All right, here's the highlight of the breakfast. [laughter] Very honored to be able to moderate this session with Maggie and Yuval. Why don't we please start with a brief intro on your side. I know that neither a16z or Canton need an introduction, but it'd be nice to hear directly from you for two, three sentences on what you guys do and what your company does.
Hey everyone, my name is Maggie Hsu. I'm head of go-to-market for a16z crypto. We have about 10 billion of AUM focused on crypto investments globally, kind of at all stages and all parts of the stack. So it's great to be here today.
Hey everyone, I'm Yuval, the co-founder and CEO of Digital Asset, the creators of Canton Network.
Amazing. My first question to both of you is really about why Korea and why Asia, particularly for a16z. I think it made a big headline that it's been a year already, I think, Maggie, that you decided to expand into the Korean market. So really curious why the team has started to think that Korea is a crucial market. And also for Yuval, I think I see you in a news article and a picture shaking hands with the high-level executives and banks and institutions more often than any other Korean. So, props to you. But again, curious how that all started. If you look back in that past two years, what specific development progress have you guys seen particularly in Korea that made you think and want to invest more in this market?
Yeah, I mean, we had been tracking the retail interest for some time, but what I think was quite exciting was to see the institutions leaning in. And one proxy of that is really M&A activity. And as you all know, in Korea, Naver buying Dunamu, and in Japan, SBI buying Bitbank. I think those were just two positive signals that we've seen, and for those sorts of institutions to have crypto underlying them, and so for that to potentially be this new financial rails was very exciting, one of the reasons we opened the office.
So for us, maybe I'll start with the Asia side of things. You know, we've been at this mission for 12 years, and our view from day one was that traditional finance moving on-chain is really the holy grail of this technology, and we've been very focused on that. And you know, if you just kind of break it down very simply, you know, US market is the largest, right? What we're doing with DTCC, which we'll talk more on equities and treasuries, is step one. But then when you go to Japan, you know, Japanese sovereign bonds is the second largest, most important T-bill in the world. So we're doing a lot in Japan. But if you think about the last few years, especially what is happening with geopolitics, you know, I think that Japan and specifically Korea are going to become even more important markets. a16z actually just opened their office in Japan as well. So, you know, our view when we think about what we want to do with Canton is really go to where are the most important markets. So I think Korean manufacturing, Korean AI-related companies, and just generally speaking, the export activity from Korea to the rest of the world makes it a very important market to connect into the global economy.
Interesting. I think that's a great segue to my next question, which is part of why this organization, Asia Stablecoin Alliance, exists, is to help people understand the diverse Asia, which again consists of a dozen of different markets and countries. Could you guys both speak a little more to which market specifically you're very excited about? It could be whether it's the speed or the sheer impact, whether it's Korea, Hong Kong, Southeast Asia, or Japan. Which market are you particularly excited about and why? Even if you don't say Korea, we won't be offended. So please just be honest.
Yeah, I feel like it's a trick question here. I mean, I'm sitting in a room in Korea, so I kind of have to say that. But there is a reason that we chose Korea for our first APAC office. I think I've been surprised at the speed at which the institutions have been moving. So think about names like NH and Hana. If it's, you know, coming from the top and they're able to really, you know, there's just a speed that I wouldn't expect necessarily. And when these things are founder-driven or co-driven, then they really can get pushed forward.
Yeah. I mean, for us, you know, and I mentioned Japan and Korea specifically with respect to Asia. I mean, of course, again, the US is the largest market in the world, and, you know, most of our business and activity on Canton is coming from the US. That being said, you know, we've been, as I said, very focused on institutional activity because it's the largest and it's also the only activity we've seen in crypto. A lot of these waves of, you know, themes, NFTs, memes, and those are very retail-driven and therefore have very cyclical kind of like pattern, where institutional activity is very, you know, stable, right? Has some fluctuation, but overall have kind of like durability over time. And therefore, you know, like I said, our focus is always on large critical markets. I would say that one of the things that I'm very excited about with respect to Korea specifically is, you know, there's a lot of markets where you're hearing, you know, regulators or administrations moving forward and tackling, but the underlying kind of customers are not necessarily very crypto or blockchain native, where in Korea, you know, you have super advanced consumer base with respect to the technology. That I expect that once regulation picks up and the institutional players step in, right, you're going to have a very quick adoption by the consumer because they are used to the technology, right? This is not a market that requires customer education like many other markets would require.
Just off of what you said, I would still like to make a distinction that people who are very well-versed in terms of speculation, trading, meme coins, and NFTs wouldn't necessarily translate into using any of the institutional finance on-chain that we're talking about. So, with that said, would Canton, fundamentally by thesis, doesn't have to be opposed, but would you ever onboard a memecoin project on Canton?
So, I'll push back on your point. If you look at the largest shareholders of Tesla outside of the US, it's Korean investors. So it doesn't have to be only memecoins and NFTs. I'm making the separation of familiarity with the technology. And then if you look at the Korean market as a market, it's a well-versed market in also trading of traditional financial products, not just meme coins and NFTs. So that's just one point. Listen, I think with respect to your specific question on memecoin trading, you know, Paul Barron tackled me on that question and was saying like, you know, his biggest question on Canton was what is the memecoin on Canton? And I said I had no clue and I was ridiculed for that. And, you know, since then there is a memecoin platform. You could trade meme coins on Canton. The reason I don't bring that up is because again I am a believer that things that have underlying utility that translate into cash flows will survive over a longer period of time. And I think that what we are trying to build in Canton is again a chain that will get to, you know, we're close to a billion dollars of fees a year. The goal is to get to, you know, five billion dollars of fees. And it's not that if tomorrow there's like a move down in the economy, then all retail get out and suddenly your chain is doing like, you know, $30 million of fees a year, which is what we've seen in many other cases, right? So, it's not that I'm anti-memecoin trading. There's memecoins on Canton. But again, if you ask me from a digital asset perspective where I put my emphasis and my focus, it is on repo market that does $15 trillion of notional every single day. Doesn't matter what the market is doing, right? So that's kind of the distinction of where my focus is.
Okay. So no meme coins on Canton, everyone. I'll turn to Maggie for a set of questions that I have. You've been leading the go-to-market efforts at a16z crypto, and when I first learned about your job, frankly, I had to wrap my head around what that actually means. And I'm curious, particularly, what that means in this region, right? So, is there any particular portfolio company user base or market progress, again, that makes you want to focus more on Korea and also specifically in the Asian market? Was there any specific progress or development that you saw among the portfolio companies that made you realize, okay, it's time to double down in Korea or Asia overall?
