In Conversation with Solmate

Hey everybody, my name is Marco Santo.

My name is Victor Fisher.

Um, we are from Soulmate. Um, see if we can get our slide up here.

Yeah, we can see the slides, Marco. They are just behind you.

Oh, fantastic. Today we want to talk about how we can build a new Wall Street right here in the UAE. We're not going to compete with Wall Street. We're not going to try to do better from within. We're going to rebuild it right here in the UAE on blockchains.

And it's actually a really good opportunity to talk about money. Not how to make it and how to invest it and all that, but what it really is. What is actually what does money mean? And the reality is that it changes about every 50 years. You can see uh the goldback trade largely dominated by London for very long time.

But then you'll see it moves and it follows technology. We saw money move from a gold black from a gold back trade to paper money and then from paper money to fiat currency once we could actually keep track of money without using a precious metal like gold. And then what are we seeing now is the advent of tokenization. But we're not just seeing it for money. We're actually seeing it for securities, for commodity derivatives, for treasuries, for IP rights, for chosen and action, for contracts of all kinds.

Um, so much so that Larry Frink has come out and he's got a famous quote now. He says, "I believe the next generation for markets, the next generation for securities will be the tokenization of securities." But this isn't just the future. It's not just the future tense. It's actually the present tense.

What we're seeing is $9 billion of tokenized treasuries on blockchains today. $19 billion of tokenized real world credit happening today on blockchains. And then of course the big number that you've probably heard about and some of you may have actually used is stable coins. Over $300 billion dollars of stable coins circulating uh today on chain. In fact, Paul Atkins, who's the current CEO of the SEC, has gotten so specific on this that he said, "We're actually going to see all markets move onchain within 2 years."

That's a crazy thought. This is the chairman of the Securities and Exchange Commission in the in the US. An incredibly powerful person uh with a lot of insight and control over global financial markets. But why? Well, first of all, I mean, you can do this with money, right?

You can do immediate settlement with stable coins today. Uh bypassing bank accounts, you can earn yield. Yield can be passed through immediately without using bank accounts, without using money transmitters, remittance systems. But I mean you can do this 24/7, right? This is this is not just tokenization.

It's also global operating on the weekends, operating even when markets are closed. And of course, settlement. Settlement is a key part of financial plumbing. This happens automatically on chain. It can happen at the same time as execution of trades.

You don't have to wait t plus two. Um and finally, you can even see the markets themselves occur on chain. You can see uh you can see today decentralized exchanges swapping assets um of all kinds. We actually think that this is going to be happening primarily and it's going to be driven by the UAE and there's lots of good reasons for that. They're clear regulation.

We've already seen adoption. It's not just growing, it's here. We have great talent here in the UAE. The government is aligned. It's a government priority to encourage the growth of digital assets right here in the UAE.

Um the geographic location is really important too. It's something that's often overlooked. My uh my colleague Victor is going to talk about this in just a few minutes, but geographic location is critical when milliseconds matter for trades. And then finally, the UAE actually has the infrastructure for this. Uh at Soulmate, we have a geographic focus here in the UAE.

Um, and we think it's the future. This is what we're going to tell you about.

Thank you, Marco. And so the UAE is our home. We live here. And Solana is also our home. We were seed round investors in 2018.

And Solana is the most used blockchain today. 100 million monthly active users, 3.5 billion transactions monthly. And the chain generates roughly 100 million revenue per month as well. It's actually a bit more 1.

6 billion likely this year. And so we have cho we have chosen and decided to also run Solana from here. Think about Solana as a network of 1,000 validators nodes distributed globally. We have started 17th of October to run the first validator of Solana in the UAE and since then it is producing a transaction every four minutes. So right now as we speak, you know, this speech is 20 minutes, we will be producing actually five blocks around five 5,000 transactions and we only have roughly $100 million of soulmate soul staked on our servers.

Now our vision for the UAE is a three-step process. Number one, we want to create a global staking center here. We want to have 20% of Solana staked in the UAE on servers, which would mean that we would not be producing a block every four minutes. We would be producing a block every 2 seconds. Every fifth block we would be producing here from the UAE.

And that's a superpower. That's a geopolitical superpower because think about it as if we were owning Swift. And if someone sends money somewhere else in the world, we would be actually putting those transactions in the block every two seconds. That's superpower. Once we have that, that will attract as a magnet also other validators and other traders because traders want to be located where transactions are produced in order to reduce the latency.

The closer they are to the validator, the faster they have access to transaction, the more arbitrage opportunities they can handle. And third step of the vision is full tokenization. Not only digital assets, but also you know equities and stocks like XTO platform right now on Solana funds. I would love to tokenize our funds on Solana as well. Beyond that even tokenization of real estate and I I want all of this to run here from the UAE.

The big advantage is the AI infrastructure which is being built. This is a screenshot from a test a competition which was run between November 20 to December 3rd. It AI models were compet competing against each other who would be generating more money trading and the winner was Grock. Grock 4.2 two generated 12% on $40,000.

So roughly $5,000 in two weeks. 12% in two weeks. That's amazing. Which human can can do that? And it's so interesting that Elon Musk retweeted and he said, I guess finally we figured out who will pay for all those GPUs.

And now imagine if we put all the assets, you know, substantial amount of the 500 trillion of assets of the financial system on a blockchain, then AI can help us trade it and that's a massive market. We are excited about that. Now this is a screenshot of a recent article with top 20 financial centers in the world. UAE is not there. We want to put UAE on the map as the key center for digital finance.

Using our three-step process, staking, trading, and tokenization. The benefits we estimate 3 to 5% of GDP increase, but not only having, you know, staking, trading, tokenization services, but think about it, accounting, legal, fine management, compliance, ICT, cyber security and second, it will drive demand also in hospitality, real estate, etc. What we need is super simple. Mainly just two things. Number one, cheaper internet connection.

Internet is the new oxygen. We are right now uh you know paying roughly $12,000 in uh in Europe for 100 gigabit connection. These are the kind of prices we have to get to also in this country to be able to attract the traders who will pay for connectivity. This will increase the market. And second, our combined forces to have 20% of Solana staked here.

And third, you know, regulatory and legal. I'm actually quite impressed with VA and ADGM how they are progressing in in in regulations. And uh lastly, uh talent. We are working with different universities to also, you know, teach the engineers and quantraders of the future to be here. And now I would like to call on stage Lily from uh president of Solana Foundation to have a discussion with us.

Why Solana? Marco.

Thank you Lily.

Should I take you to take them?

Yeah. Have a seat.

Lily, thank you for joining us. Do you want to introduce yourself really briefly?

Uh, sure. My name is Lily Leu. I'm the president of the Salana Foundation. uh going over a decade in cryptocurrency, this industry uh from when it was much smaller uh and much more fringe now is really a centerpiece of the global economy. Uh and uh I've also uh uh recently relocated to the UAE myself.

Welcome.

All right, so Lily, I have to ask you, you've just heard us talk about tokenization. You've probably heard half the people here talk about tokenization for half the time you've been here uh at ADFW. Um, Salana is by far the most used blockchain period, right? But it's also the most used blockchain for tokenization. Why?

Sure. The vision we've had for Salana from the very beginning is first of we thought what are blockchains really supposed to be used for? I think at this point everyone understands what Bitcoin store value, digital gold, why that is important to have in the world. Uh but then there's also this this vision and this dream from Bitcoin really itself that we would have this native financial layer of the internet. Uh and so blockchains blockchains is infrastructure.

Blockchains is financial infrastructure uh is fundamentally it's a tech platform for finance. And what are some of the most important things for financial markets? Well, we always say liquidity uh liquidity. So money is hydrophilic. Uh and we want to be that network for all assets and all applications.

And there's inc there is incredible value uh to markets uh to users to asset issuers of having all of that be colllocated in the same place in the same way that the way we use the internet today we all use the same rails and there's infinite ways and there infinite forms of content and infinite ways to interact with that content. Uh and we think that that is also really the that's really the dream of what blockchain had from the very beginning that we'd have this shared financial infrastructure that everyone could tap into, everyone could use whether you are an individual, whether they're an asset issuer, whether you're an institution because ultimately there's no supererset of uh of liquidity which is larger than that of the five and a half billion people on the internet. Uh and I think increasingly as people start to uh embrace open financial systems uh people also start to see that ultimately why do you want to be on a blockchain? Well, it's about distribution on the internet. Uh and that's something that really resonates to issuers.

Uh now I remember for many years people in crypto were talking about the value of uh of blockchain for financial inclusion of the billion or so unbanked or even more. Uh and that's uh the demand side of financial inclusion. But there's also an aspect of this which is less talked about which is uh the supply side of financial markets issuers uh and really the access to global capital markets that is frankly lacking on the issuer side uh and that is something that's you know we've started to make inroads in that as an industry with RWA uh and tokenization and I think it's really just going to take off from here. Uh so that's a bit about Salana and kind of my conviction about Salana. I'm curious, Marco, uh, you've been in this industry for many years as well.

What brought you to the Salon ecosystem and to Soulmate?

Yeah, I've been doing this for 13 years. I actually looked in the mirror the other day. I realized it's been 13 years since I mined my first Bitcoin using my computer. And I've seen a lot of uh different blockchains come and go, right? Each one was supposed to be like the Bitcoin killer or it was just supposed to partner with Bitcoin.

There's been lots of cutesy memes. Um but Soulmate started uh very recently in fact just over the summer and it started primarily as uh a treasury acquisition vehicle. So the goal was to get as much soul uh the native currency of the Salana network uh as fast as we can. In fact faster than your typical um investor would be able to do it and easier than your typical investor would be able to do it. Um and since then we have indeed grown our treasury um of soul.

But I chose soul because I I think soul is the perfect treasury asset. Yes, it's the network is fast. It's got more developers um joining uh than any other chain in any in every given month for the last year. But I there really three specific reasons why we chose it. One um is that growth trajectory, right?

It's not the biggest uh most valuable chain in terms of market cap yet. And that's good, right? If you're an investor, you're not it doesn't make sense to invest in the chain that's already dominated the world, right? And isn't maybe in slow decline. And I think you all can pick the ones out there.

If you're if you're cryptosavvy, you can pick the ones that I'm talking about. It doesn't make any sense. You want to pick a chain that has a growth trajectory and that has developer interest and the fundamentals are growing. Um but it's also volatile in terms of price right the you don't have to hear this from the foundation you can hear this from the investor and the public company CEO but we actually like the volatility uh in the price of soul the volatil the volatility drives volume which drives investor interest um and it allows us to run more complex capital market strategies and incre and accrete more soul that's that's reason two um but the most important reason is reason three which is that it's natively yield generating um and it generates yield at actually a pretty impressive rate and you can contrast that with Bitcoin for example which is a fantastic treasury asset you'll never hear me speaking ill of Bitcoin um but it's kind of designed not to do anything over the last decade the development of Bitcoin has largely oified right it's kind of stood still it's become well, what it always has been and very little interest in changing and it does not it it you cannot stake Bitcoin at least you can't do it in a risk-free way and you certainly can't earn 6% on Bitcoin like you can with soul. Um so when you combine all those three things you get a treasury asset that we think is really powerful.

It's on a growth trajectory. Um we can actually do things with it. Um, and we like the we like the underlying volatility, but even then we realized that was only half the business from Soulmates's perspective. And so, um, last week we announced, uh, a merger with Rockaway X. Uh, and you have the CEO of Rockaway X here.

Uh, you just heard a lot about what Rockaway X and Soulmate can do together. But now that we have him under the spotlight, I want to ask you, yeah, why' you do it, man? Why did why did you sign the term sheet to merge with Soulmate?

So um look like I founded Rakoy X in 2018 and we are engineering an investment team primarily focused on Solana and for me the biggest synergy was that Soulmate brings treasury and we bring all the underlying infrastructure to power that treasury and beyond. So we already have the engineering teams and data centers in Europe. We just launched the data center also here in the UAE to validate transactions. We have liquidity business. So we are running you know onchain trading.

We are running you know lending. We are running onchain market making which is what I showed is also you know our UAE vision staking trading. And then thirdly, we have asset management which is an investment business which is just like you know even more complimentary once we tokenize more assets. So it was a perfect synergy. So I said we have to do it.

Nice. Well listen Victor CEO of Rockax Liyu president of the Salana Foundation and I'm Marco. I'm the CEO of Soulmate. Thank you for joining us and thank you for hearing us out.

Thank you.

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