How Superstate Is Bringing Wall St Onchain & Why Every Bank Wants To Be Tokenized | Robert Leshner

Good morning. Thanks for having me on.

Oh, I love this question. And I actually haven't heard it before because I was saying backstage before the show that I don't listen to any podcasts. So I'm going in without any context.

Yeah.

Yeah. So, crypto in America to me is about the promise of being able to use new technology in valuable and meaningful ways to just make financial markets better, financial products better, and to make everything under the hood of our capital markets just a little bit more efficient. It means a lot of other things to a lot of other people clearly, but I've always been someone who's looked at technology. I got started on Ethereum in 2017 as just a new tool. And when I got excited about this, I saw that you could finally program financial assets. This is something that was never really available to a developer or an entrepreneur prior to this. Fintech as a concept was all about very slow and careful iterative improvements oftentimes in partnership with other large incumbents that took years to develop. And when I saw crypto, it really just instantaneously became this thing where you could have significant innovation quickly and without too many intermediaries and negotiations along the way. And so to me, crypto in America is just all about the ability to build important and meaningful big changes that you can ideate and create.

Yeah, absolutely. So the first major differentiator comes down to self-custody, right? So when you're owning an investment asset, when you're participating in a traditional product, at the end of the day, it's an intermediary taking responsibility for your assets, controlling them, routing them, moving them around, settling them, etc. The primary difference when it comes to finance on a blockchain is that you as an investor, you as an individual, you as an entity are the one who's more in control of your assets, more control of the custody, more control of the decision-making, more control of the settlement, more control of the operations. And that opens up a lot of new opportunities for you, right? It enables you to say, 'Hey, there's an interesting new use case. There's a new protocol. There's a new system. There's a new thing that I want to do. I'm going to go do that.' without having to wait for a traditional intermediary to build it into their product suite. It just allows you the flexibility to have more control. And what comes along with that are things like transparency and 24/7 flexibility and efficiency and all of these other things, but at the root of it is you as an individual being more sovereign with your own assets.

Yeah, it's funny because I kind of think about this in the opposite way which is as an entrepreneur who's been around a few market cycles of crypto, I believe in raising infrequently but raising a lot of capital because crypto is something that as an industry over the past 13 to 14 years has had a lot of eb and flow. There's been a lot of market cycles and this means things from the price market cycle of Bitcoin and other major assets to the regulatory cycle to the institutional versus retail cycle like there's a constant eb and flow and it feels like at all times we're going through a boom and a bust. And so raising such a significant amount of capital is less to do with like okay our road map over the next 12 months requires $82.5 million because frankly it doesn't, but more from a perspective of there's more uncertainty in the future of this industry than most, right? If I was building a traditional software company or a manufacturing company, I would be raising a lot less capital and I'd be raising probably more frequently as needed. But crypto, there's fundamentally more uncertainty than most industries. Not something that I hope changes over time. I hope through the legislative process and the regulatory process uncertainty goes away. But we're still at a juncture where if you ask me what the market looks like in 12 months and you ask me what the rules are in 12 months and you ask me what the major players are in 12 months, it's a lot harder to answer that than for pretty much any other industry.

Yeah, this is advice I have that's generalized across pretty much any founder, any industry, etc. At the end of the day, the whole goal is to build something important and meaningful that actually causes a dent in the universe, right? And it doesn't matter at the end of the journey if you own 19.6% or like 17.4% or 39%. The only thing that matters is that you dent the universe hard, right? And I think a lot of founders lose track of the bigger purpose of why build something new in the first place? Why launch a company? Why do this? And there's too much thought that goes into optimizing valuation and optimizing capital raised and optimizing which logos are on the cap table. And to me the way I operate is I'm actually penny foolish pound-wise, right? I don't sweat the details of these things and if capital's available and the terms are pretty good I raise as much as I can, right? And if times are hard, rather than spending time thinking about fundraising and doing these flashy things that get you in the press, more time spent focused on how do we optimize our team, how do we hire the best people. How do we let go of the people that aren't optimal? And how do we get closer to building the thing that doesn't exist that people want?

Yeah. Well, I think you're starting to touch on the biggest stories and I see everything from the perspective of tokenization, right? And so, who is interested in tokenization? Well, it's funny because at this point, pretty much every bank on Wall Street is interested in tokenization. Almost every single asset manager interested in tokenization, every single custodian interested in tokenization, every single exchange interested in tokenization. And the one primary settlement platform DTC also interested in tokenization. Outside of traditional markets it's like every crypto exchange interested in tokenization. And so we're at this very interesting juncture where everybody's excited about it almost before we've seen massive zero to one successful use cases. And I'll contrast this as an analogy with stablecoins. Okay, we're at the point now where it's 2026. Everyone everywhere is excited about stablecoins. But that happened after Genius for the most part, right? That happened after the growth of Tether and USDC to hundreds of billions of dollars of assets and it kind of came after it was proven out at scale as something that changed the world past tense. I think tokenization is interesting and different because frankly it hasn't changed the world yet but everyone has this sense of inevitability that it will and an expectation that it will because they see how successful tokenization was for a dollar and that is a stablecoin. And so it's really interesting because behind the scenes I mean I spoke at every bank, asset manager, etc and they're all moving forward with tokenization plans but there's less of a playbook and model for them to build on than I think with stablecoins where everyone knows exactly what it's supposed to be, what it's supposed to look like, how does it work, where does it go. With tokenization of securities and real world assets, I think there's less of a playbook for participants to follow. And so I think we're going to see a lot more false starts. I think we're going to see a lot more products that completely miss the bullseye and we're going to see a lot more experimentation, both successful and unsuccessful.

Yeah. So, I'm not particularly worried for Superstate because there's so many different approaches to tokenization and purposes behind tokenization. This goes to just how many players are involved. But the three primary models, just to lay them out really quickly, that I see: one are what I'll call wrappers or derivatives or things that don't really necessarily fit neatly into US securities laws, but it doesn't matter because they're focused offshore. They're focused on international users. They're focused on just how do we get assets from Wall Street and put them on a blockchain so other people can use them, right? Not that that's going to fit with US institutions because there's a lot of friction there because in a lot of ways it doesn't fit with our existing market structure and regulatory structure, but it's really successful at just getting things on chain for people to use. And then it's like the wrapper model, a third party goes out and just buys some stuff and issues tokens against it. It's kind of like stablecoins pre-Genius Act, right? If you made a stablecoin from 2014 to 2025, there was a lot of different approaches there. A lot of things bit the dust, but some great things were created along the way. So that's the wrapper model and the goal really is just put things in the hands of users. The DTC model is kind of the 180 from there, right? So the DTC as an incumbent today has essentially 100% market share of settlement of securities. It doesn't have 100% market share of settlement of other asset classes, they're particularly focused on equities, but they have a dominating position when it comes to how equities trade, right? They have 100% connectivity with every single broker dealer, the two primary exchange groups for equities in the US, which is NASDAQ and NYSE. And it's fully wired. And so they're approaching it not from a perspective of necessarily how do you put this in the hands of more people, but once stocks are in their system as security entitlements, how can you use them for settlement more efficiently? And this is really the heart of the things that DTC has announced. This is the heart of what NYSE has been alluding to. And it comes down to how do you take a process that today is T+1 has a lot of quiet problems with it, right? Every single day there's busted trades. Every single day there's things that fail to settle. Every single day there's reconciliation issues. How do you take a process that's still fundamentally pretty low tech and outdated and try to step function with tokenization where instead of massive net settlement, you can start to experiment under the hood of the traditional market with things like real-time gross settlement using tokens. And it's a really interesting perspective because they're really viewing it from an efficiency lens, right? They're really looking at it how do you cut back office costs to speed things up. And then in the middle and quite different from either of those is something like Superstate. And so our approach is to take an issuer, a public company, the stock that they issue, make that stock available on chain, not one of the 37 knockoff versions of the stock that some startup went out and made, but a public company's official shares of record being the token on a blockchain. And the advantage of this model differentiated from wrapper tokens where it's totally detached from the issuer or even DTC where it's a security entitlement with a security that's been locked, with the Superstate model it's an issuer's canonical shares and when you own a token you're the direct registered owner of their shares you're in the company's books and records and it's really what I think of as an official stock token. And the advantage of this is, for a company, the whole reason why a company's public, the whole reason why a company issues securities is so that they can participate in capital markets. And when the token is the company's official shares, then suddenly you open up capital market use cases for the issuer themselves. And so, we're not there yet. There's a lot more we're going to be waiting to see this year, but I think this is the year where we start to see companies use tokens, public companies with SEC registrations for capital formation for follow-on capital, for initial public offerings, for all of these different things. When the token is the company's official shares, it can become part of the capital market process. And so that's what we're enabling and why it's so different from a wrapper model or from a settlement tokenization efficiency model and why I think there's going to be a market opportunity regardless of whether or not and I think all the models will succeed but I think it's going to work in its own lane while the other models also are.

Yeah, it's a great question. I mean, there's a couple challenging shifts, right? But when you back up and look at it from the top down, if you're an issuer, you're not that involved in how your shares settle, how they move, right? At the end of the day, if you talk to the CFO of a public company and you say what happens under the hood of US capital markets, they say, I don't really know. It's horrible. We have these service providers that are like the worst experience you've ever dealt with. But it all works, you know, I don't know how it works, but it works. The sausage factory cranks out the sausage and only the people in the factory really know what's going on there. And it's not something where the CFO is pressing buttons all day for the shares to move. They're not, right? If they want to raise capital, they call a bank and they say give us another billion dollars, please. And something happens behind the scenes. That's sort of the stage we're at. And with tokenization, I don't think it's a departure from that significantly, right? At the end of the day, they're basically opting in through hiring a new modern transfer agent like Superstate. As a transfer agent, our job is to record who owns a company's stock, be an official record of it, and enable it to go onto a blockchain. But at the end of the day, they're not going to be pressing too many more buttons even when their stock is on a blockchain. They're basically opting into a new model of allowing a newer technology to do the job of what used to be a legacy technology, which is outdated databases and paper contracts and fax machines and all these really archaic structures.

It's a great question and if you look at where the sort of false starts were in tokenization because there was teams tokenizing things as early as 2017, 2018, right? A lot of the first attempts at this were not with large liquid asset classes they were with small niche esoteric individual assets, right? And I think that was backwards to your point because putting something on a blockchain doesn't change how many people want to own it. It doesn't mean that everyone's going to be desiring to trade it on a secondary market. It doesn't really change the market for the asset significantly, right? If I take this extremely esoteric apartment building in South Carolina, right? There's still like seven people probably understand this one specific building enough to want to buy it, right? It's still a small number of people interested in it, right? Of those seven people, instead of transferring it being like this huge paperwork process and clunky and inefficient, it takes forever, you can make it where fractions of it trade extremely efficiently. But if there's only seven people that want to own something and they're not already wanting to trade it amongst themselves, tokenization won't significantly change anything. There's no real outcome difference there. But if you think about an asset class where there's a huge number of people that want to own it, massive amounts of demand, then suddenly putting it on a blockchain where transferring it becomes instantaneous, settlement becomes instantaneous, it becomes programmable, it operates 24/7, you can use it as collateral, like all of these other use cases, then suddenly I think there's more of an asset market fit. And so when it comes to what assets we're thinking about and where we think tokenization is headed, I think of it in terms of the largest most liquid asset classes first. After stablecoins, which I consider an RWA if you squint, right? After stablecoins, the next logical assets, honestly, are things that look similar to stablecoins, which is why most teams in tokenization have started one way or another with T-bills. Or the lowest risk thing you can have with yield. Because it's really just a single added hop of complexity away from it's a dollar in an account, right? And it's a huge market, around the world, trillions of demand for T-bills at all time. So finding a couple billion of demand that wants to be on a blockchain to move faster, settle faster, be programmable, all these things, it's kind of a no-brainer. So we started with T-bills. I think fixed income markets are extremely logical. But after that, we've moved into public company equity. Why? We know demand is there. US capital markets are the biggest and most important capital markets in the world. There's already demand for every single public company. There's an opportunity to take those shares and just upgrade the way that they move. And we don't have to question whether or not someone wants it. If it was tokenizing an apartment building in South Carolina, I'd have to ask a lot of questions about does anyone want this, right? But I know just based on the market cap of companies, you know exactly how much demand there is. And so I think over time we start as a society working our way towards tokenizing equity markets in general and then after that there's a lot of debate that's going on but we're starting to see great traction in precious metals and assets like that as well.

Oh boy. I don't want to say it's the most because there's a lot of things that are overhyped and I actually don't think there's the most hype around this, but I as a venture investor and as someone in the space, I see pitches all the time for longtail tokenization things where it's like we're going to tokenize a diamond mine in Ecuador or we're going to tokenize this physical commodity and it's like the market for commodities in general is not that big and the people that are involved already know how to transfer it. And so I think just from a to your point Jacqueline earlier about what's the demand I think the commodity tokenization space outside of precious metals is pretty limited and I think overhyped.

Yeah, I would say the most surprising thing is that we haven't had more happen yet. And I think there's a lot of reasons for that, right? But if you look at tokenization today, the number one winning asset T-bills, but it's still small. It's really small compared to stablecoins. And it's a significantly superior product when you think about it. It's like you can have a token that earns zero and you can move around very easily or a token that has the economics of US T-bills that you can move around very easily and we haven't seen the success that I would expect by this point and there's reasons for that. I mean there's deep complexities right now being debated post-Genius about the payment of interest in stablecoins. There's deep questions about within the US market when something is a security because T-bills are definitely securities. They might be amazing ones, right? But they're securities. There's still limitations on how portable it can be. There's still investor requirements. There's still relative to stablecoins a massive gap in the compliance obligations. Stablecoins were really ushered into a framework with at mint redeem there's compliance but in the perimeter there's basically no compliance. And so the biggest surprising thing that I've seen is actually the lack of traction of a vastly superior product in the market and I think it really just comes down to the regulatory treatment of stablecoins and just how liquid and permissionless they can be relative to something that at this point still requires significant compliance obligations.

Yeah. You know, if I had, you know, my legislative wish list, and I don't think this has been debated in the halls of Congress, but, you know, frankly, you know, if I were, you know, Bessent, if I were sitting in Treasury, I would say we want the market for US treasuries to be as big as we possibly can. And I would say Treasury-backed coins should have the exact same, you know, permissive structure as stablecoins. And that, you know, if we want to maximize the amount of holders of US treasuries, we should allow things to basically be exempt from securities laws if the only exposure you have is to US government debt. And this could apply to crypto and to not crypto. You know, I would love to see a world in which, you know, any fintech could offer you T-bill access like almost permissionlessly, right? If it's, you know, a straight pass through to US government debt. You know, I just think there's a lot of innovation that can and should occur there, which has not been touched on yet.

Yeah, it's a great question. I think at the end of the day, you know, most things when it comes to tokenization, the majority of tokenization clearly falls into the security camp, not the commodity camp. You can obviously tokenize commodities. You know, we are, you know, to reiterate, seeing great traction elsewhere with like tokenized gold and silver and the precious metals, but most tokenization really comes down to securities law, right? And I think one of the trends we're seeing is, you know, there's a lot of necessary permissioning at an asset level. I mean obviously there's a lot of projects who don't care and they're like YOLO, like we pretend like it's, you know, working and, you know, it's compliant. It's just not. But let's just speak solely around like the things that, you know, are trying to fit into, you know, the regulatory structure. We're seeing a lot of permissioning at the asset level with this concept that like assets are permissioned and DeFi protocols themselves are not, right? So you can say, hey, to hold this asset, this tokenized T-bill or this tokenized stock, you know, you have to be within a compliance perimeter, but that asset can move into a DeFi protocol outside of it, right? This is the structure that Superstate uses. You know, every single holder of a tokenized T-bill, every single holder of a tokenized share of a public company, you know, we know at all times who owns it, but it can still move into a permissionless DeFi protocol as long as we are able to identify by who still owns it under the hood. And so I think the end result here that we're starting to see is like, you know, compliant assets, open and extensible DeFi protocols. And I think that same analogy will hold with like blockchains themselves, you know, whether it's Canton, whether it's another chain, where there's going to be more permissioning, you know, compliance around like the assets themselves, but the ecosystem will be more open. And I think long term we'll see permissioned assets, you know, coexisting side by side with crypto-native ones or permissionless assets in the same DeFi protocols more and more.