From the Block
From the Block
Digital Assets and Stablecoins After GENIUS
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In the debut episode of “From The Block,” PYMNTS CEO Karen Webster chats with Ryan Rugg, global head of digital assets for Citi Treasury and Trade Solutions, to separate digital-asset reality from market narrative. For banks and corporates, the shift is less about crypto and more about building always-on money movement that works inside the rules.
Welcome to From the Block, where Ryan Rugg, City's Global Head of Digital Assets, and Karen Webster, CEO of Payments, unpack the real questions CEOs and CFOs are asking about stable coins. From infrastructure to innovation, it's the practical path from concept to competitive advantage. In this episode, Karen Webster and Ryan Rugg discuss digital assets and stable coins after genius. What changed, what 2026 will prove.
SPEAKER_01Welcome to From the Block, the show where we look at how innovation on the block, the blockchain ledger, actually changes life on the block, where people can live, spend, borrow, and get paid. I'm Karen Webster. And I'm Ryan Rugg. Hey Ryan, nice to see you.
SPEAKER_02Great to see you, Karen.
SPEAKER_01I hope the new year is off to a good start for you. So far, so good. Off to the races as normal. Off to the races as normal. Holidays seem like a distant memory, right? Really does. Always the way. So we're kicking off 2026, speaking of 2026, with a conversation about digital assets, stable coins, not to rehash the Genius Act, because I think we've all done enough of that. Most of our listeners already know the details anyway, but to talk about what's really changed after it passed and what this year is likely to prove. So just as a refresh, to start us off, a year ago, Genius was framed as a regulatory milestone. So the question for you, Ryan, to start us off is did it just create clarity or did it fundamentally change behavior? What do you say?
SPEAKER_02You know, looking back on 2025, it was the genius was one key legislative piece. But if you think about it, there was an EO signed by Trump. Later the Bitcoin reserve was established. So clearly a foundational shift in the way that this administration is thinking about not just digital assets, but innovation overall. A very pro-innovation, I would say, administration has come in. And, you know, putting genius, as you mentioned, gives that legislative framework that we've been missing for so long. You know, highly regulated institutions do not operate in the gray area. You need those clear set of rules, you know, that can do it. And that this is giving that pathway to our regulators to start laying those foundations for many institutions.
SPEAKER_01I agree with the clarification necessary to make everyone understand what the playing field is. But do we really know what the playing field is? I mean, there's there's the genius act and then there's the rulemaking. We're not quite there yet.
SPEAKER_02No, we're not there yet. We still have a year, you know, genius passed in July. We have a year before, you know, regulation comes into, I would say, fruition. And then you still have time for institutions to implement it from there. But it really gives, I think, the legitimacy to this, right? Where now that you have legislators out there having key bills and more bills with a clarity right now, you know, kind of taking shape, that's going to help give those foundations for clarity in the future. But no, to your point, we still have quite a road to go before we have that like firm kind of regulation and clear, you know, I would say rules in this space.
SPEAKER_01I mean, I I get I get that there's pro-innovation and innovation around um the idea of digital assets, tokenized deposits, certainly stablecoin um clearly um on that list. And and and often everyone talks about that as the first on the list. But but what are the new use cases that are emerging? Is it that new use cases are bubbling up, or there's there's more confidence from those who have all always thought that there was a there to now take those first, second, or tenth steps?
SPEAKER_02So let's think about this technology. Like it's been operating for years in live and in live environments, right? Traditionally, I would say, you know, kind of DeFi space, less and more in the institution. And like, you know, I started back in this space in 2016, and it was primarily, you know, fintechs and retail based, where now you're seeing like the conversation is different because you can see how this technology can fit within existing financial and regulatory frameworks. So I would say, you know, that is like the big shift for me that I've seen the last year, and like, you know, genius being one of them, bringing that clearer view, you know, allowing kind of institutions to evaluate how stable coins, which, you know, I view as like a new set of rails, that, you know, the big question always is like, oh, is this gonna put, you know, potentially other businesses out of, you know, out of business? And no, it's just a new set of rails. And it's very reminiscent to me what happened, you know, in the early 2000s with a lot of these PIs that kind of evolved and, you know, initially, oh, they're gonna put the banks out of business. Well, guess what? They run on a lot of the banks, you know, rails now. So I that's what I view. Like this is bringing that, you know, real-time, always-on multi-asset technology, and now having like the legislative framework and soon the regulatory framework for it to really start to scale within institutions.
SPEAKER_01Why aren't investors more bullish though? When you look at back, when you look at the investors putting money into the crypto stablecoin ecosystem, um, you know, 2020 2025 tally around 16 billion call it um against 200 billion call it for AI. Why the disconnect?
SPEAKER_02So, you know, there's definitely been money put into this industry. You know, back in 2017, you know, when I was at R3, we raised$127 million. You know, we were one of the kind of the earlier ones to go out. So there definitely has been, you know, I would say investment put into this industry overall. But you know what? When you start thinking about foundational financial infrastructure, right? If you think of card networks, you think of ACH wire systems that have become so essential to our economy, but they were not sustained by venture stories, right? I mean, think about it. You know, the showed up in adoption, right? In integration. So I think that, you know, these foundational technologies, if it's a blockchain, if it's, you know, kind of early days of the internet, if you think it's, you know, satellites and like GPS, like they kind of like just become adopted and integrated into, I would say, you know, TradFi or the traditional kind of like systems and like almost become part of the day-to-day where clients don't even know. And like that's one thing I think about, like when you know, been, you know, advising and building in this space for a decade now. You know, the easier to make it to adopt these technologies, the more you integrate them into it, the more intuitive. Like, you know, until Netscape, the internet was kind of, you know, it was very difficult to use. So it's like you have these foundational shifts. And I think we're at that, you know, pivotal point now with this technology. So, yes, venture capital investment is like is is an indicator, but I don't think it's the only indicator for the health of an industry out there.
SPEAKER_01But but use cases are, right? So, I mean, to your point about adoption, scale, profits, all those great things really come from use cases that find this new infrastructure valuable and better than you know the status quo. You know, you can argue that we've been faking real-time instant settlement for a long, long time, right? I mean, you're in the banking business, you know how that works. Um, but what are the use cases where you see adoption and and scale, the green shoots really starting to pop?
SPEAKER_02Yeah, I one of the green shoots is definitely around this 24-7, 365 frictionless movement of money and liquidity. You know, that was where, you know, I started my journey at City, right? Really kind of thinking about that pain point that our clients gave us. It's like, you know, why during holidays? Why do we have banking cutoffs? I want to be able to move money frictionlessly across the globe. And, you know, we have 90 plus branches. So we've really been focused on that pain point. How do you create the frictionless movement, no latency, no legacy, you know, where traditionally our multinationals have to forecast, right? They forecast, they have to send money to multiple branches due to because you know, if it's 5 p.m. in New York on Friday, that means it's 5 a.m. in Singapore. So you'd have to have your the, you know, the money at the branch before it closes. Really removing that cutoff time. And like that's if you think about the same as what you know, we're building with tokenized deposits for really like the institutional frictionless movement of liquidity and payments. You're seeing in like the DeFi, you know, space also, the kind of what stable coins have kind of evolved to be, which is primarily retail-based. Like 88% according to BCP is still retail. It's like that frictionless movement from asset to cash and back to asset without any cutoffs. And so I think that that is one of the real pain points. And, you know, I can say this, you know, I feel like for a long time, blockchain has kind of been that hammer looking for a nail, right? It's kind of trying, it was identity, it was supply chain, it was, you know, all these multiple different use cases. And like that being said, I think this technology has immense power beyond what, but we've kind of found that killer use case. It's that frictionless movement of you know value across the globe instantaneously and the ability to be multi-asset. So it's a foundational shift in the way that people are gonna start to think about this. Cause like, you know, Karen, you and I, we have our cash account and we have our investment account, right? And you know, if we want to go from our cash account to our investment account, it's T plus one, T plus two, depending on you know what you're going into. Same with like large corporates, large internationals. Like, why do you have that latency? Why do you have that, those like breakdowns, those banking cutoffs, those holidays? You know, now you can move from cash to asset the cash, like frictionlessly, you know, tokenized money market funds, which are taking off in the industry as well. You can now move from you know, token to an asset like a tokenized money market fund and back without any T plus one settlement or friction. So I think those are some of the use cases that are starting to shape up that are really rethinking the way that foundation of like financial services is done.
SPEAKER_01Or T plus 10 days if you're closing an account and trying to Yeah, exactly. Deposit the check that you have to wait to get in the mail into uh into another account. That that that that's always fun. Um many people call stable coins mainstream now, would you?
SPEAKER_02So depends like what you mean when you say mainstream. Like I think mainstream when, you know, my grandmother and mother are using them as a utility from a retail perspective. We're large institutions, it is part of their BAU business. You know, I think we're starting to see we're at like a tipping point where we're starting to see more integration, but by no, by no stretch of the imagination is like, you know, individuals as large as well as large corporates have these fully integrated into their traditional systems. Like I think about you know what we built here at City was you know, City Token Service, like we completely offenscate the complexity of the technology where a client either uses API or uses, you know, our UI, City Direct, and it's a drop-down box that says city token service. Other than that, they don't have to host the a node, they don't have to have a wallet, they don't have to manage their keys. We completely offenscate that. That said, on our client side, a lot of these ERP and treasury management systems aren't real time. Yeah, exactly. So take stable coins. So like take you know, tokenized deposits, which we're you know, minting in let's say New York, sending to Singapore and burning. So they're still cash for cash, and they still can't even handle real time because they're like, oh, we have batch settlement. It was after our cutoff. Well, it's like, well, if you log on to the account, the actual money, the fiat, is in your account. So now add tokens, add the complexity of that, add the complexity of having to have a wallet, manage your keys. So I think that we're still really early on. So when you say mainstream, I think that we're starting to see adoption, but by no stretch of the imagination, do I think this is a mainstream um technology yet?
SPEAKER_01But but aren't the things that you just talked about ERPs sort of disassociated with the real-time nature of how the money's moving, isn't that a hurdle or the long pole in the tent, as a consultant might say, for getting adoption at scale?
SPEAKER_02I mean, it they a lot of these large enterprises rely heavy heavily on these systems. So you're gonna have to see change management on both sides of it, you know, to be able to fully integrate into these large multinationals that move billions of dollars a day, you know, that have multiple locations across the globe. So it's gonna have to get integrated into that. And there are, you know, several in my prior role at IBM, there are several of these treasury management ERP systems. And also you've seen acquisitions, you know, in this space by, you know, crypto firms of acquiring treasury management systems. So you're you're seeing a you're seeing the change, but how fast is that gonna happen? And looking back at these foundational like shifts and these foundational, like what we're living through right now is a true generational shift, like which is incredible. Like you think back to the early, you know, 1960s, with you know, kind of the the early days of the intranet, right? With like for defense, how long did that actually take, right? And like that's where we are, right? We're at the beginning of this journey to get fully integrated into these large corporations to have that frictionless movement of you know cash and assets across the globe. But no, I think that it is still a challenge for a larger corporates that they're still on batch management, you know, kind of systems right now.
SPEAKER_01I was talking to the CEO of a payments uh business, global payments business the other day, and he said every change in payments takes about 10 years. I I laughed and I'm like, when you think about it, that's that really is the case. So maybe this is like a 10-year thing that just that just got started because there is the prioritization, the investment, the changes. I mean, it does take a long time. And the CFOs have to prioritize that this is something they want to devote time and money to.
SPEAKER_02But we're also at like an inflection point. It's not just blockchain, right? Like you mentioned AI and venture capital kind of going into that as well. You're seeing a lot of these technologies kind of come into space that are like fundamentally going to shift the way that we're doing business. And you're gonna see the emergence of new entrants in this space as well as you know, the incumbents evolving. You know, we've been in business for 200 plus years. We've continued to evolve, you know, based on our client demands, based on our client need. And like that's the way that I think about this technology. So, yes, it is hard and it could take, you know, multiple years to adopt and change. And that's why it's this is not a revolution, this is an evolution, right? This is a fundamentally shifting the way that we do business and how we think about it. So I think that you have to come with that mindset, but also to make sure that you stay competitive. And like, you know, I think about you know, the strategy that I've advised multiple entities, you know, over the years. It's like, you know, how do you adopt to your client needs? Because if you don't adopt to them, somebody else is and they're gonna go elsewhere. So how do you adopt your service and adapt it and change it and make sure that it's impactful to your clients at the end of the day? And I think yet you have to always kind of come with that mindset as well as like solving a real pain point that you have, not just because it's a technology that you read about all the time. What's the profile of the early adopter? So it's been interesting, you know. I would say that, you know, in my prior roles, you know, it was more of the like the fintechs, the disruptors, like they're disrupting in like their traditional business, to where now, you know, here at City, with what we've been building with City Token service, it's a really wide profile of corporates across the gamut from consumer to healthcare to e-commerce to airlines. It's really, you know, because if you think about it, it's like a foundation technology. It's like, you know, who's using cloud, who's using database, who's on-prem, who's off-prem. It's like, it's one of those foundational technologies that will touch every industry. It's not just one industry that it's going to touch. Um, I'll say the ones that are, you know, probably heavier users of the platform are, you know, kind of the e-commerce platforms, the PIs that you can imagine that have like several, several kind of you know, liquidity and payment movements throughout the day. They've been heavier users, but we've seen a massive amount of adoption across a wide kind of like array of clients, which has been, which has been great, especially in the last year.
SPEAKER_01I yeah, I was curious whether it's the larger, more established, the younger, so to speak, um, but yet multinational companies that recognize that that don't that don't have the same technology legacy debt, um, technical debt that um is required to integrate some of this or aren't afraid of technology integrations. Just curious as to whether that comes into the conversation at all.
SPEAKER_02I think because we often skate the complexity of the blockchain, it's easy for clients to onboard, right? They don't have to open new accounts or they don't have to manage their own keys and so forth, other what I mentioned earlier. So I think that's why we've seen kind of like a broad adoption across multiple different types of you know industries overall. You know, I can say in my prior roles prior to joining City, it was kind of, as you said, some of those more innovative type companies that didn't have as much legacy tech debt. But you've seen like you've seen over time within kind of the payment, you know, space where certain countries that don't have you know kind of that legacy are able to like leapfrog, right? Other countries. So same with corporations that were doing truly digital native solutions built from the ground up that didn't have the traditional kind of treasury management that they had to fully integrate into. So you were I was able to see that, but now, like you know, here at City, it definitely been a very wide um kind of I would say purview of clients that have been on on board in the last year.
SPEAKER_01Going back to genius and some of the things we're gonna see this year in terms of not just regulatory clarity, but also use case maturity. Everyone seems to have a stable coin now. They're like popping up like rabbits in the spring. And you know, I I think back to prior efforts. I thought you would like that one.
SPEAKER_02I'm like, where's she going with this one? It's like, oh, here we go.
SPEAKER_01Well, I mean, this is how my brain works. Anyway, so so I I think about back to the days of Facebook credits. You may not remember Facebook credits, but that was an example of a coin that was intended to provide liquidity across the Facebook ecosystem. It really didn't work because there wasn't enough liquidity. So there weren't enough people on both sides of the supply and demand to really get the momentum necessary to make that version of what we now call a stable coin a reality or something that really worked the way that it was intended, intended. Do you worry that all the flavors of coins that we're seeing will fall to the same fate, or is there something different this time?
SPEAKER_02It's a great question. I think a lot about, you know, kind of post genius. You've gotten kind of the frameworks that, you know, to issue. But do you need, you know, hundreds? Or is it going to kind of be like the dot-com era where you see kind of consolidation across the um industry overall? I do know one thing that you need is interoperability. You know, if you're having all these silo different tokens that don't aren't fully interoperable with one another, and you can't go from you know cash to token, token to asset and back, and the security and the safety and the soundness around them, and you know, they are very different. Like they've taken different approaches. Some of them are extremely regulatory, have their reserves audited, you know, have published their reserves, where other do not are off, you know, offshore, not as compliant. So it's they've taken different approaches, and then you're seeing the emergence of new ones kind of come out. And it's not clear, you know, who's gonna be quote unquote the winner in this space, or if there is gonna be one winner in this space. But I do think that interoperability part of it is is the crux of it. You know, if you don't have it, you have that the siloed banking system that we have today, and like what's kind of the you know, value in that.
SPEAKER_01I look forward to talking about that on one of our podcasts to come. But but wrapping up this one, um, get at your binoculars because I want you to sort of are you like looking at your binoculars? I got them. I got them right here. I got them. All right. So, what should people be watching for this year? That from all the conversations you had in 2025, you're concerned that people might not being paid, might not pay much attention to just yet, but should.
SPEAKER_02Yeah. So I think that one thing that we should watch for this year is for a long time the space has been framed around rapid disruption, right? It's disrupting this, it's disrupting that. For 2026, I really think it's the year that we see like the foundation being set for the next decade and not just the next quarter. You see, you know, multiple of these charters coming into place. You see this legislative framework, you see our regular our regulatory you know entities working on this. This is like the foundation for the next generation, right? So I think that's what 26 is gonna be as we start to kind of see this come fruition.
SPEAKER_01But uh there's still a lot of open questions that need to be sorted. There's what's the one question that you think by the end of 2026 we need to have answered?
SPEAKER_02I think by the end of 2026, what we need to have answered are our tokens going to be treated like cash. And when I say that, when cash comes comes into a financial institution, we do all the KYC, AML, BSA, all the checks and balances on the entity bringing the money in to make sure that it is compliant. Well, now with this technology, I can see five, 10, 15 hops ago where this token was because it's immutable, right? You can see where these tokens were. If they were used in a sanctioned country, if they were used for illicit behavior, but it's being deposited into an institution from like, you know, a KYC client. How what is how is that how's that viewed? How's that viewed by our regulators? Is there gonna be a where after a certain amount of hops, it's I don't know, clean? Is it, you know, it has to be 100% a clean token? And I can tell you when I see a token that is 100% clean or it has no record, and it worries me terribly that it went through some type of washer. So I think answering that question is foundational to how enterprises are gonna start adopting and using tokens.
SPEAKER_01Well, and and banks too, because it all it all becomes back, it all comes back to liability. Who bears the risk? Exactly. A hundred percent. Well, that's a big one. That's an agenda item for the administration and all those who are working to clarify um the Genius Act. Ryan, so much fun. Should we do this again next week? Can't wait, Karen. Great talking. All right, all right, see you soon. Bye.
SPEAKER_00That's it for this episode of the Payments Podcast, the thinking behind the doing. Conversations with the leaders transforming payments, commerce, and the digital economy. Be sure to follow us on Spotify and Apple Podcasts. You can also catch every episode at payments.com forward slash podcasts. Thanks for listening.