Checkout.com CEO says crypto ‘stablecoins’ could one day run the world
I’m writing to you today from the Web Summit in Lisbon where I’m having many mask-muffled conversations with executives in between pastel de nata noshings. If the Consumer Electronics Show in Las Vegas is the Super Bowl of tech conferences, one could say Web Summit is the World Cup.
On the main stage this afternoon, I interviewed Guillaume Pousaz, chief executive and founder of Checkout.com. The London-based financial tech firm is one of the world’s top 20 most valuable startups, last privately valued at $15 billion in January. The appraisal ranks Checkout as the third most valuable fintech in Europe, next to Klarna ($46 billion) and Revolut ($33), both of which are customers.
Checkout’s seemingly sudden success was a long time in the making. After dropping out of college in Switzerland in the mid-2000s, Pousaz moved to California to surf. There he learned about the rapid growth of e-commerce, a discovery that would prove fortuitous. Pousaz rode that new wave, founding a related business in 2009 that would, three years later, become Checkout. He built the London-based company into a quiet giant, mostly flying under the radar until it raised its first outside funding at a $2 billion “unicorn” valuation in 2019.
Things have only heated up since then; the COVID-19 pandemic has treated the company especially well. Many people, consigned to government-mandated lockdowns, shifted their purchasing habits online. Pousaz said he was initially uncertain whether this digital acceleration, which he estimates sped up e-commerce adoption by about three years, would last. He is now confident the trend will not reverse after seeing it sustain even as the world reopens.
One of the biggest benefiters of the digital shift is crypto, as demonstrated by the recent rocket-like rise of Bitcoin and other digital coins. U.S. regulators just dropped a long-awaited paper regarding so-called stablecoins, digital currencies that are designed to maintain a fixed price, a characteristic that makes them, in theory, suitable for e-commerce. As my colleagues Declan Harty and Rey Mashayekhi report, America’s top financial regulators are pointing out their risks and calling on Congress to pass legislation that would treat stablecoin issuers as banks.
While Pousaz told me he is bullish on digital currency, he doesn’t own any crypto personally. (Each of Pousaz’s three kids own one Bitcoin and one NFT, or non-fungible token, a buzzy crypto concept, apiece, he said.) He even sees a future in which stablecoins “underpin everything.” It’s just a “better technology” than what existed before, he said.
While the folks in government acknowledge stablecoins’ potential to “support faster, more efficient, and more inclusive payments options,” they’re far more worried about what they deem a present lack of investor protections and threats to financial stability.
Dude, where’d my EV go? A week after Hertz unveiled an order for a whopping 100,000 Tesla electric vehicles for a green fleet of rental cars, Elon Musk says the contract has yet to be signed. Hertz responded to the Tesla CEO’s claim (relayed to the public by what else but Twitter) by doubling down on its initial announcement, adding that the Tesla deliveries have already started, creating a swirl of confusion that Tesla investors seemingly didn’t want any part of. Tesla shares ended the day down more than 3%. Hertz’s stock, on the other hand, was up more than 2% by the close. The rental car market’s big winner on Tuesday was Avis Budget, though the exact reason's still not clear. The company’s stock soared Tuesday by more than 100%, following its latest quarterly earnings (which blew past analyst expectations and included insights from CEO Joe Ferraro on how the company plans to adopt more EVs in its own fleet, too).
First goes Facebook the name. Now goes the face technology. Following years of privacy concerns, lawmaker outrage, and lawsuits, Meta, the new parent company of Facebook, on Tuesday announced it would abandon the technology that allowed automatically identified users' friends in photos uploaded to the social networking site. The company attributed the decision partly to those concerns and the role of facial recognition in society. The technology, according to The New York Times, had helped Facebook build one of the world's largest digital photo databases, which had long been a sticking point for government officials and privacy advocates.
iPads are so out right now. In the latest indicator of the global chip shortage’s ripple effects on Big Tech, Apple has cut back on its production plans for iPads, Nikkei Asia reports. The move comes in part so that the tech giant can allocate more parts for the production of the iPhone 13, which Apple forecasts will be a bigger source of demand than its tablets.
Shaking it up in ByteDance’s C-suite. Shou Zi Chew is stepping down as ByteDance’s CFO to run TikTok full time as CEO, Reuters reported Tuesday. The news comes as China-based ByteDance prepares for cofounder Liang Rubo to take over as CEO in December from chairman Zhang Yiming, who announced his plans to step down as CEO earlier this year. The news Tuesday also included a restructuring of ByteDance’s business, which will now be split into six units.
FOOD FOR THOUGHT
"You live by the sword, you die by the sword. That's crypto." If, somehow, you hadn't heard about the rise of the Squid Game-inspired cryptocurrency, consider yourself lucky. Following a week during which the SQUID token posted a 310,000% gain, the crypto plunged to, as of Monday morning, $0.003. The token turned out to be just the wild crypto market's latest rug pull, even leaving experienced investors like Luke Hartford on the wrong side of the trade, Wired reported. But, as Hartford said, buyers should beware in the digital asset markets.
From the article:
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BEFORE YOU GO
Algorithms can't flip houses. Beloved by home-curious millennials, Zillow had a good first part of the pandemic. The housing market was on a tear. Website traffic surged. Earnings beat analyst expectations. In February, the company even found itself the subject of a Saturday Night Live skit. But things have taken a drastically different turn in recent months, as Zillow's home-flipping business has seen dramatic losses with more likely on the way. The reason? Its algorithms were leading it to overpay for houses. So, on Tuesday, Zillow said it is quitting the home-flipping business, a move that exacerbated its stock's decline and put it into a class of home buyers who have found themselves over the course of the pandemic asking, what did I get myself into?
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