# When a Stablecoin Becomes Core Infrastructure I Sam Kazemian (Frax) and Spencer Noon (OurNetwork)

- Speakers: [Sam Kazemian](https://streameth.org/speakers/sam-kazemian)
- Channel: [ETHGlobal](https://streameth.org/ethglobal)
- Date: 2026-07-09
- Duration: 19:32
- Topics: Frax, Sam Kazemian, Spencer Noon, OurNetwork, ETHConf, FraxUSD, stablecoins, Genius Act, core infrastructure, payment stablecoin, digital dollar, risk free rate, yield streaming, Aave V4, Curve, reserve link, RWAs, Treasury bills, money market funds, BlackRock, BNY, WisdomTree, FDIC insured deposits, OCC, network effects, USDC, USDT, PYUSD, Coinbase USDC Earn, composability, programmable money, lending protocols, Morpho, Etherfi, stablecoin treasuries, Travis Moore, Brian Armstrong
- Watch: https://streameth.org/watch/yt-B7-VTfObM0g
- YouTube: https://www.youtube.com/watch?v=B7-VTfObM0g

## Description

In this fireside chat, Spencer Noon from OurNetwork sits down with Sam Kazemian, founder of Frax, to discuss how a stablecoin becomes core infrastructure in the post Genius Act world. Sam winds back to March 2025 when he, co-founder Travis Moore, and US industry figures including the Blockchain Association and Coinbase's Brian Armstrong were negotiating the wording of the Genius Act, which legalized payment stablecoins as federally regulated digital dollars. He breaks down what he sees as the most important part of the act: a stablecoin issuer backed by narrow collateral types (Fed reverse repos, money market fund securities, Treasury bills, and FDIC insured bank deposits, or RWAs representing those) can become a Genius compliant issuer through the OCC or a state regulator, issuing what amounts to legal tender that banks, companies, and fintechs can accept. He explains that while Frax was an Ethereum DeFi OG with an original hybrid algorithmic stablecoin (now deprecated but not shut down, like DAI and Sky), the flagship product is now FraxUSD, a Genius compliant stablecoin that launched right when the act passed in July 2025.

Sam details FraxUSD's core differentiator: unlike USDC or USDT where users and venues have no relationship with the issuer and receive none of the underlying risk free yield, FraxUSD streams the risk free rate directly on chain. He walks through the concrete mechanism built with Aave V4, where a reserve link smart contract checks the average FraxUSD balance in partner protocols like Aave and Curve pools daily, mints new FraxUSD against the growing reserves, and streams it into those venues, making FraxUSD the highest TVL lent digital dollar on Aave V4. Users can view the underlying RWAs (money market fund securities and Treasury bills custodied by BlackRock, BNY, and WisdomTree). Sam frames base money stablecoins as the biggest network effect product in crypto, distinct from yield bearing 4626 vaults, and explains Frax's forward looking strategy of not fighting USDC on established venues but instead becoming the aligned default digital dollar for the infrastructure of tomorrow like Aave V4, Morpho, and new RWA pools. Spencer connects this to DeFi's promise of financial empowerment and Vitalik's critique of unnecessary rent seeking, noting the current disconnect between $300 billion in stablecoins and only $16 billion on lending protocols. Sam closes with a prediction that the stablecoin supply will double from $300 billion to over $600 billion within a year, with banks moving balance sheets into compliant stablecoins and companies running stablecoin treasuries becoming routine daily headlines.

00:00 Introduction
00:07 Winding Back to March 2025 and the Genius Act
00:51 What the Genius Act Legalized
01:17 Deconstructing the Parts That Matter
01:51 The Narrow Collateral Requirements
02:25 Why Frax Built the New Version This Way
02:58 From Algorithmic Stablecoin to FraxUSD
03:48 Being First to Build to the Act
04:31 The User Journey vs a Neo Bank or Coinbase
05:03 Why Most Venues Get No Yield From Issuers
05:32 The Aave V4 Risk Free Rate Mechanism
05:58 Highest TVL Digital Dollar on Aave V4
06:24 Looking Forward, Not Winding Back the Clock
06:58 The Aligned, Regulated, Redeemable Digital Dollar
07:32 Why the Current Lending Rate Falls Short
08:38 Viewing the Underlying RWAs on Frax's Website
09:08 Which Institutions Custody the Reserves
09:37 How the Reserve Link Smart Contract Works
09:59 A Programmable Version of Coinbase USDC Earn
10:33 Why Base Money Is the Biggest Network Effect
11:32 Network Effects vs Yield Bearing Vaults
12:06 FraxUSD as Direct Spend Across Venues
12:34 DeFi as Financial Empowerment
13:10 The $300 Billion vs $16 Billion Gap
13:39 Efficiency, Alignment, and Composability
14:04 Sustainable Infrastructure, Not a Campaign
14:37 Not Fighting USDC on Established Pairs
15:03 Targeting the Infrastructure of Tomorrow
15:37 The Two Year Vision for FraxUSD Dominance
16:32 What KPIs Frax Aligns Around
16:53 Why Eventually There Will Just Be Dollars
17:59 Banks and Companies Moving to Stablecoin Treasuries
18:51 When Billion Dollar Mints Become Daily Headlines
19:07 Closing

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