Reflecting on the Game

I’ve been thinking about what makes a problem worth spending a decade on. James Carse put it well:

“A finite game is played for the purpose of winning, an infinite game for the purpose of continuing the play.”

In Silicon Valley, the power law drives outsized returns from a small number of winners. But this often incentivizes chasing what’s hot rather than building toward a differentiated view of the future. As Peter Thiel puts it, competition is for losers.

The infinite games worth playing require choosing a problem you would burn the midnight oil to solve and are willing to sacrifice the opportunity costs despite the odds. And most importantly, they require honesty about where you actually have an unfair advantage, your player card.

Why Stablecoins

After joining Coinbase in 2018, I had a front-row seat to scaling blockchain infrastructure, including the launch of USDC. Later, at Sardine, I helped lead the risk platform as it expanded to serve stablecoin use cases.

The lesson from those years was clear: stablecoins work beautifully for consumers. For businesses, they’re broken.

Here’s what I mean. A B2B company wanting to support global stablecoin payments now needs different providers for different stablecoins, payment methods, and jurisdictions, leaving a massive gap in the operational and technical capabilities needed to offer a seamless end-user experience.

The technology works. The infrastructure around it doesn’t exist.

Insight

On a long enough time horizon, the marginal cost of a stablecoin payment converges with the cost of the associated risks: how funds are segregated, how transactions are screened, how operations are automated. As the payments layer commoditizes, compliance becomes the differentiator.

As I put it in a recent PitchBook report:

𝙄𝙛 𝙨𝙩𝙖𝙗𝙡𝙚𝙘𝙤𝙞𝙣𝙨 𝙖𝙧𝙚 𝙞𝙣𝙨𝙩𝙖𝙣𝙩 𝙤𝙧 𝙣𝙚𝙖𝙧 𝙞𝙣𝙨𝙩𝙖𝙣𝙩, 𝙩𝙝𝙚𝙣 𝙮𝙤𝙪𝙧 𝙡𝙞𝙢𝙞𝙩𝙞𝙣𝙜 𝙛𝙖𝙘𝙩𝙤𝙧 𝙣𝙤𝙬 𝙗𝙚𝙘𝙤𝙢𝙚𝙨 𝙘𝙤𝙢𝙥𝙡𝙞𝙖𝙣𝙘𝙚... 𝙒𝙚’𝙫𝙚 𝙗𝙪𝙞𝙡𝙩 𝙩𝙝𝙚 𝙘𝙤𝙢𝙥𝙡𝙞𝙖𝙣𝙘𝙚 𝙞𝙣𝙛𝙧𝙖𝙨𝙩𝙧𝙪𝙘𝙩𝙪𝙧𝙚 𝙞𝙣 𝙩𝙝𝙚 𝙨𝙖𝙢𝙚 𝙨𝙪𝙗𝙨𝙮𝙨𝙩𝙚𝙢 𝙖𝙨 𝙤𝙪𝙧 𝙥𝙖𝙮𝙢𝙚𝙣𝙩𝙨 𝙨𝙤 𝙚𝙫𝙚𝙧𝙮𝙩𝙝𝙞𝙣𝙜 𝙞𝙨 𝙩𝙞𝙜𝙝𝙩𝙡𝙮 𝙘𝙤𝙪𝙥𝙡𝙚𝙙 𝙞𝙣𝙨𝙩𝙚𝙖𝙙 𝙤𝙛 𝙗𝙤𝙡𝙩𝙚𝙙 𝙤𝙣.

Infinite

I started Infinite with Raj Lad and Krisan Nichani, my former colleagues from Sardine. Between us, we’ve built fraud and compliance systems for the largest crypto companies in the world for decades. We know where stablecoin compliance falls short because we’ve spent years in the trenches making these technologies work for merchants big and small.

The cross-border B2B payments market is in the trillions. Most of it still relies on checks, wires, and SWIFT payments, which can take days and occasionally weeks. We believe this will inevitably change, and we’re building the infrastructure to support it.

And so this is our infinite game. Onwards!

If you’d like to learn more about Infinite, check out our post here or book a demo.

This post was originally published and permalinked at nvs.xyz.

A meaningful step towards the future of decentralized identity.

As of today, we’re excited to announce that Distributed Systems is being acquired by Coinbase, the easiest and most trusted place to buy, sell, and use crypto. We firmly believe this move will push us closer to our shared mission: to build an open financial system for the world.

Our team is excited to continue working on applying computer vision to scale identity verification and extending that service to decentralized identities and permissioned tokens. We think decentralized identity is one of the most useful applications of the blockchain and together with Coinbase, we think we can prove that.

Read more about our acquisition via Coinbase, TechCrunch and Wired.

Interested in joining us? Drop us a line at careers@coinbase.com

This post was originally published at distributedsystems.com and is also available as a permalink at nvs.xyz.