Digital. They've come out with their 3.0 platform that's bringing all asset classes, tokenizing them, bringing them on chain, and making them available pretty much 24/7.

This was such an interesting conversation because Angie has such great experience working with R3 in the early days in Corda, working with chain links, and as well as bringing her traditional knowledge to such a complex digital asset space. We cover everything including real world asset tokenization.

We talk about regulation, what's happening with jurisdictions that are now evolving into stablecoins and their new stablecoin as a service solution that's offering issuers an easy way to do all the backend and administrative processes that's bringing stablecoins into 2026 and beyond.

We even get to talk to her about the Apex Invest Summit that they had in September where they brought some of the biggest industry thought leaders into this space to talk about the future of on chain assets.

This is such a creative episode. Angie's a wealth of knowledge and you will absolutely be more educated on asset tokenization after listening to this podcast, and she even gave us permission for you to reach out to her directly at Apex Digital.

This is a must watch episode. I hope you enjoy.

Stephen: Welcome to the Around The Coin podcast, Stephen Sargent live from Toronto, speaking with Angie Walker. You're the commercial head of Apex Digital. Why don't you tell us a little bit about what your background, Angie? Then we're gonna get into everything that's happening in tokenization, stablecoins, digital asset infrastructure.

We have a lot to cover in 50 minutes, but I'm excited for you to share the audience your journey up until this point in crypto.

Angie: Okay, awesome. Well, it's great to be with you, Stephen today, and thank you very much for inviting me. So Angie Walker, I run Apex Digital Commercialization and Business Development globally.

I've been with Apex for about three months, so it's very early days for me in the world of Apex. Uh, prior to that, I spent the last eight years in blockchain and DLT, uh, with, uh, R3, uh, working on quarter in the very early days of innovation within financial services. Um, from 2018 through to 2023, and then I spent two years after that with Chainlink helping Chainlink to set up their franchise in banking capital markets.

Um, before all of that, I spent 20 odd years building, um, financial market infrastructures and front office trading platforms globally, primarily around listed equities and listed derivatives, listed securities and derivatives. So, spent my whole life. In banking and capital markets, trained as a nuclear physicist.

Decided I didn't like that, and moved into financial services and I've been there ever since. It's, uh, great to meet you.

Stephen: Awesome. I'm curious.

R3 was probably one of the most revolutionary products when it came out, but it was also met by a bunch of bear markets, financial institutions kind of opting in and opting out depending on the volatility of the Bitcoin prices.

Can you talk us about the early days, like what was the evolution of R3 and then maybe even, you know, touch on where it is today?

Angie: Sure. Well, I, I can't, I won't comment Celeste about as much about where it is today because I'm not involved, uh, uh, directly. But cer certainly if you look at R3, I mean, I was there for six years.

I was probably there for the, uh, the most exciting period of R3's existence. It was founded by David Rutter and two of the colleagues. And they, they raised, um, actually incredibly. Large, a round 117 million, um, across 42 banks. They had global investors. It was a very impressive cap table they had. And that, that added massively to the things that we achieved in that period of time.

Um, they built, um, originally they weren't sure what they were gonna be building. They, they been brought together to try and work out what was blockchain all about. What, you know, what did it mean to financial services? What could we do with it? Was it, was it actually gonna have a purpose in our lives? And that was why they raised that money because they realized very quickly that it was going to be significant and, and therefore they believed that they needed to innovate in order to discover what we could we use from a regulated market perspective.

And about two years into that journey, we launched Enterprise Quarter, uh, which we be around the end of 2019 maybe Enterprise came out. We did an open source version in late 2018, but we went enterprise in 2019 and we did some amazing projects. So I was very privileged to be in SDX with six group in their six digital exchange right from the very beginning before they even had furniture in the building.

Um, we all sat round a sort of a dining room table. Um, in the original design phase of SDX, it was very impressive and we, I went all the way through that journey all the way through to when they went live, eventually back in 2021. And I was also very fortunate to be involved in the design team and the implementation of the DFMI, with Euroclear, the digital financial market infrastructure with Euroclear, both of which were built on quarter.

Both of which exist to this day in a live and production environment. So Cord had a very important role to play. It was, it helped people in the early stages to get, um, to grips with 'em, feel comfortable about decentralized, um, uh, technology, decentralized ledgers. It was a very. A private and very permissioned ledger.

So it was only there for actors and participants that we knew who they were and uh, and, and you would only be able to interact with any applications on the ecosystem unless you were a known counterparty to that particular group or that particular application or ecosystem. So it had very, very heavy permissioning.

It had very, very heavy privacy capabilities, and it was a very secure environment. But it was also because it was very heavily permissioned and very. Uh, private, it was also a little bit closed, and so it made it difficult for, um, applications talking inbound into that DLT environment to be able to interoperate easily.

Um, it was also built on a, uh, on a platform, uh, on a technological called UTXO, which again made it, um, difficult to interact with it. Uh, if you were building on. Traditional sort of EVM Ethereum based technology, um, because those two state models don't interact very easily with each other. Um, so over the six years that I was at R3, we did some amazing projects like the Euroclear project, the DFI, like the, uh, project we did with SDX, and, and I was very.

Happily, uh, very ha. Happy to be involved in all of that. And we did, um, the first ever collateral mobility project with Clearstream and D in their D seven, their digital environment, uh, with HQLX. We took that live back in 2019, I think it might have been, or 2020. And that was where we took, um, high quality liquid assets in baskets and we created what was called a digital collateral receipt that pointed back to the underlying basket, which was lodged with the custodians.

And the custodians when we took that live, were Clearstream and Euroclear. And then they obviously expanded the custodian, um, population out and they also expanded the number of banks that were, uh, participants within that ecosystem. So I think they've now got a very impressive group of banks that exchanged downgrade and upgrade collateral.

In real time via the UEX repo market, um, using these digital collateral receipts. So there's some of that very early innovation was very important because although we are less interested in private permission ledgers today, um, actually it helped us to prove out some of the use cases that are now really starting to gain momentum in, in the current world.

So it had a very important role to play, even though as a technology platform, it's now, um, pretty much come to the end of its life.

Stephen: Is it funny to kind of look back then and then seeing the, you know, the financial institutions that are entering the space now and kind of toting this innovation flag when you're like, yo, we were doing this like eight years ago.

Is it kind of funny to see the evolution of the industry and to see, you know, more traditional institutions finally getting into crypto and going all the way now into like staking on Solana and these, you know, more DeFi related projects.

Angie: Um, so no, it probably isn't. The reality of the situation was the technology was never the thing that held back the adoption.

It was the regulatory landscape and people's appetite to want to take things into production off the back of that regulatory landscape. So I think the technology itself has been very mature for a number of years. Um, I'd certainly say since 20 19, 20 20. Both private permissioned and public permission chains have been in reasonably good shape.

They're very, they're very secure. They're very scalable. They're, they're robust. So I think we've had a good four to five years where the technology hasn't been the limiting factor. I think the regulatory landscape scape has been. Very, um, has been very asymmetric and that has made it very complicated to launch with scale.

Some of these use cases, cases across jurisdictions, and I think the really big limiting factor is the lack of cash on chain, and obviously as we move towards licensed stablecoins. We're able to put digital money onto the chain in the form of a stablecoin and in some jurisdictions in the form of tokenized deposits and CDBC.

Um, I think the ability to now facilitate the movement of the cash as well as the movement of the asset has enabled these production grade use cases to start to gain momentum. But without the cash, it was very difficult because all of that would then have to be facilitated as an off chain workflow.

Stephen: I'm curious, you know, you've launched Apex Digital 3.0, which is really bridging that gap between what you're just explaining, right?

The traditional players that have been on the sidelines and now they're coming into the asset tokenization and being able to do that skill. What is the gap that you and your team saw in the industry, especially when it comes to RW, A real world asset tokenization that allowed you to fill this gap with Digital 3.0?

Angie: So it's, it, I guess it happened or it evolved in a slightly different way. So if you think about Apex heritage, they are, you know, uh, getting close to 4 trillion of assets under administration. They've always been very dominant in the private market space. Um, and so they've been. Providing for over 20 years now to transfer agency, fund administration, corporate services, Manco, um, and they've even got a, a bank in Luxembourg.

So they've got a very, very extensive and very well matured, operate model around the fund administration space. Got over 10,000 customers. So if you think about that engine room, that's, that's a lot of capabilities that were already incredibly well established. They're the most, the biggest independent TA in the world, basically.

And what we are able to do is effectively think about it almost like a, an uplift. We've uplifted that service. So we, we were, we, we are in a very, very fortunate place. That we were able to layer on top of all of that the ability to tokenize assets and then continue the journey of that lifecycle using our existing transfer agency and fund administration.

So the tokenization, which is at the front of that process, primarily around, you know, the representation of the asset in a digital form natively or potentially a representation of a record of the asset in the digital form, um, effectively precedes all of the other service lines that we have today. So we've launched.

Apex Digital, we're able to tokenize, uh, share classes within a fund. We're able to tokenize entire funds. Um, we already provide and have done for 10 years. Um, asset servicing for fund servicing for, uh, crypto funds, for example. We've been doing that for 12 years already. Uh. We've been providing middle office and treasury functions and reporting for stablecoins for about two or three years.

We just don't tell anybody about it. So we've uplifted that as well. And so where we are today is we, we, we are effectively as of the beginning of next year, we're going live with a 24/7 operate model and a support model for all of our, uh, fund servicing business in the tokenized form. And why that's important is if you look at where the market's going.

The market is going towards this ability to be able to subscribe and redeem potentially in near real time or real time, and that's very relevant when you start to think about things like money market funds. So if you're tokenizing a money market fund, you've got to be able to have a subscription and redemption cycle that has a very high velocity.

Because the people who are investing in those funds have an expectation. They want to be able to get in and outta those funds in real time. So what we've done is we've taken very well industrialized operate model within Apex and we've lifted it up so that we can actually now run that operate Model 24/7 from a TA perspective, and we can support that from a fund administration perspective.

In a real, on a real time basis. So they're constantly monitoring the, the, the, the assets that back these tokenization, the, the, these, uh, money market funds, tokenize money market funds to make sure that, that, that, that everything is in sync with respect to the custody of the assets. Versus the actual tokens that exist on the chain.

So, and the same applies to stablecoins. We launched our stablecoin as a service offering recently, and again, we are running that same 24/7 3 6 5 model, including the on-ramp and the off-ramp to fiat for stablecoins that we are running for money market funds. So I think what we've been able to do is take what is a very established.

Operate model and a very established, um, global footprint of regulation. We are licensed in 50 countries. We've got TA licenses in 36 of those already, and so we operate on a global basis and we've been able to lift that and extend those licenses into digital TA licenses in many of those jurisdictions to be able to offer a end-to-end digital service on top of the preexisting service offerings.

It been. It's put us into a very unique position where we can go to any of our clients today and we can offer a full end-to-end tokenized fund service offering.

Stephen: What's the most common use case? Like who's the customer that's gonna be banging down the door that's already using your services that were like, been dying for this tokenization and the ability to operate 24/7, which is, you know, many in the financial products.

Uh, maybe not the traders, but that's their dream is to be able to access the markets on a 24/7 basis. And then, you know. The end of the trading day is usually what is needed for a reset. What happens when we get into a 24/7 nature and there's not that end of a day and everything's constantly happening.

Is there any side effects or challenges with that?

Angie: Yeah, so the, so answer your first question, Stephen. The customers aren't a combination of existing Apex customers who want to go, who want to start their own digital journeys, and that's, that's, um. That's very, very, um, that's, uh, a very significant community of people.

I mean, apex has got a huge customer base. It's got about 10,000 customers globally. But the point is, what's happening is the market shifting. So if you actually look at the traditional market, it was, uh, you know, a lot of the investments were sat around the securities market combination of equities and, and bonds, for example.

And if you look at the, there's a shift away from that. Ratio ratio much more towards private markets. So the, typically the holdings in private markets, in the wealth sector were relatively small. They recognize the demand of their investors, means that they have to uplift their investment in private markets.

And we are, you know, dominant in private markets. And so there's a very big gap, appetite to increase the holding in private markets from somewhere. Around 5% to something in the region, 15 to 20% over the coming years. And that was, I mean, that's been very evident over the last 12, 18 months. And I think Larry Fink referenced that in his chairman's letter to his shareholders earlier this year, that private markets will become an increasingly important part of the holdings.

A lot of, a lot of these funds going forward. But also there's a very big appetite too. To do things in a digital form and in a tokenized form, and that's for two or three different reasons. There are different drivers, one of which is by tokenizing a fund or even tokenizing a share class within a fund.

What you are then able to do is fractionalize that share class and what that. The impact that has is it lowers the barrier to entry. And so if you, um, listen to, um, uh, you know, some of the people that have done this already, what they've actually been able to do, um, is they've been able to, uh, Victor Young actually describes it from Hamilton Lane very well.

He's been able to lower the barrier to entry and that democratizes the fund so that you get a much broader audience investing because. Suddenly that fund is accessible to a much broader community of investors than it would've been previously. So tokenizing and Fractionalizing really widens the audience because it lowers the barrier to entry from anything that could be as large as a million dollars down to as little as 5,000 bucks, right?

So that's very different. The other two things that it does is by putting things on chain. You are able to broaden the accessibility to the fund. And so you are broadening your audience because you are decentralizing, uh, the, the distribution of the fund and making it available across a wider community.

And the third thing is that you can then start to look at assets that sit outside of traditional capital markets. And, and that's true of a lot of private markets, so we have. Very significant assets under administration in private equity and private credit in venture capital in real estate. Um, you know, in data center financing, there's a broad spectrum of asset types that sit outside of traditional mainstream capital markets that allow investors to have a much more diverse.

Um, portfolio of investments and if you look at the investors of the future, the sort of the Gen Zs and the Gen Ys, uh, that are now, uh, coming into a tremendous amount of wealth that's being passed down through the generations, around 85 trillion coming down through the generations, over the coming 20 years, then they've.

Their expectation of their, of their portfolio is far more diverse than anything we would've experienced when I set my pension scheme up 25 years ago. So there's a number of reasons why tokenization is really important. It gives much broader access. To the asset class coverage, it gives you a much greater reach in terms of the community that you are reaching with your assets as a fund manager, as an issuer effectively.

And it also allows you to fractionalize to reduce that barrier to entry. Um, and these are all really important factors. Which are, which are, are, are, are sort of, if you like, meeting the increased expectation of the investors that are coming in into the, into the market today, who expect to have a lot more control, not only over the asset class coverage, but the composability.

How do you manage 24/7, which was your other question. You do, you're absolutely right. It is, it is very likely that there have to be periodic, um, if you like, sort of, um, halts in the process. It might well be that, uh, certain issuers might choose to say, we're online 23 and a half, seven, or, you know, whatever it is they choose.

Because there has to probably be, for most organizations, a period of say 30 minutes a day or whatever, where they reset their end of day before they start their next day. And there, there is actually, to be fair. A period, um, around the middle of the night, sort of 3:00 AM to 5:00 AM UK time where there is, I think most of the markets are closed.

So there is a, a natural period during which most markets are closed anyway, but I suspect most people that are operating, uh, on a, on a sort of follow the sun basis, will probably choose to have their daily reset, probably for say 30 minutes or 15 minutes. Um, you know, during the least active market conditions on a global basis.

So. It just depends on what, how you manage your mid and back office. Really.

Stephen: That's a really great point. That there's already these natural resets baked in. Yeah. You mentioned data centers, especially with ai, that's, that's huge. I was listening to a podcast where the CEO of Carta was talking about, you know, they specialize in cap table management, and the host, Gary Vaynerchuk was talking about the blockchain and how the, you know, do you think this is the way equity is going to be shared in the future?

That everything's gonna be tokenized and you know it's gonna be on the blockchain?

Angie: Yeah. So if you look at, so cap table, I mean, blockchain as a, if you think about that, that sort of, that, that golden record, the unified golden record or in, or what we used to say in my old R3 days. What, uh, Bob and Alice, what I see is what you see.

The, the wonderful thing about holding information on chain, particularly unified Golden Records, is there is only one version of the truth. Uh, and the reason that having a cap table. On chain is very, uh, compelling, is that as you move an asset from one owner, the asset owner to the asset investor, you can immediately atomically update the cap table.

And so instead of historically, uh, an asset changing hands in one application and then the cap table being managed in another application, and I dread, and I, I dread to say, unfortunately, in many instances, that was in the form of a spreadsheet outside of. Public listed markets that was not in public listed markets.

Um, but the point is, you know, on a, on a blockchain that that record, the registry of the holders of the asset is updated instantaneously as the asset moves from the asset holder to the asset investor. And so blockchain is very well suited. To holding that record of ownership on an immutable basis. And as I say, everybody's looking at the same version of the truth.

And so long as you've got the appropriate level of access and privacy layered on top of that, um, relative to the application you're working on so that somebody can't just come along and change the ownership from one person to another. In some sort of erroneous fashion. Then actually blockchain I think, is extremely well suited to things like cap table management.

And in fact, in our nominee structure, we spend a lot of time, you know, effectively representing the interests of a, a Apex Nominee Services represents the interests of many investors through its nominee as a single entry into the fund. Um, uh, uh, which is represented under. Our nominee service, but sitting behind that can be hundreds or thousands of investors.

So I think it, it is a really good use for blockchain, um, both in terms of the registry, but also in terms of the instantaneous movement from one asset owner to another asset owner in terms of updating that registry.

Stephen: I love that you mentioned, you know, regulations being really one of the key challenges over the last few years and really getting to the technology that's always been there to the financial institutions that probably could use it the most.

And then to your point, gives access and democratization across these, you know, new asset classes. Obviously we see what's happening in the US. What are your thoughts around regulations? Does this benefit a, a organization like yours that's used to being, you know, under high, highly regulated circumstances and now you just have to flip on the Genius Act and you're like, Hey, we know we follow these rules all the time.

In traditional world, this is easier for us. Versus maybe a lot of these, you know, crypto native companies that aren't used to this regulation are really struggling with some of the regulations.

Angie: I mean, the regulations are absolutely vital. And if you actually look at the territories in which, um, there's been the greatest level of progress in terms of innovation within, uh, blockchain and DLT, it's typically been the jurisdictions where.

Where the regulators have been very progressive. So if you think about Switzerland, which was the birthplace of crypto apparently, um, I'm sure it was. Um, but, but if you look at finra, which is the regulator in Switzerland, they are extremely progressive. I mean Switzerland, um, has been, you know, has been very progressive in its use of digital assets.

It was the, the SDX went live with a fully fledged exchange and CSD on chain, and that's over five years. Now since they went live, if you look at SN b Swiss National Bank, they, they, it started issuing CC wholesale CDBC on chain over a year ago. So where you get these jurisdictions that are very progressive from a regulatory perspective is where you tend to get these sort of nucleis of activity from an innovation perspective.

And the same can be said if you look at, I mean, I'm picking on the UAE. The UAE has gone through phenomenal change. In one year, they passed no less than 41 legislative changes in 2022 to prepare themselves for wholesale CDBC and retail CDBC, uh, which went live at the end of that year. I mean, that's an incredible lift to make 41 legislative changes in one year in preparation for launching Central Bank Digital currency.

They've now got stablecoin licensing and that's been available now and. They've taken their first and they've issued it to their first four customers. So you look at individual jurisdictions, and, and same can be said for, for Hong Kong, for Singapore, for Japan, um, you know, but one by one, these jurisdictions are coming online Now, why the Genius Act was so important was because the US by virtue of its power within financial, uh, systems globally.

Was always gonna have a great deal of influence over other super regulators, the world over. And so once we had the genius Act, what I think that has done this, you can see that here in the United Kingdom, it's, it's become a catalyst to move some of the other super regulators forward that had probably fallen a little bit behind the curve.

And so we are seeing a lot of activity in other jurisdictions now, uh, and I think a lot of them will fall in line. Off the back of the, uh, regulatory framework that's been introduced through the Genius Act. And then hopefully very soon we'll get Clarity, the Clarity Act as well for digital assets. Um, so that's good.

There is still regulatory arbitrage because you've got, still got asymmetry, uh, between various jurisdictions, but I think that arbitrage will, will diminish over time and it will make our lives a lot easier with respect to scaling up the use of. Uh, blockchain and DLT based, uh, uh, applications and use cases because we won't have to pick our way through this sort of minefield of, well, we can deliver this service cross-border into this jurisdiction 'cause our super regulator allows it, but we can't do it here.

So if you look at some of the early stablecoin licensing, like the U-C-B-U-A-E with a Durham denominated stablecoin as it stands today. You can be licensed as a financial institution with a Durham denominated stablecoin license, but you can't use it externally, so you can't use it, for example, for cross-border payments.

Now, over time, that license will evolve and I'm sure they will bring into play the use of that stablecoin for cross-border payments. But at the moment, we are picking our way through. This sort of slight minefield of asymmetry between the various regulators. I think as that normalizes, then you'll start to see it much more scale appear on a global basis, but.

The cash element is the thing that's really escalated it. Being able to access licensed stablecoins so we can facilitate settlement, we can diffuse obligations that are being created on shame, particularly for things like delivery versus payment. Um, and for things like movement of collateral as well as a secondary market use case.

Uh, these, these are really important because they, they deliver real, um, real value in a, in a real world scenario.

Stephen: You know it, it's interesting if you know you've been around this industry long enough, especially with R3, if there was a critic or a skeptic that was severely against stablecoins or even tokenization of assets, can you highlight what you, or maybe steel men, what the biggest argument they'll have in regards to this?

I'm sure you faced a lot of these arguments within the industry that you've had to kind of maybe. Demystify a lot of people. What, what this means, what's the biggest argument for something that's against like the progression of digital assets that we're seeing in 2025 and beyond?

Angie: Yeah, so I think you, I think stablecoins is a really interesting area, and I think there've been many critics who have been very vociferous in their views about stablecoin, not least of which was the Bank of England.

I think many of those critics have seen that through the use of, so for example, we, we run a. 24/7. stablecoin administration and operations service, we don't issue, but for issuers of stablecoins, licensed stablecoins, we can operate, then we can administer 'em. We can manage the middle office and the treasury functions to ensure that the assets that back those coins remain.

Um, you know, in sync with the number of, uh, coins in circulation. So there that, so, and these, so things like proof of reserve really important. Being able to make sure that if I'm minting a certain number of stablecoins and I'm distributing that number of stablecoins. That the, the, the treasury assets that sit, or the fiat that sits.

In custody with a, with a secure custodian matches or is commensurate with the number of coins in location. So I think what we've been able to do is show through things like proof of reserve through, um, being able to implement, um, policy over the top of blockchains so we can actually control the circulation of things like stablecoins and, and also privacy, um, and security by being able to prove those things exist and prove that we can operate in a way that allows us to control the circulation.

Of those stablecoins and arguably you could even control their use through programmability of the tokens. I think regulators have come to understand that actually they stablecoins can be used in a very safe and and highly regulated environment, and they can be controlled. In their distribution and, and in their usage.

And I think as a result of that, we are seeing a number of the regulators that were very sort of stablecoin unfriendly, become a lot more comfortable with the use of stablecoins. And we've seen that in the last few days with the Bank of England be becoming much more open.

About the fact they're expecting to see stablecoins play an important part in our future, and I suspect we'll see that happen here through things like the, the Digital Security Sandbox embracing the use of stablecoins for security settlement in 2026.

So I think stablecoins have probably been ha uh. Provokes the strongest reaction.

Now, where do we go with yield bearing stablecoins? Uh, that would be very interesting and that will be the next battleground is what do we do with yield bearing stablecoins? It is coming. I mean, there are already super regulators that have published regulations around yield.

I mean, look at, uh, Bermuda. Okay? You, they already have a yield bearing stablecoins, so, you know, so yield bad and stablecoins will come. They're literally just around the corner in a number of jurisdictions.

And I think it's all about putting the right level of regulation and legislation around them and making sure that the technology and the operate model is commensurate with that and can meet those obligations.

And, and so what we are doing every day is we are thinking about from an Apex perspective and in delivering operations and services, can we meet that constantly changing landscape of obligations that, that our customers have to meet, as in being an issuer. Of a licensed stablecoin. So I think it's a really interesting part of the market and I think I've, we've seen tremendous change.

In fact, we've seen complete U-turns in super regulators who were very, very against the use of them. But now recognize that outside of the world of CDBC, which isn't gonna be here for a number of years, in many jurisdictions, stablecoins, if backed appropriately by cash or cash equivalent type instruments, like high quality liquid assets, has a very important role to play.

Um. So I think it's gonna be a massive growth area.

Stephen: You know, you know, as someone that runs and a, you know, has put a new meaning to SaaS. Right. stablecoins as a service. Yeah.

I'm curious, when you talk about stablecoin issuers, like how many of them are coming, like, I think when people think about stablecoins, they think of like TE Circle and maybe pa like, you know, uh, PayPal has what?

Like they think of a couple. How many issuers are coming to you? Is it like one, two, is it like. Ha, everyone's coming up with their version of a stablecoin for their ecosystem. Can you give us an idea of what you're dealing with from there? And is there anything that, if you are looking to get into stablecoins, it's not as easy as just saying, Hey, we offer USDC or USCT or USAT.

What are some of the considerations that you work on with these companies that make sure that, to the requirements that you're talking about that they might not be thinking about right now, they just want to catch the hype of stablecoins.

Angie: Yeah, so I think there will be quite a large number of stablecoin issues.

I think any organization that's got a significant treasury operation, um, and is, um, facilitating the movement of payments or cash, either inter entity or intra entity, um, on a global basis, probably has a very good motivation for wanting to license a stablecoin. So I definitely think you'll see a large number of financial institutions either individually.

Or in a collaborative form, um, come together to license stablecoins. And I think actually we are seeing a number of banks come together and financial institutions come together to launch things like Euro nominated stablecoins. I mean, you'll see them in jurisdictions or in groups of financial institutions who between themselves.

Want to be able to operate a stablecoin so they can move value between the walls of their own organizations and with each other 24/7. Um, but anybody who has a significant treasury operation, I think is likely to want to apply for a stablecoin license in probably more than one jurisdiction. And again, the other obvious candidates for stablecoins are global payment providers, payment service providers.

Again, I think that's another big area where stablecoin licensing becomes very obvious because you've got a frictionless movement of cash, um, on a global basis where applicable and 24/7. So I think a lot of the big payment service providers, the very, very large corporate treasuries and, and the larger the financial institutions where they're moving very significant value either.

Inter entity or intra entity with their, with our larger corporate customers. Um, so we, I think it will run into potentially hundreds on a global basis. I think it, we will in certain areas coalesce around collaboration in certain jurisdictions and around certain currencies. Um, but I think the thing that will prevail is, is a consistent model where.

Those stablecoins, particularly in licensed stablecoins, will, in their backing, it will always be either fiat or a combination of fiat and high quality liquid assets. So what we call cash and cash equivalent type instruments. And that's really, um, in order to give, you know, uh, you know, a safe, stable, well stablecoins, right?

They're stable by their very nature. They have to be backed by stable or, or high quality assets. So I think that will be a consistent model where it's backed by cash or cash equivalent type instruments.

Stephen: If I'm listening to this and you know, I'm a fund manager or administrator, this is all exciting and I have traditional financial products.

What's the fastest like proof of value from Apex Digital 3.0 that I could probably run in the next 90? Like I come to you and I say, Hey Angie, I want to do something with you. What's the quickest way, you know, the time to fund TTF? What's the, the time to fund? What is that version for your organization?

What is the time to get, you know, a potential customer excited in using your Yeah. Platform right off the bat?

Angie: Yeah, so the platform's built, it's already live. So I mean, we are doing, we, we typically say that somebody coming to us. With a new money market fund, for example, we've got quite a lot of inbound on money market funds at the moment.

We normally say from the point that we have that very first conversation, particularly for an existing customer where we've already onboarded them. So we haven't gotta go through the onboarding process with them as an entity. And there's plenty of them. There's. Obviously a large number of existing customers then we normally say to, to get to the point of launching as long as they are ready to launch.

At the point that we've actually onboarded the fund, typically we'd talk in the region of around three months, no, no more than three months, and, and it would be very rare for it to be anything much more than that maybe if they weren't quite ready. You could go a few, you know, a few more weeks after that.

But typically the process of getting from the initial conversation and as long as the fund itself has been identified in terms of its construct, then we'd normally say within three months we can have that launched and out to the market. Um, now that's probably slightly elongated if it's not an existing client of Apex.

'cause we have to go through onboarding. KYC and a ML just like any other licensed regulated organization. Um, but if it's an existing customer, it's very, very quick time to market. And in terms of the value, you think about a lot of customers that're sitting on, I mean, money market funds are a really good example, okay?

A lot of stablecoins. Are backed by money market funds, and we've got a very large number of customers who are sitting on traditional money market funds. If we tokenize those money market funds, we can then make them available for, for stablecoin operators to use as the collateral that backs the stablecoin.

So instead of the money market fund just sitting there. Earning yield based on the fact that it is a money market fund. We are now reusing that into a secondary market use case because we are using it either to post collateral, uh, to another counterparty or multiple counterparties, or we're using it to back a stablecoin, which is gonna go off and facilitate some settlement or payment, uh, objective elsewhere.

And so it's, so it's getting a second. It's earning yield in not just. By, by virtue of the underlying assets within the Money market fund itself, it's earning a second level of yield through being used as a, as a payment mechanism in the form of, I,

Stephen: I think people listen to it. They're like, yes, we, we have a, we do have a fund here.

There you go. That's collecting. Thus has yield gotten a bad stigma?

I know in crypto, you know, we're still recovering from Anchor and you know, what happened with Terra Luna? Does yield still have. A, a, a stigma to it in your side of the world in digital assets and traditional financial institutions? Or is it, you know, more common that people are like, yeah, we understand yield, we understand things like staking and protocol yield, how, you know, and people use the word like wallet and address and crypto very interchangeably.

How is yield per pervade in your industry and, you know, how do you kind of communicate that to customers?

Angie: So yield is, I mean, obviously yield relates to the assets you are working with and what you're gonna do with them. And I'm not gonna talk about staking because I think that's a long way away from where, where a lot of financial institutions are today with respect to what they're gonna be doing with their client's assets.

But I do think if you think about tokenizing something like. I mean, the reason money market funds and fixed income funds are interesting is because they are relatively high quality assets. They're fairly liquid. I mean, money market fund in particular is extremely liquid and it's a high velocity type instrument.

And the reason that being able to take that and tokenize that is so powerful is because you open up a whole world of secondary market use cases. Now that could be. Using it for, um, for unsecured financing, which brings a yield, right? It could be, I'm using it to post margin. I'm lending it to a another financial institution so that they can post margin and they're gonna pay me for borrowing that tokenized money market fund for four hours or eight hours or four days, and I'm gonna get the benefit of that on top of the yield that the underlying produces in its own right, or it could be, I'm lending it to a stablecoin issuer.

They're gonna use that to facilitate payment, and that could be like on a rolling 90 day or whatever it's they're doing. Um, so these secondary market use cases and the yield that we get from these secondary market use cases is incredibly compelling and there is no real disadvantage to not doing it.

Now, coming back the other way, the reason that's incredibly important is if you actually look at the investors of the future. So a lot of the asset managers are looking at what, what, what are the investors of the future, the average age of a pension fund holder? Probably something like, I don't know, for somebody like a BlackRock or, or one of the large, um, asset managers is probably somebody well into their forties and maybe even into their fifties.

We realize that the investors of the future are different. There's a huge, um, uh, transfer of, of, of, of wealth happening in the coming two decades. 85, 84, 80 5 trillion of wealth is gonna be passed down through the generations over the next 20 years. It's the biggest. Transfer of wealth between generations ever on record, um, at all.

And so, so the investors are gonna come be in a position to start investing much earlier in their life. Uh, so we have to think about what tools and, and in what way can we attract the investors of the future. And generally speaking, and I'm just using my son as an example because he. Day trades whilst in his fourth year at university, um, and thinks nothing.

He's got, you know, he works on two or three different day trading platforms and, and, and really is interested in nothing that's got a yield beneath 10%, which is quite interesting. So that wipes out most of the bond market. Um, and, uh, these people expect a much higher yield. And the reason that's important is because you have to, if we want to attract these, uh, the investors of the futures, the Gen Zs and the Gen Ys.

Not only have we gotta give them composability in a more diverse range of assets to invest in, but also we've gotta be able to allow 'em to, um, improve the yields. And the only way you can do that is by being able to, um, leverage these sort of secondary use cases. So I think it's really important people's expectations of what yield they're getting have.

Gone up as the, uh, as the age of the investor goes down. Um, there is a huge amount of wealth passing down to those generations now, and we have to provide much more flexible use cases and much more effective use of those assets in order to get to those yields. And that's why. Tokenizing them and making them accessible to secondary market use cases like staking, like, uh, unsecured lending, like margin posting, collateral, mobility.

These are all the ways in which we can start to push the yield up on traditional assets, um, in a way that will hopefully negate the need to get too much exposure. To, to assets that are less well known or, or a little less stable basically. So it's a yield is a very important part of what we do, and we have to think about how do we improve the yield without necessarily increasing the risk of the assets we we invest in,

Stephen: which is the ultimate dilemma in financial products, right?

Or

Angie: spread or spread risk, increased

Stephen: yield, decreased risk. And then anyone that says they do it too much is like, Hey, how? How is that possible? I'm curious though, you mentioned a couple things. You mentioned your son.

Is there any assets that you don't think should be on chain or anything that you don't think it's viable to tokenize?

And is there any asset classes or just, you know, financial products that you're surprised people aren't rushing to tokenize that, you know, still slow to gain traction?

Angie: Um, um, do I think there's any assets that shouldn't be on chain? Um, I guess the only assets that probably, um, won't necessarily effectively be a front to back lifecycle managed on chain are where you get a very, very high velocity.

So if you look at traditional FX markets, for example, I mean, blockchain isn't. Famous for its speed. It's, it's fa it, it, it's, its value is in the immutability and, and the fact that it's decentralized and therefore it can reach a very broad audience. Um, uh, but, but actually there are certain types of financial instruments that, that wouldn't, I don't think necessarily, certainly in the front office and a trading level.

Soup, blockchain, and uh, and FX is a really good example. The FX markets are very, very high velocity. They're very time sensitive, so we are talking about milliseconds and, and in certain markets even less than that. And so transacting. Um, on chain is not really an option for FX markets. Highly liquid markets, um, equities, if you think about listed, uh, you know, publicly listed companies, FSY 100, you know, these markets, again, if particularly if you get into high frequency trading, you are having to trade in microseconds.

That's really not the, uh, the domain of blockchain. So I think there are certain asset classes that actually trade. Certainly in pre-trade, Nat Trade are very efficient within their existing infrastructures, financial market infrastructures like central limit order books, for example, for equities and like the FX markets as they exist today.

You know, they're very fast moving. I don't think you'll see them. On chain at a, at an asset discovery in a trade level. Where I think blockchain comes in and is incredibly powerful is post-trade. So if you think about the, they're not just, I mean, all the way from the match to the settle, you can actually collapse the whole life cycle of, of, um, things like if you think about OTC derivatives, which is a highly inefficient post-trade lifecycle, you can actually collapse that onto the ledger and have it as a single.

Unified workflow? Well, there is only one version of the truth and it's on chain. Uh, it may take a few years for that to happen, but that's another big area where we can see vast improvement. Um, but I think certainly in the, if I go back to where we are at Apex, we see a broad range of asset classes that will come on.

Chain funds is absolutely going to lead the charge for sure, because the benefits are so enormous and the disadvantages are so few that that. That, that transformation, and it is a transformation. It's not a revolution, it's an evolution and a transformation has already started and is gaining scale really quickly.

I think other asset classes for me that are really interesting are high value, um, sort of commodities. So if you think about, you know, gold, palladium, um, uh, platinum, all of these sort of, um, very large, um, uh, very valuable commodities where we want to monitor the entire life cycle. All the way from the initial mining through to the distribution, uh, to ensure not only the origination is genuine, but also the quality of the assets and, and the, uh, and the, and the transfer of ownership from the originator to the consumer is, is an appropriate, has an appropriate lifecycle, and we can then eliminate things like, um, dilution of the assets and corruption and slave slave.

Labor and things like that. So I think for certain commodities it's very, very suited, um, to blockchain and tokenization. And I actually think the bond markets still have the capacity to move, um, wholesale. Um, other than the secondary markets, I think certainly the primary markets could move wholesale. On chain over time.

But that requires regulatory change to allow us to hold the registry in a decentralized form. And that's not there yet for securities. But if you look at bonds, bonds, you know, the origination of bonds in the primary market, it are incredibly well suited to smart contracts and the use of the ledger, not just for the initial instantiation of the smart contract, um, but also for driving the.

Obligations of that bond over its lifecycle so that you can automate many of the actions and the events associated with it. But that will take a lot longer because that's, you're in the securities market and it is of course, as you know, very highly regulated and certainly at a registry level through CSDs.

Um, the, the registry of ownership is typically centralized through a securities depository, and I don't think I will see decentralized registries. Uh, wholesale on a global basis for, for a number of years.

Stephen: You, you raised some interesting points, especially about being in the securities markets, which is heavily revolved around disclosure.

And I'm hoping that we can use AI to make disclosures more fun. Yeah. More, more innovative. Like maybe give it to me in a rap or a cartoon, uh, because nobody's reading them anyway and there's such a pivotal, you know, pillar of having a securities.

I'm curious, you just hosted. Apex invest in September, uh, speakers from, you know, Coinbase 21, uh, X Transform Ventures.

You even had Ray Lewis there. I'm a big, uh, football fan. So can you gimme some key themes or takeaways from that event?

Angie: Yeah, I mean, I was absolutely blown away by the diversity actually, of the, of the use cases that we saw through Apex Invest. We've got another one coming up in Abu Dhabi in November. I was, I'm really excited, uh, to see what comes out of, uh, that particular meetup.

Um, we had a very diverse community. What was very evident was, um, many of the people that presented, um, at uh, apex Invest in Lauan recently had been in the game, had been innovating in the blockchain space for many years. And so the thing and the thing that resonated across many of those presentations.

Was the unlocking of cash on chain and what they, what many people said was exactly what we've witnessed ourselves at Apex in, in Apex Digital is by being able to finally be able to get, uh, cash in a tokenized form, in a, in a, in a, in a regulated and licensed form. On chain with all of the rigor and the governance that sits around that, particularly with being able to control the minting and the distribution and the proof reserve.

Uh, and keeping that consumer confidence strong is really, really helps them with the confidence of their investors in wanting to consume funds that are in a tokenized form. So. A, there was a theme that sort of ran through the middle of many of those presentations, and I was particularly blown away by Anthony Basil on the co, on the Coinbase presentation.

Um, because they have been so innovative and they've got such an impressive client base in the clients of Apex. We, we look after them in a number of areas, but, um, and we are clients of theirs as well, actually. But I mean, it cuts both ways. But there was some really innovative work that's been going on and people thinking about how do we, and it's about to, the yield conversation, how do we give.

Our customers a better, a better, uh, uh, yield. How do we improve the quality of the service we deliver to them? How do we diversify the asset class coverage? How do we di diversify, uh, their composability and their use of, of our wallets and things like that? So he, he talked about the vision of the future and I, I have to say, I was in very.

I was very impressed by that. Um, I was on a, I was, I witnessed a panel yesterday at the Digital Asset Week and, and one thing that really resonated was, um, Sandy Call at Franklin Templeton said, if you think about where the market's going, um, really the whole account based model that we've lived with, well, certainly all my life or my adult life, um, financial services have been very account based as an industry is going to become a wallet based industry.

And I, and I actually thought that was an incredibly insightful comment because, um, she's absolutely right. If you look at where, where, you know, the, the, certainly my children and, and Gen Zs and Gen Ys and millennials are going, you know, we surpassed brokerage accounts with wallets. Three years ago in North America, I mean, there are more wallets than, than there, than there have ever been brokerage accounts in living history.

And so it will become a, a wallet based economy, and that's very interesting. And so long as we have rigor around the quality and the security. And the privacy of those wallet providers and that that market is regulated, then I think we're, we are going to see quite a big transformation in the way that people invest and the way they hold their investments and manage them over time.

Stephen: I think that transparency is kind of cool. Like if I know that this is Angie Walker's wallet, I know what kind of NFTs you'd like, what you know, companies that you're investing in from a digital, it opens up a whole new lens, especially in this social media transparency age where people can see what you're doing.

If you choose to allow that, uh, I think it opens up. A whole new ecosystem of just, you know, not just traditional financial institutions where nobody can see behind the scenes what's going on. It really does have that kind of public nature to it. I usually ask my guests, Angie, about what books they read or podcasts they listen to.

After listening to you for 50 minutes, I'm wondering like, where's your book, when's your podcast coming out? 'cause I could listen to you all day. Uh, is there any thoughts about, you know, creating your own, uh, podcast or your own book around some of these key concepts since you have so much vast knowledge of the traditional and the digital asset space?

Angie: No, I don't think so because I, I don't, I don't actually have time to listen to any podcasts, which is a real shame because actually where I get, where I get an enormous amount of my information is actually just witnessing other people speaking about their experience. Right. Um, but I think the one thing I do try really hard to read as much of as I can is, is any of the publications that come from these super regulators, uh, you know, whether that's consultation.

Uh, papers or whether that's, you know, the publication of regulations and technical standards as they are like the RTS type of publications. I try to read as many of the, uh, publications that come from the super regulators as they can. And I also try to just keep on top of where, where organizations that do have a big impact on us as an industry and how we innovate, like the BIS for example.

And, and, and, and. People like UK Finance and the Bank of England have tried to be aware of what's happening at a, at a local level with respect to innovation and sandboxes. Some of these sandboxes are really important if you look at the digital security sandbox and what we can achieve with that. And things like EU pilot regime, you know, these are dropping the life cycle into a single workflow.

So we, you know, the old days we'd have a financial market infrastructure like an MTF or. Or a regulated exchange. And then alongside that, we'd have A-A-C-S-D regulated under CSDR today. If you look in the DSS, or if you look in the EU pilot regime, um, and we've got customers like 21 X who are operating under the pilot regime and regulated by Baffin in Germany, you can now trade and settle in a single workflow for secur.

I mean, you couldn't do that before. You had to, in order to trade and settle securities, you had to have an exchange in A CSD, and they're, they're very big pieces of infrastructure in their own right. So this is, this is transformational. If you look at these organizations that are licensing under what was the UK for My Sandbox, which is now the Digital Security Sandbox and the EU pilot regime, they are effectively facilitating the entire workflow of, you know, trading and settling.

And holding custody on a single ledger. And that's really important because that shows you where the market is going and, and if we get to a point next year where I think we will get to where a digital security sandbox accepts stablecoins for settlement, instead of having to use Central bank digital currency or, or, or, or connecting into RTGS, then what will be very, very interesting will be to see how we can then start facilitating security settlement.

Using licensed stablecoins because that, that really breaks open the door in terms of, of, of the whole industry. So I think there's a lot of things happening, but I do think these sandboxes, these regulatory sandboxes are very important because they act almost as pioneers. They set the, they, they lay, they lay down the.

The ground rules or they sort of set the scene on what is achievable, um, uh, whilst remaining inside the boundaries of, of, of what the regulators are, are expecting us to do and MAs in Singapore, the managed authority of Singapore has been absolutely pioneering with their, with their, with all of the work that they've done through Project Guardian over the last three years.

Again, very much pioneering in the way that they've been and embracing. Um, their, you know, the, their, their members to take to help take them on the journey as well. So, and it's not just securities, they've done it with funds, they've done it with, um, other instrument types as well. So it, you know, I think the super regulators have a big role to play.

Industry bodies like the BIS, uh, the Bank of International Settlements have got a massive role to play. They represent the central banks of the world over, right. Um, and these organizations can help the rest of the industry to become regulated and to become educated and. Understand with confidence how you can use technology to achieve, you know, uh, very valuable outcomes without compromise to, to your obligations or to your client base.

So I think there's a big role that is played by these organizations and we need to support that, and we need to be part of that. And in fact, apex is, you know, very active in its, um, support of any of those types of sandboxes. And, um, yeah, I think it's, it that has to continue to prevail.

Stephen: And you know, those sandboxes are, you know, it's funny, you've probably seen many in the early days and what it's amounted to in regards to fair regulations where the industry is actually able to put input, not just in writing, but be there at the table, having real discussions, providing real life scenarios and examples.

That's a little bit different than sending out a consultation and then receiving all these documents come in and all these revision requests where when you're at the same table, you can probably communicate a lot easier.

Angie, this was an amazing conversation. Where can people find you? I know you don't wanna come up with your own book or podcast, but where can people find you to hear more of your thoughts and, uh, be inspired by this podcast?

Angie: Yeah, well, I'm, I'm, I'm available at Apex. You can reach me at any time, night or day. I can't guarantee that I'll answer 24/7 'cause I'm a human being. Um, and I do sleep for a few hours, but not many every night. But you are very welcome to contact me at any time. I'd be delighted. And we help and we, we are, have a responsibility to make sure that our customers understand what we do and to make sure that, that they understand that we are providing a secure.

Robust, industrialized operate model in the same way we do with the services that we've delivered for 20 years. Right? So, you know, we are continuing to maintain the same standards, irrespective of what it is the asset class that we're actually servicing. So it's important that people, when they do decide to do anything in a, in a tokenized form, um, that they can come to us and feel confident they're not compromising on any of the obligations that they continue to meet as a regulated financial institution.

Stephen: I think anyone listening to this podcast will see what good hands and educated hands they're to begin just seeing your vast amounts of knowledge that you displayed in less than an hour. Angie Walker, thank you so much for joining the podcast.

Angie: Thanks. Thanks, Stephen.

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