We’ve seen a big push in recent years to improve cross-border payments. And yet, cross-border payments remain problematic for consumers and businesses, particularly in emerging markets or parts of the world with volatile currencies or limited availability of correspondent banks. At the center of this challenge is a concept called liquidity.

In this episode, Yvette Bohanan and Ashley Lannquist welcome Mouloukou Sanoh, CEO and Co-Founder of MANSA, to explore liquidity challenges in cross-border payments, the transformative potential of stablecoins in emerging markets, and the strategic role of fintechs and banks in evolving global payment infrastructures. Listen in as they discuss practical solutions to these complex issues, aiming to unlock liquidity and scale payments efficiently across borders.

 

 

 

Yvette Bohanan: Hello, I’m Yvette Bohanan, a partner at Glenbrook and your host for this episode of Payments on Fire.

We’ve seen a big push in recent years to improve cross-border payments. Swift GPI has made improvements in speed and transparency for wire transfers. Project Nexus launched by the Bank for International Settlements is working to enable cross-border payments using instant payment networks.

Providers like Ripple have been creating solutions that use distributed ledger technology to help businesses. Pilots have also tested models for using Central Bank Digital Currencies to facilitate cross-border payments, and yet, cross-border payments remain problematic for consumers and businesses, particularly in emerging markets or parts of the world with volatile currencies or limited availability of correspondent banks.

If you’ve ever sent money abroad to a remote location, you probably know that fees can be high, and often the recipient has to deal with delays or extra costs. Now, imagine trying to run a business across borders where every hour and every percentage point of cost makes a huge difference.

At the center of this challenge is a concept called liquidity. Simply stated, liquidity is how easily you can access money when and where you need it. In global payments, liquidity is what enables dollars in New York to become pesos in Mexico or naira in Nigeria instantly. Without liquidity payments get stuck in queues, waiting to be posted to ledgers or require expensive workarounds to complete.

Today, most cross-border payments work through pre-funding, either directly or through a correspondent bank. Here’s how it works in practice. Suppose a company wants to send money to Tanzania, the company or its bank has to have cash in a Tanzanian bank account, denominated in Tanzanian shillings ahead of time.

That prefunded account acts like a pool. When the recipient in Tanzania gets paid, the funds come out of that pool. If there isn’t enough money in that pre-funded account, the payment fails. Keeping large balances locked up in multiple countries is costly. It ties up working capital and limits how much volume can be processed.

Think of it like running a chain of restaurants in 20 different cities. If I had to stockpile water in giant tanks in every town, just in case customers wanted a glass, I’d be wasting resources. Some tanks would run dry, while others sit full and unused. That’s pre-funding in the payments world. Lots of money tied up in tanks all over the place, but not necessarily where you need it when the customer shows up. True liquidity would mean having a reliable plumbing system so that water, or in our case, money could flow instantly to wherever it’s needed.

This is why liquidity is such a headache. Each stakeholder, banks, fintechs, stablecoin issuers, on and off ramp providers, feel it differently. For the sender, it means higher costs. For the local bank, it means they might not have enough cash to cover payouts. And for fintechs trying to grow, it means they can’t scale without large amounts of money sitting idle in dozens of accounts.

Instead of pre-funding everywhere, what if you could move digital dollars or tokens instantly across borders, but, and this is crucial, the last mile still matters. You still need to make sure there’s enough local currency liquidity so that the digital dollar can be become shillings, pesos, naira, or baht when the recipient needs it. Solving this on-ramp, off-ramp liquidity puzzle will determine whether stable coins can truly change payments in emerging markets, or remain just a parallel system.

Joining me for this podcast is one of my Glenbrook colleagues, Ashley Lannquist. Ashley, welcome to Payments on Fire.

Ashley Lannquist: Thank you. I’m excited to be here for the first time.

Yvette Bohanan: It won’t be your last. I know this topic, this space and all the stuff you’re working on is too hot right now. You’re going to be pulled in quite a bit to co-host or host, I think, going forward. So super excited that you’re joining me today to jump into the Payments on Fire hosting family here.

And joining us today is our guest,  Mouloukou Sanoh, co-founder and CEO of MANSA, who has been tackling this problem head on. MANSA is building a global settlement platform that reduces the need for pre-funding to make cross-border transactions faster, cheaper, and more reliable, especially in Africa, Southeast Asia, and LATAM, where the need is really the greatest.

They’ve already moved over $122 million in payments and recently raised a $10 million round, led by Tether, to scale the vision. They’re doing some exciting work in the Hop 71 program, and we are just super, super excited to have you joining us. Mouloukou, welcome to Payments on Fire.

Mouloukou Sanoh: Thank you so much for that introduction and kind words, Yvette, and a pleasure to meet you, Ashley. I’m super excited to be here on the podcast.

Yvette Bohanan: Yeah, we are fascinated by what you’re doing. So we’re just going to jump in and I wanted to start, we always start with a little bit of background on our guests and how they got here. But when we were preparing for this episode, we were chatting a little bit and you said that your aha moment, like one of the big aha moments, came when a major African B2B company had to turn down, and this was staggering to me, had to turn down a $100 million trade because of lack of capital and the inability to move funds.

And I wanted to start there and maybe you can tell us about that moment and then how your investment background in banking, dealing with fintechs, allowed you to spot where those bottlenecks were.

Mouloukou Sanoh: Yes, definitely. And, that’s a great question. It was definitely one of those eureka moments, like when I discovered truly, the essentially like scale of it, right? So, just for context to the listeners, is that international payments works because of pre-funding. If you give me a dollar here and I want to give you a dollar somewhere else, I must have the dollar on the other side of the world. If I don’t have it, like I simply cannot do the like transaction for you.

So there is currently $4 trillion that’s locked in all these prefunded accounts, from your largest financial institutions like JP Morgan to your large fintech and like remittance companies like Western Union. All of them keep prefunded accounts with their correspondent bank. So then whenever you do an international transaction, they could instantly debit it up to you.

Like a lot of people still don’t realize that Swift is actually a messaging layer. So it doesn’t transmit value. It only sends messages between all these different correspondent banks. And this is why sometimes it takes T plus three, or in cases like the African continent, T plus five, or Latin America, T plus seven for example.

So fintechs get around this using their own balance sheet. But if you are limited, you simply cannot do trade. So I was sitting down with the founder of arguably one of the most recognizable and most famous African crypto companies and literally fintech companies, and he mentioned that he couldn’t trade and he had to turn down a hundred million dollars worth of deals, of transaction, and these are for large companies like Coca-Cola or your Facebook or your Amazon that are constantly doing payments in Africa, because he just didn’t have enough like US dollars.

So we have been solving this issue right now for the past three years almost. We went live last year. We have done $150 million so far for some of the largest fintechs in Africa, Latin America, and Southeast Asia. Most of the fintechs we’ve started working with have increased their revenue by 30%, and their background and their volume by essentially 40% because they’re now able to do much more transactions, much larger transaction, at much a larger clip as well.

So, it’s really great to see some of these fintechs scale and the new markets that they’ve been able to enter because of the infrastructure that MANSA has been able to provide to them. And this is the global problem that exists across all emerging markets.

Yvette Bohanan: Yeah, and I just want to back up. This is very helpful context. $4 trillion, is that what you said? So you’re calling this pre-funding, which is sort of a term that I’m guessing is the one that you grew up with from your investment banking background in that when you’re looking at the capital markets to kind of connect that to what a payments professional might be thinking here.

And you talked a little bit about Swift being a messaging network, and I think that is something that people don’t realize. Money isn’t quote unquote moving through Swift. It is just a messaging format. It’s a great messaging format, but it’s a messaging format. But it all relies on this notion of correspondent banking and those correspondent banking accounts have to have money in them. And that’s this $4 trillion that we’re talking about here.

So when you have to have money like that in the accounts, the first problem, as you’re saying, is you have to get the money. It’s not easy. We’re going to come back to how you got the money in a minute because I’m very curious about that. But what, besides having the capital tied up, are there other risks or limiting factors here that play out when you’re trying to do business to business payments?

Because you’re really focused on not remittances, but the B2B market. And that’s global supply chain. This is huge. This is the largest by value kind of cross-border or anything segment of the payments industry is B2B. So what constraints does this sort of historic model of pre-funding have and risks?

Mouloukou Sanoh: Yeah, I believe that the biggest risk that the current model of pre-funding have is that number one, you as a business, you overextend yourself because you tie up all your capital in all these different places around the world. So your opportunity cost, number one, is incredibly high. Number two, because it’s in fiat, it’s quite expensive. You have all the different bank charges, like the bank is charging you like annual fees for holding the funds.

And number three, because a lot of these transactions are actually going to emerging markets, you are number one, restricted by capital controls because you’re not able to freely move around your dollars even though they are your own dollars. Or number two, your capital is in local currency, which is devaluing 400%. So correspondent banking doesn’t really work for a lot of the companies in emerging markets where they’re sending money to Africa, or they’re moving their dollars from Africa, from LATAM or from like Southeast Asia in general.

And this is why stablecoins are such an evolution. So we provide all the pre-funding in stablecoins. We don’t need to keep it like at a bank, we just keep it in our wallet. A transaction cost, sometimes as low as a hundredth of a penny, and we are able to go from USDT or USDC into Nigerian naira, into Filipino pesos, into Argentina pesos. So much more seamless and so much more smooth.

And we’re not constantly affected by all these local headwinds such as inflation or the changing of the currency, like so on and so forth. So it makes treasury management so much easier and so much more seamless. And this is why stablecoins have really found product market fit not only in payments, but in how fintechs manage their currencies and all the different currencies they keep on their book.

Ashley Lannquist: Thank you. That’s so helpful and interesting. I wanted to jump in with a couple questions. for the point on there’s a little bit more stability in the currency holdings, is that because the balances are held in Tether, basically? Okay. Great.

Maybe you could, we could take a step back and you could remind, I think you started to explain some of this. Your solution, MANSA, it sounds like primarily it’s through sending Tether. Maybe you could let us know, like over what blockchains, how do your customers, what wallets do they hold, how do they get access to this service?

Mouloukou Sanoh: Yeah, that’s a great question. So we primarily use Tron, the reason being, because it’s the most widely accepted blockchain as of today, right, in many like emerging markets. A stablecoin is only as good as its ability to be able to move in and out of local currency and the corresponding infrastructure that exists with it, right?

So like people always think that stablecoins are just this magic bullet and I’m going to make a stablecoin. Everybody around the world is going to like adopt it. No. What’s really great about, about Tether and then what they’ve built is they’ve built a financial ecosystem that has over 400 million users all over the world in some of the most financial un literate, in like markets where there’s no financial infrastructure, like people have relied on USDT as their source of dollar. And in addition to that, they have also created a corresponding ecosystem behind it.

So in many of these markets, you will find people whose job it is, who will take your Tether and give you local currency, who literally just arbitrage between the digital version of the dollar and their local currency. And what’s also like very interesting, right, if you go to a lot of these like computer markets in places like Nigeria or Argentina, or even I believe in the airport in Bolivia, you will see that a lot of the merchants have started accepting USDT. And as a result of that, a lot of the fintechs have as well have started accepting USDT because if you look at the context, right? It costs 10% to send money to Africa, 5% to Southeast Asia, around 7% to like Latin America. With USDT costs a fraction of a second. You know that you will always be able to redeem it and it has also the most depth.

And I think one of the most important things as a payment company when you are using stablecoin is, number one, you need to ensure that you’re able to seamlessly move from your local currency to the stablecoin. Number two, you must ensure that the markets are deep enough. Because if you’re moving tens of millions of dollars every day, you must make sure that there’s actually a corresponding market that will give you the amount you need, whether it’s in stablecoins or whether it’s in local currency.

And number three, like you must make sure that there is that infrastructure, there is that necessary wallet infrastructure that can take your coins. Currently right now, we’re working with some of the major wallet providers like Fireblocks and like Utila to be able to essentially seamlessly transact with multiples and many of our fintechs.

But I think the most interesting thing is actually having interoperability with your bank. So being able to go with banking bureaus from your local currency to your USDT, from USDT to Hong Kong dollars, for example, to the payouts in China. And I think the most powerful infrastructure is one which enable you to seamlessly move between these two worlds and seamlessly settle transactions.

Because at the end of the day, I don’t believe that, yes, payments are going on chain, but the actual settlement of that payment still needs to happen in fiat. People still need fiat currency on one end or the other to be able to settle those payments. And the banks have the best rails, and people will still always use their banks as well. So I think that interoperability is incredibly important.

Yvette Bohanan: Okay, so you’ve just said like a whole bunch and it’s fascinating what you’re doing. And you’re doing something that is addressing, what you just said at the end there, at the end of the day it has to get back to fiat and it’s this on-ramp, off-ramp kind of situation that you were describing and how a lot of entrepreneurial people out there and some of the incumbents are trying to solve for that, right, locally you go in the airport or whatever. But when you come to a business to business situation, this is a huge untapped space that is kind of holding back a lot, right, in the world globally and we’re going to get to that idea in a moment, I think.

But let’s unpack this a little bit more slowly for our audience and our listeners so they really understand what you’re doing. I’m a business. I am trying to get to a supplier in Hong Kong. I’m sitting in, I forgot what country you said, where am I?

Mouloukou Sanoh: Nigeria.

Yvette Bohanan: Nigeria. Okay. I am in Nigeria and I want to use your service. What do I need, first of all, to do that? I need a wallet and I need to know about you. But then what do I need to do as a business to set up to get into this?

Mouloukou Sanoh: And I think the beautiful thing about, and this was actually like one of the things that we talked very deeply about when we were thinking about how do you scale this. Is the easiest way to scale this by going direct to business or by already serving the fintechs that serve hundreds of thousands of businesses and do billions of dollars in annual flow already?

So we don’t work directly with the business, but we work directly with the fintechs. So the payment service providers, the B2B cross-border payment companies, the B2C payment companies, the on and off ramps, because like we believe that that is the quickest way to scale and the quickest way to have long lasting impact. So the way that we work with them is that a payment company signs up with us. We give them our APIs and through our APIs, whenever they have a transaction that needs to get like pre-funded, they can just call the API.

So for now, we have been working with stablecoin-first fintechs, so they already have a wallet. They already know how to do the on and off-ramp themselves. But as we scale and as you have many more fintechs using stablecoins, we are also developing other products such as on and off-ramp through APIs, the FX through APIs, for example, being able to settle on the other end through APIs as well. So we are in essence building ,what I believe, is the defining infrastructure to be able to seamlessly go from any local currency you want, be it Argentina pesos, Nigeria naira, to USDT, get the payment prefunded, get the FX done on the payments.

I think was one of the most interesting things right now in stablecoins is the rise of local stablecoins, which I think will dramatically change the landscape. So how do you seamlessly go from a USDT to your local stablecoins to the fiat account, and then being able to finally settle the payments in any bank accounts that the fintech wants and going as far as selling it to the third party, like receiver that a fintech like wants to send to.

So we’re doing this, all of this through a very simple API that’s incredibly seamless and that any payment company in the world can use to seamlessly move funds in and out of emerging markets.

Ashley Lannquist: And on the currency side, so there’s the one option of local Nigerian naira, and then that goes to the USDT, Tether, US dollar stablecoin, and then that could then go to Hong Kong dollar fiat with the client. To complete Yvette’s line of questioning, they would have a bank account in Hong Kong to do the cash out? So I just wanted to clarify. There is going to be the naira to US Dollar foreign exchange operation, as well as the US dollar to Hong Kong foreign exchange operation behind that.

And then there’s this option now with local currencies of it going from naira, exchanging into Tether, then Tether into the Hong Kong stablecoin, let’s say. That’s where then, in that case, the foreign exchange operation would happen from USD to Hong Kong dollar, and then it would go from Hong Kong dollar to a stablecoin to the regular Hong Kong dollar without a foreign exchange operation.

I’m curious what the local stablecoin would do in that case. Maybe it’s about liquidity between the US dollar stablecoin and the local fiat, in that case. In some cases, there could be more liquidity on that particular exchange or not. Is that it?

Mouloukou Sanoh: Yeah, definitely. And, that’s a great question. A lot of people always ask, why do we need local stablecoins? I think the reason like we need local stablecoins is very simple because it is much easier, in my opinion, to trade currencies on chain than it is in fiat like the way it currently is. Because if you, let’s say are, if you’re holding like Nigerian naira in its fiat form, you are severely limited by the number of fiat dollars that are available in the country.

For example, and let’s say I’m a larger oil producer in Nigeria and I need $10 million. The bank is going to give you three months to essentially give you those dollars, right? So it’s almost impossible for these business to compete. And same thing like with the fintechs. But if I get USDT, I’m not limited by what’s available on the ground. I’m limited by $300 billion of treasury, like deposits that have essentially been tokenized by, et cetera.

But even going further, those markets are still not the most efficient because I still need to go to somebody who’s usually like a centralized player, give them my naira and they charge a huge margin, because the market is still very illiquid, to essentially get the USDT.

But if I have a local version of a Nigerian stablecoin, and there is one actually called CNGN, and they do really great work, is that you’re able to instantly mint your naira to your bank account, have a digital version of the naira, and because now you have a digital version like of the naira, you can much more seamlessly on chain go from your Nigerian naira, a stablecoin, to your USDT.

And one of the biggest reasons for currency like inflation that we have is because of ill illiquidity. So once there is, once you create more like liquidity, it’ll be much more easier to move between currencies. And I think the best place for that is on chain, right?

So local stablecoins, just to summarize, are really great for being able to instantly like mint to redeem. If there’s a transfer coming into like Nigeria, you can go from a USDT to your Nigerian local stablecoins and back in and out, like to your bank, which makes it so much easier and you can do transactions at less clicks, right?

Ashley Lannquist: So why is moving between the stablecoins more liquid than the fiat for a foreign exchange perspective? Is it just the exchange that you’re using?

Mouloukou Sanoh: Yes. I think it is much more because, mainly because of capital controls that you have in many of these emerging markets where essentially each business is given like a ration of like US dollars. Imagine it like, if you go to the food bank, everybody’s lining up with their plate and wants to get food. In this case, everybody’s going to get US dollars because a lot of these countries have less foreign currency reserve than the demand for the dollar.

So they have to essentially ration it among all the businesses in the country, the country that needs dollars. And as you can think about it, because also a lot of these countries are unfortunately very corrupt, is only the essentially very top companies get allocation to dollars.

And what you often have is that you have a central bank rate. Then you have the rate that your bank gives you, which is a few bps above the central bank, right? And then you have a parallel black market, which is essentially where people get their dollar liquidity from because they can’t get it through like normal avenues. The parallel market is incredibly like opaque.

But then by having a local stablecoin and being able to do that transaction like I’m on chain and especially if there’s more liquidity, there’s much more price discovery. Because there’s much more price discovery, prices have naturally calmed down and it’s so much more efficient as well, right?

So essentially like the reason why the black market hasn’t been able to drive is because they’ve been able to drive on the unavailability of a different means to be able to access dollars, but then now that it’s on chain and you’re limited by $300 billion worth, it’s so much easier to get better prices. And the yields, obviously, and the spreads will naturally go down.

Yvette Bohanan: So Mouloukou, first of all, thank you because you just pulled the bandaid off the injury, the injurious thing that you understand because of your background, right. This illiquidity and how this sort of strata of access to capital plays into the structure that has been around for so long with these correspondent accounts and this need to have this money tied up.

So essentially, right, what we’re saying here is, if you don’t need to have that money tied up, you’re bringing more of funds back to a country, any country. That money then becomes available in a local currency and you don’t have to have this sort of limited access to US dollars, or whatever, within the country controlling people’s access to capital in that country. Am I paraphrasing that correctly? Okay.

And that then basically is going to create liquidity, kind of blow the doors off in some countries of how things have been done for a long time, which really opens up opportunity for these smaller businesses to come into the markets to grow, to scale their business, right.

You’re unleashing a different model globally that then unleashes opportunity for people and I think that is so critically important for people to hear right now, because we’re always talking about, in payments, like the local stuff, right? The rural business owner, and how do you get more payments into digital wallets and things like that. And what you’re doing is you’re coming at this at a macro level and saying, if you can solve this problem, you solve a whole lot of other downstream stuff within the country.

Mouloukou Sanoh: Exactly. Exactly. And then it also, because we sit in a very interesting space in the flow of funds because we are the originator of the transaction that we funded, and because I fund the transaction, I can see number one, where the transactions are going. And I can see the bottlenecks because right now my fintechs, my clients use so many different providers for all the different five things that they need to do. I don’t think people understand how nuanced an international cross-border transaction is and how many different players that are actually involved to make sure that at the end of the day you get your money.

So because we have been funding it, we’ve been seeing how fragmented and how incredibly clunky and how incredibly expensive it is. It gives us the opportunity to go out to the market and build the infrastructure ourself and release new products that makes the lives of these fintechs and their operations much more seamless.

Yvette Bohanan: How is this going to affect the local banks in these countries? What’s the good news and is there any bad news for them? That seems to be kind of a big linchpin, right? They’re the regulated entities. Not all banks are able to participate in stablecoin digital assets right now in all countries. Are you talking with banks or their providers? What are you hearing about the banks locally in this sort of transformative phase?

Mouloukou Sanoh: I believe that banks still have a place to play, but it needs to be very strategic. And I think it’s important to separate it by markets. Okay, so if you look at purely, let’s start off with a market that most of your listeners would understand, which is the US or Europe.

I believe that stablecoins become more of a background, of a abstract thing. And for example, tokenized deposits. Everybody, all these banks are talking about tokenizing deposits. A lot of these hedge funds are talking about tokenizing all their funds, right? So on and so forth.

But I think the real opportunity for banks is to be able to be interoperable with these stablecoins, because at the end of the day, the transaction, the end receiver always wants the transaction to be in fiat. They would like to always receive the transaction fiat.

So even though if the cross-border payments, all the payment in the background is being processed over stablecoin rails because they’re much more efficient, at the end, I still want my US dollars. Because I still want to grab my matcha from like Starbucks, for example, right? So I still need hard US dollars in my Venmo accounts or so on and so forth, right?

So I think that the real like opportunity for banks to is to have that interoperability to be able to settle transactions using Swift rails, because at the end of the day, a lot of businesses want their transactions to be set up through Swift rails so they can provide like receipts, right.

So that’s for businesses in Western markets. I think when you look at banks in the sense of emerging markets, I would actually argue that the banks are in trouble. Because number one, they haven’t provided the infrastructure that many of these emerging markets needed.

So what you have is that you actually have the rise of mobile money, right? So for example, right, in Kenya, M-PESA is the largest fintech and handles 90% of its economy. Everybody has an M-PESA wallet. In Thailand, everybody has a Grab wallet. And with the Grab wallet, you can pay, you can receive money. In Brazil, right, you have Nubank, right? So these fintechs have actually become the new digital banks and they are the primary way that these people transact. And many of these economies have become like mobile-first, non-cash economies, right? I think banks are, have number one, been in big trouble, because of them.

And then number two, these fintechs have sometimes even better rails than these banks have and much more seamlessly accept transactions. So I believe in emerging markets, banks are in trouble and really need to up the game if they still want to be relevant, especially for global businesses.

Yvette Bohanan: Yeah, you certainly can see that with the rise of Nubank, just as an example, right? But everywhere you, you see this sort of people, businesses and individual consumers, are tired of the friction. They’re tired of the brokenness that you’re talking about in the fragmentation. We always go back to that. I just want to send money as seamlessly as I can send a text message. And when you can solve that, for business to business in particular, which has been an underserved area, for all the reasons we’re talking about, it makes a huge difference.

It changes the game fundamentally for people, and I think the banks are, are realizing that they probably are trying to figure out how to navigate all the regulation or lack of regulation in their country to do some of that in the way that you’re suggesting though, right? So, but not only are they kind of on their back foot, but then this whole new technology is not necessarily clear to every bank in the world how, what they can and can’t do with it. Right. So we’re in a messy middle right now with everybody.

One of the questions we get a lot around stablecoins. Today, stablecoins are backed a lot by US dollars. You’re talking a lot about US dollars when you’re walking through these examples. How does the solution of solving for liquidity, kind of at the macro level, does that move us away from needing a global reserve currency? Ultimately are we kind of pulling out from that by allowing people and kind of liberating, I guess is the word I’m looking for, liberating sort of the local economies in this way?

Mouloukou Sanoh: No, not at all. Like I believe that for the foreseeable future, the USD will actually continue to be the dominating global reserve currency. And this is what the treasury actually realized. Not to get political, but I think one thing that the Trump administration got extremely spot on, which Biden didn’t see, and his administration, is that stablecoins actually help improve dollar hegemony rather than reducing it.

Because number one, you are finding new buyers of US treasuries. And number two, it’s the best marketing, because everybody wants to hold US dollars. Everybody wants US dollars, right? So, and it’s the best medium of trust between different businesses. If I am in Nigeria and you are in Argentina, we’re not going to start using like Chinese yuan. We’re going to use something that we both trust. And that has been trusted for the past 50 years, right, since Bretton Woods.

So I think that the dollar still has such an important place to play and I think it’s only going to get even better. Because if you look at Tether, Tether has 400 million users and I think that can still go 10X. I think that we can still go 10X. So I think we’re at the beginning of that and I think there’s so many people in the world who still don’t have access to US dollars.

And I know that people talk about the Chinese yuan becoming the next major currency, but the issue is that the Chinese yuan is not really traded. Like you have the offshore yuan, you have the onshore yuan, and I don’t think the, and I actually studied Chinese history. The Chinese Communist Party doesn’t engage in things that they cannot fully control, so they will never let the Chinese yuan be fully traded. So if the Chinese yuan can never be fully traded, then the only real option is the US dollars.

Yes, you can talk about, in some very big government to government projects or some very big transactions, much more transactions are going to be settled in RNB and in yuan. But the majority of retail B2B and normal transactions, I believe, will still be in dollar.

Yvette Bohanan: That’s really interesting. I am glad you kind of brought that perspective in. I think you have a unique perspective with your background, and that was a question we get all the time. We just did an alumni session from our workshops, and it was like, the number one question is what’s going to happen? What do you think? So I always ask people about their perspective on that, and I love that you shared yours.

Ashley Lannquist: It seems a bit intuitive. I like it as well, that we kind of see a lot of usage of US stablecoins, even if it’s moving in and out of the local currency. Stablecoins, just as reinforcing it as a liquid currency to go in and out of. And we have more than 99% of the total stablecoin volume that’s in US dollars even as there’s some local currency stablecoins being proliferated. So I just looked at, it’s interesting how the US dollars stablecoins continue to be used with their liquidity and some of them offer yields depending on which ones.

Maybe that’s a question to go on a detour. Are any of your clients, are there any like visions or is it, I don’t know if there’s a regulatory constraint on some kind of a yield on your customer’s account off of the USDT? I don’t know as well how USDT tends to work.

Mouloukou Sanoh: Yeah. And this always makes me laugh because I think it’s that, when you’re trying to prevent your local currency shedding 300 to 500% against the dollar, you don’t care about yield. You just want to protect yourself, right? So I think the yield discussion is great when you’re in the US, when your savings account gives you nothing, right? Or like when you’re in Europe, I think that works. It’s great product market fit. I think it’s incredibly like easy to understand.

And I do believe that a lot of the stablecoins in Western markets should give the users access to some of the yield that they get from buying like US treasuries, especially over the past few years. Look at the profitability of a company like Tether. I think they made $10 billion in profit last quarter, which is insane.

I think in other like emerging markets, they don’t really care about the yield because like even if you add the yield up for the next a hundred years, it still doesn’t really make up for what we could potentially lose just from mismanagement of the country’s finances, which nose dives, right, like their currency. I mean, look at Argentina, for example. If Bessent didn’t set up that $40 billion bailout today, we’d be talking about how badly the peso has like a nose dive, right? That’s what literally saved the Argentina peso.

I think people always think that stablecoin is a one glove fits all. And I think it’s very important to look at it per region and look at actually what makes sense given the context of each country and where they are at in their development lifecycle.

Yvette Bohanan: Yeah, I think that’s really critical. And so, the other piece of that though too is we are always looking for sort of the reinforcing, kind of virtuous cycle for adoption, right? And when you think about businesses being able to have more liquidity through a mechanism like the stablecoins, come into a local stablecoin, do you see a reinforcing opportunity here for local stablecoin currency to stay within stablecoin and have them paying local suppliers this way and then accepting this?

Does this sort of have a trickle down effect into the day-to-day, sort of whatever the business is doing, either with local supplier payments or their customers within a country to create more of a faster seamless environment, or do you see that conversion happening at the business level and then having the fiat kind of still controlling?

And the reason I’m coming at this question, Mouloukou, this way is, a lot of the conversations in countries that have more of this sort of emergent capability, they’ve invested a lot in fast payment or instant payment system trying to do this, sort of keep it within the digital environment and this is sort of now showing up at a macro level at a cross-border level with stablecoins.

Where do you see that intersection happening, or how do you see that playing out with kind of creating a virtuous cycle here? Is there room for both of these systems? How does this work in your mind?

Mouloukou Sanoh: I think the best system is one that enables interoperability between both of them. And like you made a really great point is that in many of these, like emerging markets, they’ve been really focused on making payments faster and making payments settle instantly. Like a big example of this is Pix in Brazil, where your payments go at the essentially speed of light.

And I think a local stablecoin, and they’re going to be a bunch of them, it’s going to be multiple local stablecoins in each country. I think a local stablecoin is as good as the ability for it to be interoperable with the local banking rails. So if I can go from my local bank account, instantly mint to redeem that local stable, go on chain, get USDT, vice versa with just a few clicks from my bank and then do a local transfer, which is instant, I think that would be like a game changer.

So to answer your question, I think it needs to be a mixture of both, and I think that also plays to, and this is my opinion, but I don’t think stablecoins will have their own financial ecosystem. I think that stablecoins should be the cherry on top of what we’ve already built and should just make things more efficient that way. Because I don’t ever see my mom going on Coinbase and buying gas so that she could buy like USDC, or my grandma, or Starbucks or like having a long line in Starbucks, people trying to figure out how to off ramp right there at the checkout, right? So yeah, I think it would mainly be like an abstract thing.

Yvette Bohanan: Yeah. Yeah. No, I think you’re right actually. But I think this is something people are trying to put together, the puzzle they’re trying put together. And I think, unfortunately, in the last, I want to say 10-ish years or so, there’s been this notion that blockchain as a tech stack, horizontal technology, and fast payment systems, ISO 20022 and all that, like as a tech are competing and we have to kind of stop doing that to ourselves, right?

It’s like saying Pearl and JavaScript or whatever and whatever, are competing. It’s like, no, they’re not competing with each other. But I think it’s just this structure that we’ve put around our thought process that needs to be broken so that we can kind of get to the solution space with everyone.

Okay. Mouloukou, I have got to say I’ve been doing podcasts now with Glenbrook for several years. I have never gone off script so much with any guest. But we’ve covered everything, but we’ve just like threw the script out the window and started talking and it’s been so much fun.

But I’m going to come back, I’m going to come back to the final question. This has been super delightful. But if you could sort of wave a magic wand and fix all of this right, from that macro perspective, through the PSPs, the way you’re doing it, what would the liquidity landscape look like five years from now in these emerging markets, in these countries that have had these issues with capital? What would it look like?

Mouloukou Sanoh: It’s a very interesting question. I think I want to answer it from a much broader, stablecoin perspective. I think in the next five years what I would love to see is I would love to see efficient on and off-ramps. So being able to seamlessly as a business go from any amount in your local currency to your dollar stablecoin, preferably USDT.

Being able to do the on chain FX between your local stablecoin and the USDT having, having. Very liquid markets that have enough price discovery and have enough like participants where it goes against and competes and sometimes even surpasses the, the deep black markets that we have in many of these currencies.

Having a network of banks that will take the stablecoin off you and give you fiat and also having. The ability to be able to send those fiat in country or cross-border. So much more seamless. So this is what we are focused on at MANSA, we’re doubling down into emerging markets, hoping to be the bridge and the infrastructure that makes this stablecoin future possible.

And hopefully in the next five years we’ll be able to achieve that.

Yvette Bohanan: That would be a brighter world for everyone, I hope. I wish you every success in doing that. Alright. It has been absolutely delightful, illuminating. Ashley, thank you for being here with me. And Mouloukou, thank you for joining us on the podcast. I hope that all our listeners have learned a little bit more and broadened their perspective on what’s going on in this incredibly fast moving right now and dynamic space of stablecoins. So thank you so much for spending time on this episode.

Mouloukou Sanoh: Appreciate it. Ashley and Yvette, thank you so much for having me. It was a very delightful conversation.

Yvette Bohanan: And to all of you listening, thanks again for joining us and until next time, keep up the good work. Bye for now.