Dialogue with Agora CEO Nick: The battle for stablecoin licenses has just begun

Nick van Eck (Co-founder and CEO of Agora) explained what changes occur when a stablecoin issuer applies for a federal trust bank license, what it means for AUSD, and why the saying often quoted by founders—"Submitting an application does not guarantee you will receive a license"—is the most important current reality constraint.

News Background: Agora has submitted an application for a national trust bank license to the Office of the Comptroller of the Currency (OCC), joining the largest wave of crypto bank applications since April 1. The reserve assets of AUSD consist of cash, U.S. Treasury bills (T-bills), and reverse repos, managed by VanEck and State Street. Last summer, Agora completed a $50 million Series A financing led by Paradigm, while ending its previous DeFi incentive phase and strategically shifting towards corporate payments, B2B settlements, payroll, and providing white-label issuance services for fintech companies and platforms. This application for a trust license is a continuation of this strategic evolution, rather than a shift in track.

Nick further broke down the actual operational situation during the application process: including a complete business plan, financial forecast model (pro forma), a compliance team of four, and a market leader who was just hired two weeks ago. He explained why Agora wants to become the "bare metal infrastructure" underlying more than 50 "stablecoin neobanks," rather than competing with them at the application layer.

He also discussed how migrating stablecoin issuance to the "on-shore" system through channels like Fireblocks, Coinbase, Kraken, Circle Mint, and Cryptio would unlock capabilities for AUSD. At the same time, he interpreted the GENIUS Act as a clear regulatory signal—"it's time to come home."

Additionally, the content covered Agora's collaboration with Erebor on 24/7 settlement, the reserve management mechanisms with VanEck and State Street, and Agora's positioning in the competitive landscape of "joining the top five stablecoin issuers globally."

Takeaways:

1. Applying for a federal trust bank license is essentially an upgrade from "issuing stablecoins" to "providing financial infrastructure." It is not just about compliance, but integrating issuance, custody, and on/off ramp into the same regulatory framework to gain the core capability to issue and serve customers in the U.S.
2. "Submitting an application does not guarantee receiving a license" is the biggest current reality constraint. License competition is not a technical issue, but a comprehensive game of capital, team, and regulatory communication capabilities, with a long cycle and high uncertainty, typical of a "few-player game."
3. The GENIUS Act is essentially the U.S. "policy invitation" for stablecoins. The core signal is to encourage issuers to move from offshore (like Bermuda) back to the U.S., with onshore issuance becoming the mainstream path in the next phase.
4. The issuer layer of stablecoins is the profit source of the entire value chain. Mastering the issuance rights means controlling revenue distribution, mint/redeem costs, and pricing power, making it the only position with "systemic profit space."
5. Agora's core strategy: to be "bare metal," not a neobank at the application layer. They choose to be the infrastructure behind 50+ stablecoin neobanks rather than participate in front-end customer acquisition competition, avoiding CAC internal competition from the start.
6. The current stablecoin neobank model has structural flaws. Most players rely on the same on/off ramp and stablecoins (USDC/USDT), lacking product control, ultimately leading to price and customer acquisition competition, making it difficult to form a moat.
7. Controlling key nodes, rather than building a full stack, is the optimal infrastructure path. Agora only builds the "issuance + license" as the two long-term moats, while other non-core capabilities like custody and key management are handed over to mature third parties, improving efficiency while retaining core control.
8. They deliberately avoid becoming traditional banks (not accepting deposits or making loans). Their positioning is "stablecoin issuance + digital asset custody," rather than participating in fractional reserve lending, which is a completely different path for financial institutions.
9. The biggest pain point for enterprises accessing stablecoins is "system fragmentation." Currently, they need to connect to multiple systems like Fireblocks, Coinbase/Kraken, auditing tools, etc., which is extremely complex, presenting an opportunity for a "one-stop platform."
10. The upgrade of AUSD is not an asset upgrade, but a platform upgrade. In the future, users will not just use AUSD, but directly utilize the entire system provided by Agora (faster, cheaper, higher yields, and stronger compliance).
11. Onshore issuance is a key turning point. Once the U.S. trust bank license is obtained, they can directly serve U.S. customers, significantly lowering the threshold for institutional adoption and enhancing trust and compliance.
12. Banks and stablecoins will coexist in the long term, forming a "dual-track system." Banks are responsible for the fiat currency track (RTP, Fedwire), while stablecoins handle the on-chain track (24/7, global), with both being complementary rather than substitutive.
13. The 24/7 capital flow capability is the core advantage of stablecoins. Compared to the non-real-time settlement of traditional banking systems, stablecoins have a structural advantage in global capital flow efficiency, which is the fundamental driver of adoption.
14. The complexity of regulation itself constitutes a strong moat. High capital requirements, strong team thresholds, and long approval processes will gradually lead to the centralization of the issuer layer, forming "a few leading players."
15. The biggest policy variable: whether to allow stablecoins to distribute yield. If allowed, it will greatly enhance the attractiveness of stablecoins and strengthen the dollar's position; if restricted, it will directly impact the competitiveness of the entire business model.

Host:
It's great to see you all.

Nick van Eck:
It's great to see you too.

Host:
I was watching yesterday; you were at the New York Stock Exchange, was it today or yesterday? How did it feel to be there?

Nick van Eck:
It was awesome. The New York Stock Exchange is really beautiful. Most of the interviews I did there were from 8:30 to 10:00 AM, which was particularly busy. Yesterday's interview was during a quieter time; it was the quietest I've ever seen the exchange, but overall it was a fantastic and beautiful venue, so the experience was great.

Host:
Was there anything you didn't get to mention yesterday but would like to add in this program?

Nick van Eck:
I think we talked a lot about how banks are trying to slow down the progress of the GENIUS Act. I wish we could have discussed more about the opportunities for banks in stablecoins and what we are doing because we are ready to seize this opportunity. Yesterday was more about why banks want to slow things down, which is quite intuitive—any new technology that might threaten their business, they will want to slow down. But in reality, there is a lot to discuss about the opportunities, and banks and participants like us should be more proactive in engaging.

Host:
Let's start with the news you released last week. You submitted some applications; what exactly are you applying for? Where does it fit into Agora's overall strategy and the current regulatory environment?

Nick van Eck:
The background is that the GENIUS Act was passed last year, granting the OCC federal regulatory authority over U.S. stablecoin issuance. We have been working hard to build products to support our future vision. In the first quarter of this year, we did a lot of preparatory work with the goal of applying for a national trust bank license. Last Friday, we announced that we have submitted an application for Agora National Trust Bank.

If we obtain this license, it will bring us unified federal regulation (provided it is approved) and also expand our product capabilities. We have been in the stablecoin issuance business for nearly two years. The role of the issuer itself brings a lot of profit space and can play a role in other parts of the value chain. Our mission has always been to bring enterprises onto the blockchain.

When enterprises consider whether to enter stablecoins, they typically think about three things:
First, how to access and operate these assets—meaning wallets or custody;
Second, how to transition between the existing financial system and the on-chain world;
Third, compliance, tax, auditing issues—currently, stablecoins are not considered "cash" in many cases, which poses a problem for enterprise auditing before the GENIUS takes effect.

What we are currently solving is the "what assets to use" issue; we believe it should be AUSD because we will distribute yields while supporting free fiat minting and redemption. In the future, we will provide a complete set of out-of-the-box capabilities to allow enterprises to transfer faster, earn more yields, and establish global businesses.

Host:
Was this vision there from the beginning, or has it gradually formed recently?

Nick van Eck:
We have had the vision of "controlling the entire tech stack" from the start; the product direction has always been clear, just with changes in pace. For example, white-label stablecoins were already on the roadmap, but we accelerated the push last year due to market enthusiasm. However, from a business perspective, it is just a function, not the platform itself.

The core issuance capability is the platform. We have always been thinking about what else can be built on top of this platform.

To be honest, in the early days of starting up, I never thought I would apply to become the CEO of a federal bank. The environment was completely different then. The pace of the GENIUS Act's progress has been much faster than I expected, which is great because it has released demand ahead of time. So last summer, we decided to prepare for it and began internal construction.

Clarification of regulation is very important for us. In the past, everyone had to piece together licenses from 50 states (MTL), plus regulations like NYDFS, which was very complex. The GENIUS Act will greatly accelerate the adoption of stablecoins. The market size is already $300 billion, but the U.S. still lacks a complete regulatory framework, which is quite astonishing.

The next year will mainly be a preparatory period, with the real explosion likely occurring in 2027 or 2028.

Host:
You mentioned "becoming bare metal"; where does this concept come from?

Nick van Eck:
In the past month or two, stablecoin "neobanks" have exploded, whether To C or To B, they are basically using similar tech stacks: wallets, on/off ramps, cards, etc., and are desperately competing on customer acquisition costs.

Our view is that you must become the underlying infrastructure to master the profit space. Right now, these neobanks are using services like Bridge, which charge 3-5 basis points for on/off ramps, and they have no control over the core product.

So we decided to start with the stablecoin itself. As the issuer, we are both asset providers and natural on/off ramps. The strategy for AUSD is to be free, so there won't be absurd situations like "charging fees to transfer from Venmo to Bank of America."

We want to reduce the middle layer and reach customers directly. We do "metal layer" at key strategic points, while other non-core capabilities can be handled by third parties, such as custody and key management, which are already mature fields, but the license must be obtained ourselves to control the experience.

Host:
What are the differences between different licenses (like national trust vs BitLicense)? Why did you choose this path?

Nick van Eck:
Most people understand banks as deposits + lending (fractional reserve), but we are not this model. We are more like issuers providing global liquidity and fiat channels.

We do not accept deposits or make loans. For example, Mercury recently obtained a deposit bank license, and they will handle their own deposits and loans in the future. We only want to do two things: issue stablecoins + custody digital assets.

Other functions, like dollar accounts, can be provided through partner banks. Issuers themselves need global banking infrastructure, which no one can build from scratch.

Host:
If everything goes smoothly, what changes will AUSD undergo?

Nick van Eck:
The biggest change is that we can directly serve U.S. customers. Currently, we are using a Bermuda license. The GENIUS Act is actually encouraging us to "come back to the U.S."

From day one, we can provide U.S. users with direct minting/redemption.

More importantly, at the product level:
In the future, enterprises will not just use AUSD, but will directly use the entire system provided by Agora—faster, cheaper, higher yields, and safer under the trust bank system.

Now, if a U.S. enterprise wants to use stablecoins, they need:
Fireblocks + Coinbase/Kraken/Circle Mint + Cryptio + other tools, making the process extremely complex.

What we want to do is integrate all of these into one system, which will be a killer app.

Host:
How did your collaboration with Erebor come about?

Nick van Eck:
We met them about a year ago. Issuers have a large amount of deposits, which is very attractive to banks. At the same time, both sides are pushing the frontier of capital flow—they handle traditional payment tracks (RTP, Fedwire), while we handle on-chain tracks (Ethereum, Solana, etc.).

Stablecoins need to operate 24/7, while banking systems do not. Erebor is pushing this point, so both sides are very complementary.

Host:
Is it difficult to apply for a federal license?

Nick van Eck:
Very difficult. Compared to the 50 state MTLs, this is a unified framework, but the thresholds are extremely high:

• Management and board must have experience

• Requires a large amount of capital

• Must have a complete business plan and financial forecast

• Must maintain ongoing communication with regulators

We have a four-person compliance team and a complete financial team, and we have spent almost no money on growth until we hired our first marketing person two weeks ago.

This is completely different from the operational model of software companies.

And one thing must be clear: submitting an application ≠ guaranteed approval. We are still pushing forward.

Host:
From a regulatory perspective, what kind of era are we in now?

Nick van Eck:
This is one of the most important periods in U.S. banking regulation history, which will change financial markets, capital markets, and payment systems, not just in the U.S., but globally.

Host:
What do you think is the biggest risk point?

Nick van Eck:
In the past few months, there has been a lot of discussion about "yield distribution." We believe issuers should be as free as possible to distribute yields, which will be attractive to global users and enhance the appeal of the dollar. I hope this point can be handled well.

Host:
Do you have any final thoughts?

Guest:
We are still in the early stages, but the direction is right, and growth will be rapid moving forward.

Nick van Eck:
We will have more collaborations and discussions.

Host:
Thank you for participating.

Nick van Eck:
Thank you for the invitation.

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