In this episode of Stableminded , host Drew speaks with Adam Lowe , Chief Product and Innovation Officer at Arculus , to explore how they are building hardware-level security infrastructure for the stablecoin payment card market .
Adam began by reviewing Arculus's development: the company started as a consumer-facing hardware wallet vendor, then gradually transformed into a B2B infrastructure provider—a phase he called " grown-up crypto ." Arculus was the first company to introduce elliptic curve cryptography ( ECC ) into payment cards, creating a truly 3-in-1 card .
It is both a Visa/Mastercard payment card ,
Another complete HD-rated hardware wallet .
It is also a hardware-level Passkey (hardware identity key) , and all of this is integrated into the same secure element.
Adam confirmed that Arculus currently provides underlying card and security capabilities support for several crypto card projects, including Coinbase and MetaMask , and explained why stablecoin payment cards have become one of the fastest-growing application scenarios in the past six months .
During the conversation, a key point gradually emerged: the real limitation to the large-scale adoption of crypto payments is not the crypto technology itself, but rather traditional financial infrastructure. Adam shared some real-world examples from traditional financial institutions—some banks' internal systems are technically incapable of real-time settlement because their core architecture is designed around a T+N settlement cycle. He pointed out that if true instant settlement could be achieved , the improvement in capital efficiency would be enormous: currently, hundreds of billions of dollars are "idle" to cover T+N settlement cycles , and releasing this "dead money" would have a profound impact on the entire financial system.
Adam also outlined his vision for the future payment system, which he called "Global Johnnie Walker" : a world where anyone can cryptographically prove ownership of a digital asset and use it directly for payments anywhere ; the computer system will automatically select and route the most efficient payment channels in the background , without the user needing to know whether the underlying payment method is a bank card, stablecoin, or other settlement mechanism. He further explained why Arculus chose to incubate and grow within CompoSecure rather than following the traditional venture capital funding path; and how their modular product strategy serves consumers, fintech companies, and large banks simultaneously. Finally, Adam emphasized a macro-level judgment: the US dollar remains the most important "export commodity" of the United States , and stablecoins are, for the first time, truly enabling global users to access and use the US dollar with low barriers to entry, programmability, and instant access.
Opening monologue of the program:
I possess various forms of stores of value—securities, cash, cryptocurrencies, digital assets, you name it. I want to be able to travel the world and seamlessly spend these stores of value , rather than being trapped in "islands" of fragmented asset classes and systems. Ultimately, these assets are mine. I possess the private keys. I can cryptographically prove my ownership of these assets. So let me consume them in the most efficient way possible . Here is my cryptographic proof of ownership. The rest is up to the computer: the system determines which path, which route , will most effectively transfer my value and complete the transaction.
Narrator (Program Advertisement) :
You're listening to Season 6 of Rain's Stableminded, sponsored by Rain . Rain helps finance teams build and manage stablecoin-based card projects . Through an API, Rain lets you issue your own-branded cards and unlock new revenue streams. With Rain, users can instantly and compliantly store, transfer, and spend stablecoins in over 150 countries . In this season, we'll explore how Visa, Crossmint, Yellow Card, Arculus, and the state of Wyoming have integrated stablecoin flows into their respective business systems. To learn more, visit rain.xyz .
Drew (Host):
Okay, Adam, how have you been lately? Thank you so much for joining us on the show today.
Adam:
Great, thank you for inviting me.
Drew:
I'm really looking forward to this conversation. You mentioned before that you frequently participate in discussions about stablecoins and payments, and your official backdrop is actually making me a little envious—I might need to get one for myself. From a personal perspective, I'd love to delve deeper into you, your experience, your roles at CompoSecure and Arculus, and especially how what you're doing now truly integrates with cards, payments, and underlying technology . There's so much we could discuss today, thank you so much for taking the time.
Let's start with your background: What is your role in the company? How did you get to where you are now? In my opinion, you are currently in a very crucial position, driving the implementation of this type of new technology within a large company.
Adam:
Of course. My name is Adam Lowe , and I am the Chief Product and Innovation Officer for CompoSecure and Arculus . I have been with Compo for about 12 years. If you look back to when I first joined the company, our core business was actually very simple: making metal cards .
At the time, we primarily served high-end private banking clients; in other words, we were producing very high-end "financial jewelry" every month. But we knew that if the company was to grow, it had to move from a very small group of high-end clients to the affluent masses, and even to the broader mass market. So we wanted to expand our product portfolio.
My initial job was actually very technical. For example, one question was: how to implement tap-to-pay (contactless payment) with a metal card? This was extremely difficult. Because you have to put an antenna inside the metal card, and the antenna is right next to a ground plane. At the time, some people actually told me directly, "This is impossible." But a few years later, we have issued millions of metal contactless payment cards worldwide .
Adam:
For a considerable period of time , I was primarily responsible for expanding the technology – how to truly transform the metal card into a payment product that could be scaled up, mass-produced, and commercially viable.
Then, about four years ago , out of personal interest, and given my background in defense and security before entering the payments industry, I began to have a bigger concern. I was thinking: inside a payment card, there's actually a secure element (security chip) . This chip is responsible for all payment-related mathematical operations and encryption logic. But the problem is—it's like a V12 Ferrari engine being used with only four cylinders . It's essentially doing only one thing, and using only a very small portion of its cryptographic capabilities .
So I started thinking: since everyone is so familiar with and trusts the "card" form, and we can make it very beautiful and very durable, why not let this card do more?
I've always loved this analogy. On the Food Network, Alton Brown famously said, "Your kitchen shouldn't have any tools that can only do one thing." So I've been wondering: why should your card only do one thing?
So we started experimenting with elliptic curve cryptography (ECC) for payment cards. We used it to do two things:
Blockchain-related signature and key management
Security authentication related to Passkey (hardware identity key)
To the best of my knowledge, we are the first company in the entire payment card industry—whether it's metal or plastic cards— to do this.
Adam:
So what does it mean if our card is Arcura enabled today ? It means it 's simultaneously three things :
First, it is, of course, a normal payment card : Visa, Mastercard, Amex , JCB, depending on which network it is issued on.
Second, it's a complete hardware wallet . It's a true HD-level hardware wallet: you generate, store, and manage your private keys on the card.
Third, it's also a complete hardware passkey . Just like someone uses a YubiKey to log in to a system, your passkey is now stored on this card. You can use it to:
Manage your encrypted Passkey wallet
Log in to Coinbase or other custody platforms
Do anything that requires strong identity verification
All of this happens on the card in your pocket . The key is offline , not in the cloud, so there's no risk of cloud attacks.
Drew:
This is absolutely insane. I think most people have no idea how complex this is. What you just described are actually three completely different systems :
Payment network integration
Passkey's security system
Wallets and Custodial/Non-Custodial Systems
Many companies, focusing on just one aspect, are already complete startups. I'd like to return to your background a bit. You just mentioned your previous experience in national security and defense. In your view, to what extent is fintech, especially stablecoins and payment systems, also a security issue ?
Adam:
To a very large extent . First, the origin of the chip is extremely important. Second, there's the code running on the chip . How was this code written in, where was it written in, and who accessed it? This is why, when choosing secure elements, we directly interface with the foundry (fab). Our code is securely injected at the foundry stage and is cryptographically signed .
Drew:
How exactly does this work? Could you explain it briefly?
Adam:
Of course. You can imagine this process: We partner with secure element vendors, such as NXP or Infineon . They then partner with the actual wafer foundries that "grow" the silicon. The foundries are responsible for turning the silicon into chips. During this process, we securely hand over our code to them . When the silicon wafer is "grown," cut, and etched, before the chip is packaged, it contains a small piece of flash memory . It is at that stage that we securely write our code into it.
A single wafer might be 12 inches or 16 inches, containing around 30,000 microcontrollers . The code is written at this stage. Afterward, the wafer is diced, packaged, and ultimately becomes the chip in your credit card.
Therefore you need to be very clear:
Where are chips manufactured?
What is the code flow path?
How are the keys managed?
For me, these are routine tasks, and I sometimes even subconsciously skip them. But in reality, they involve a vast array of security processes, logistics controls, and certification systems . These include, but are not limited to, FIPS, EMVCo, certifications from major payment networks, and ISO standards. All of these combined form an extremely large engineering system . The entire team has put in tremendous effort to ensure that all of these processes are compliant and certified.
Drew:
I think the point you just made is very important. From the outside, what Arculus can do—hardware wallets, identity, security, payments—could easily be a standalone startup. But Arculus wasn't born that way. It was incubated within CompoSecure . Could you elaborate on that? In particular, how did you communicate with the CEO at the time? And how different is your vision of Arculus back then from what we see today?
Adam:
That's a very good question. Let me start with a crucial point: in the payments industry, being "born into the payments system" is extremely helpful. Let's go back about four years. I had been at Compo for about eight years then. I went to see our CEO, John. I told him a few things:
First, I see a rapidly forming space where identity and payments will continue to merge .
Secondly, from a technical perspective , blockchain is faster, cheaper, and better . This isn't a matter of sentiment; it's an engineering fact.
Third, I said: We don't want to stand by the tracks, watching the next generation of railways being built, only to find ourselves without a ticket. We must be at that intersection , able to serve railways of all different "gauges" .
John is a very visionary. I told him, "Give me some money, and I'll give you a digital business ." Four years later, we actually did it. Arculus has become our complete platform in the field of digital assets and digital identity .
Custody and Non-custodial
Safety
Payment
Even POS scenarios (we can talk about that later).
John's judgment is absolutely correct. Arculus is my "child," and I've been with it since four years ago.
Drew:
What were your feelings when you walked into that meeting? Was your relationship with John already quite deep at that time? And has the story of your "selling" back then evolved significantly compared to what actually happened today?
Adam:
Our relationship has always been great. And honestly, no project ever ends up exactly what you initially envisioned . The focus at the time was actually on the consumer hardware wallet . That was Arculus' first product. We still sell a lot of that product now, and I love it. But the core logic at the time was:
This is a new vertical business.
We can utilize the hardware we are already working on.
No need to reinvent the manufacturing system
We are already producing millions of these cards every year.
Now we're just selling it to a new market.
Adam:
As for why I didn't choose to start my own business but instead chose to do this at Compo—I'll say something rather realistic: I'm an extremely risk-reward oriented person. In my mind, I'll do a risk-adjusted reward calculation .
You can imagine that the conversation with John at that time must have included:
My Career Development
My motivation at work
If this business is successful, it will increase the company's value.
These are all real-world issues. You could certainly go to a16z, raise a lot of money, and then see how much equity you'd be left with. That's another option, but it's riskier, the network support is slower, and you have to build everything from scratch.
Doing this within a large company isn't without its challenges. Compo has long been a manufacturing company . Suddenly having to implement software, software licensing, and an execution system almost entirely unrelated to manufacturing internally requires a complete shift in mindset . So, whichever path you choose, there are difficulties. Entrepreneurs face: fundraising, survival, and the weight of everything on their shoulders. Starting a business within a large company requires changing existing paths and convincing those with a long history of manufacturing to accept software development. Therefore, my advice to others has always been: carefully calculate your risk-adjusted return , and then choose the path that maximizes your probability of success.
Drew:
From an external perspective, this choice now looks very correct. Especially with recent partnership announcements such as Coinbase One Card, American Express, and CompoSecure, these relationships will obviously bring a lot of opportunities to Arculus.
Adam:
Yes, that's absolutely true. I remember our first time at Consensus , and even earlier, it was CES, just because the dates were in our schedules. From the beginning when almost nobody knew Arculus, to now at Consensus, everyone knows who we are.
Drew:
I don't think I've ever met anyone who doesn't know Tom.
Adam (laughs):
Tom's everywhere. If there were a leaderboard for "most attended crypto conferences," Tom would definitely be at the top. I can't attend as many conferences as I used to because I have too much to do at Compo. Now it's often the same: Tom's in Singapore, and I'm in Germany. Basically, I'm traveling all over the world.
Drew:
Okay, let's focus on Arculus itself. You secured internal funding, founded Arculus, and are leading this team. Could you explain this systematically?
How did Arculus originally begin?
What kind of evolution has it undergone in recent years?
And at this stage, what is the biggest change compared to the beginning?
Adam:
The biggest change is very clear: the focus has shifted from consumers to B2B. If you look at the B2B encrypted card market:
Coinbase Card (Officially Announced)
MetaMask Card (Officially Announced)
Gemini
And many others
Basically, we make every kind of metal-encrypted card you can think of.
Adam:
Some partnerships are public, some aren't, and I won't go into specifics about which card uses which part of Arculus technology. But generally speaking, we provide our partners with: wallet capabilities, Passkey, and payment network capabilities; they use whichever they need.
Looking back at history: The earliest Arculus cards only had consumer hardware wallets . Later, we gradually added Passkey technology because we also wanted to serve managed scenarios . Initially, Arculus was purely unmanaged; now we support both.
Custody (Coinbase)
Self-hosted (MetaMask, Arculus Wallet)
Because I firmly believe that users should have the right to choose.
I remain very passionate about our consumer products, and I firmly believe they are among the best consumer-grade hardware wallets on the market . However, in terms of business scale, the B2B growth rate is already "exponential."
Drew:
Let's return to the consumer products line. If someone is listening to this program now and is hearing about Arculus for the first time, how would you explain it in one sentence: What is it? Who is it for? What problems does it solve?
Adam:
Let me start by saying something that might seem counterintuitive. Early hardware wallets were actually "deliberately designed to be difficult to use." It felt like a "geek club": you had to understand it to be qualified to use it. I really wanted to change that. We had an internal standard that I called the "Mom Rule" : if I couldn't just hand the product to my mom and she could use it without me having to explain it, then the product was still too complicated.
Therefore, Arculus' consumer product is essentially a hardware wallet . However, its interaction method must be understandable to the average person. What it does is:
Generate a private key on the card
Store the private key on the card
Managing private keys on the card
You have full access to the entire crypto ecosystem.
The usage process is very simple:
The first step is to download our mobile app (free).
The second step is to generate and manage your private key using the Arculus card.
The third step is when you need to perform any operation on the chain—
You only need to:
Stick the card to the phone
Enter PIN
When you enter the app, you have already performed biometric authentication.
This is a true triple independent verification (3FA) .
Adam:
I often tell people: while others are still plugging in USB drives, turning on their screens, and waiting for their devices to boot up, I've already completed the transaction. Because the experience is as fast as swiping a card at a POS machine. And the most crucial point is: your private key is in your pocket, stored offline , running on the same level of security as billions of credit cards worldwide. This system has never been breached .
Drew:
This product has been online for several years, right? In what year did you officially launch it? Looking back now, who were your typical users?
Adam:
Yes, it's been several years. Our typical users are actually in the second stage of their crypto journey . Self-hosting is usually not someone's "first stop."
The first stop is usually:
Robinhood
Coinbase
Any hosted platform
This is a very natural path.
The second stage is:
You have accumulated a certain amount of assets.
Or someone might repeatedly emphasize to you, "Not your keys, not your crypto."
You start to take asset ownership seriously.
At this point, you might think, "Okay, I want to self-host, but which one should I choose?" This is exactly the user base of Arculus.
Of course, there is another type of user:
Highly technology-oriented
Safety is of utmost importance
Even as the first step, I don't want to hand over my assets to a custody platform.
Another interesting phenomenon is that we have a very large XRP user base. Therefore, from a blockchain perspective, there are also some differences in user distribution.
Drew:
What about you? If you were to categorize yourself now, which user category would you be?
Adam:
I self-manage my assets, of course. I have Bitcoin and other assets stored on Arculus, not quite enough to retire (laughs), but a significant portion of my assets are indeed held on Arculus.
Drew:
When did you first come into contact with blockchain? Was it through Bitcoin?
Adam:
Yes, it was Bitcoin. I was a graduate student at the time, right around the time the white paper came out. It's actually quite similar to an episode of *The Big Bang Theory*. In one episode, they said, "Do you guys remember when we read that white paper together a few years ago? Does anyone remember where our private keys are?" Everyone said, "No." That episode really mirrored my life experience. Back then, a few friends and I read the white paper, ran some code on our laptops, mined a little, and played around a bit. And then—the private keys just disappeared.
So I did eventually hold Bitcoin, XRP, and some other assets, and I switched to self-custody very quickly. For me, it wasn't just a technological choice, but also a choice of personality and values .
Drew:
Okay, let's move the timeline forward now. You already have:
Consumer hardware wallet
Card form
Private key security
What happened next was that Arculus clearly began to shift towards a B2B model . How did this path come about? Was it due to a key partnership? Or did it gradually "realize that this had to happen"?
Adam:
I think part of the shift to B2B happened very naturally . When you're doing any business growth, you leverage the resources and networks you already have. At CompoSecure, we have very deep relationships in the traditional payments world . To put it bluntly: we're the kind of company where you can literally call directly...
JPMorgan
American Express
Revolut
N26
and major card issuing and card issuing platforms
Then the other party will be the company that answers the phone.
Adam:
Because of our deep relationships with banks, card issuers, and card-issuing platforms, we almost naturally became the preferred partner for many institutions as stablecoins and Web3 gradually entered the mainstream. They would approach us and say, "We want to truly implement these things in payments; can you help us?"
So we started to do more:
Service card issuing platform (issuer processors)
Service from genuine card-issuing banks
Various payment infrastructure layers in the middle of the service
Essentially, it means grafting our already mature technologies onto our existing banking networks .
Many companies, when developing Web3 products, try to "push the product upstream," but I'm very fortunate that we don't need to do that . Because we are genuinely adding value for our partners :
hardware
software
Smart Contracts
Private Keys and Identity Security
For example, Aptos used our hardware wallet during their major launch; Chain Finance white-labeled our hardware; and several other major partners white-labeled our technology. Add to that the recent official announcements from Coinbase, MetaMask, and others.
Drew:
If I understand correctly, it sounds like Arculus solves some extremely difficult and highly regulated problems . Many builders might think, "We don't want to touch this problem at all; we'll just hand it over to Arculus." In your opinion, what types of problems lead these teams to choose to "give up on doing it themselves" from the outset?
Adam:
This is an excellent question. The core reason can be summed up in one sentence: things become extremely complicated once you touch the traditional payment system.
For example, if you want to put certain logic into a smart card , and that card is Visa or Mastercard, then it's not just a matter of "whether it's technically feasible." It also requires: being audited by the payment network, being authenticated, being formally approved and "blessed"—you not only have to make it work, but you also have to get Visa, Mastercard, and EMVCo to agree.
This process:
Very time-consuming
Extremely high cost
Extremely specialized
And it's very niche.
You must know:
What are the standards?
What is a document?
What is the review process?
More importantly: you don't just review it once.
Drew:
What do you mean? Does it mean every single transaction?
Adam:
Yes. You'll first undergo a comprehensive certification to ensure your system complies with standards. Only then are you "allowed" to assume that every transaction occurring within this system is compliant. However, to achieve this, you must adhere strictly to standards from the design phase. If you're developing tokenized cards or some kind of object-oriented card logic, they operate on extremely stringent protocols . From an engineering perspective, building and maintaining these systems is a very painful process . Therefore, for most teams, it's simply not worthwhile to research all of this from scratch. Coming to us is a more rational choice in terms of cost, efficiency, and risk. This is the first layer of protection.
The second layer of our competitive advantage is patents . CompoSecure holds hundreds of patents in this field, covering areas such as metal cards, Web3 on cards, and Passkey on cards. This is something we take very seriously. It's not an area you can simply "bypass."
The third layer of our competitive advantage is scale . Compo produces millions of cards annually, processes massive amounts of transactions, and serves a large number of Web3 customers. For many teams, their core focus should be on remittances, payment products, and specific vertical businesses, not on reinventing payment cards and security systems . This is precisely where we come in: to let them focus on their mission, while we provide the infrastructure needed to accomplish it.
Drew:
Of all these B2B use cases, is there one that you personally find most exciting and resonates with? I'm not asking you to name clients, but rather to discuss "how Arculus is used."
Adam:
That's a good question. Because Arculus is highly modular , it can be a bit difficult for outsiders to understand. Some people only need one of the three components; others start from scratch and need the whole thing.
As a builder, I really appreciate this modularity. I often use Lego as an analogy: I want to have bricks of all colors and shapes so I can build whatever I really want. But from a sales perspective, it's definitely harder to sell. Because you need: deeper conversations, and the customer truly understanding what they need, rather than the simplistic sale of, "I have a pen, will you buy it?"
The "three-in-one card" we often talk about:
payment card
Passkey
wallet
You can combine them as you like. Need a Passkey server? We have that. Need backend connections to all major blockchains? We have that too.
If the client is very technology-oriented, then we will have very in-depth technical discussions:
What language?
How to optimize performance
Which modules should be used and which should not?
So it all boils down to: understand your customers.
Adam:
I have a vision, and I often talk about it with Tom. I've named it "Global Johnnie Walker ." To be honest, it has nothing to do with whether the beer itself tastes good or not; I just really like the logo .
Drew:
You mean the logo with the cane walking forward?
Adam:
Yes, it's that Johnnie Walker logo. I've always had this image in my mind—a global traveler . This person is "empowered." It's a highly permissionless state. What I'm saying now isn't from a company perspective, just Adam Lowe's personal opinion.
In this world:
I have the private key
I own my assets
I don't need to ask anyone for permission.
I can travel the world; I can buy, sell, and exchange anything I need. I give you value, and you give me value. It's a permissionless exchange of value . In a sense, it's even a bit like going back to the "cash era." Before: money on the hand, goods on the hand. Now: digital assets on one hand , instant value transfer on the other .
If you can accomplish this with the lowest cost and highest efficiency , then you've truly achieved competition. Cost is cost; there are no hidden fees, no layers of intermediary friction. This is the world I hope we can reach.
But we haven't quite arrived yet. To achieve this goal, you must simultaneously serve eight different "gauge" railways . The tracks from which assets enter are different, and the tracks from which they exit are also different. You must be able to:
What track is it coming in?
What track is it to go out?
How to automatically route in the middle
This is extremely difficult. But that's exactly what we're working on behind the scenes. The ultimate ideal is that trains can enter and exit from any gauge without any noticeable difference to consumers and merchants. We haven't fully achieved that yet, but it's the direction I'm striving for every day.
Drew:
I think you've already taken a very big step in that direction. The name "Global Johnnie Walker" itself is very evocative. You also mentioned that you're already doing some very cutting-edge things, such as completing payments directly on the POS side using stablecoin tracks.
Adam:
Yes. You and I have both seen that demo. We can already do it: complete tap-to-pay directly on-chain with stablecoins. Going further, you're not just "paying".
you can:
First, go to DEX
Or go through a centralized exchange.
Automatically switch to the most suitable asset
Complete payment
Arculus itself:
Have a Paxos account
Have a Circle account
We can:
Routing stablecoins
Mint
Burn
It performs a large number of complex operations in the background.
Drew:
So the world you've described is actually the endgame many stablecoin companies are pointing to. Rain is pointing in this direction, and many builders are pointing in this direction as well. From your perspective, how far are we from this reality ?
Adam:
I don't think we're that far off . You've already heard: AMEX is talking about stablecoins, Brian Moynihan (BofA) is talking about stablecoins, and I really don't think it will take another ten years. I was just discussing this with someone a few days ago. The real key question is: how quickly will banks become blockchain companies, or how quickly will blockchain companies become banks? At least in the US, we don't have something like an "Electronic Money License (EMI)." If the US had an EMI, many things would be much easier. The GENIUS Act certainly helps a lot, but if there were an EMI, the whole system would be much simpler.
Drew:
So who do you think the GENIUS Act would benefit more? Banks or blockchain companies?
Adam:
I think overall it's more favorable to the blockchain side . Companies like Circle and Tether may benefit more than traditional banks. The biggest point of contention going forward will be: tokenized deposits vs. stablecoins. This isn't a technical issue, but a regulatory one .
To be honest, I personally hope everyone lives directly in stablecoins. Every mint/burn is actually unnecessary friction. Some people say, "Stablecoins are dead money." That's not true. You can wrap it, earn yield, and then unwrap it to continue spending. I myself hold a lot of wrapped stablecoins, generating yield every day.
Drew:
Based on your assessment, you seem to believe that recent events have brought us much closer to the "world of on-chain native payments" than most people imagine . But I'm curious about one thing: in your view, where is the real uphill climb ? Because the difference between "willingness to do it" and "actual implementation" often lies in the very specific and often messy details of execution.
Adam:
That's an excellent question. The real challenge isn't blockchain, stablecoins, or smart contracts. The real challenge is the back-end infrastructure of traditional finance. Let me tell you about a very common and real-world scenario. I'm drawing a flowchart with a traditional financial institution on a whiteboard. I say, "Okay, we can settle this step in real time." The other party immediately says, "Wait, no. We can't accept payment that quickly."
Drew:
No? That sounds counterintuitive. Why can't we receive the money faster?
Adam:
The reason isn't regulation, but a purely mechanical issue . Their:
Internal ledger
Internal clearing system
Core banking system
It simply cannot handle real-time payments.
Drew:
So the problem lies with the "system brain" itself?
Adam:
Yes. Many traditional financial institutions' back-office systems are built on very outdated architectures. You can think of it as:
The code was written decades ago.
The core logic revolves around the T+N design.
The entire assumption is that "the money won't move that quickly."
So when you suddenly tell it, "The money has arrived now," the system does n't know how to process it .
Adam:
This leads to a very ironic situation: we can already:
Instant transfer between people
Faster money transfers between banks
But at a higher level , that is:
Regional banks
Clearinghouses serving these banks
Then at the central bank level
This supply chain still heavily relies on very old infrastructure. Upgrading these systems is extremely slow. The problem isn't just technology, but rather: who will pay for the upgrades?
Drew:
This sounds like a classic "nobody wants to be the first to move" problem.
Adam:
Absolutely correct. So in my opinion, this is the heaviest stone in the whole system .
Drew:
From a certain perspective, Arculus seems to stand right between these two sides: the new world on one side and the old world on the other.
Adam:
Yes, that's why I said: we serve Web2, Web2.5, and Web3 simultaneously. We can't pretend the old world doesn't exist. You have to be able to communicate with it, be compatible with it, and gradually replace it. Drew:
Let's zoom out to a more specific point. Over the past six months , stablecoin payment cards have become one of the fastest-growing use cases across the entire asset class . You're in a very central position in this space. What are your thoughts on this surge? What role has Rain played in it?
Adam:
I think Rain is very important in the entire ecosystem . In particular:
Their understanding of payment
Farooq's background
Their designed smart contract structure
Both are very "payment-friendly".
Simply put, Rain's model works like this: you deposit stablecoins into a smart contract. This contract settles monthly. If you repay on time, the asset remains there. If you fail to repay, the asset is liquidated to pay off your debt.
From a user experience perspective, it is almost exactly like a traditional credit card : Visa/Mastercard track, merchants are completely unaware, and the settlement logic is familiar, but the underlying asset is actually a stablecoin.
This solves a very real problem. In the Web3 world, there are a lot of DAOs, Web3 companies, and crypto-native teams that hold a lot of digital assets, but their daily lives and operations still take place in the Web2 world. You still have to buy food, book hotels, pay SaaS providers, and pay salaries.
Rain provides a way to truly connect Web3 assets to Visa . For a very concrete example: I might have a lot of BONK. I first exchange my BONK for USDC on Solana. I then deposit the USDC into a smart contract. I swipe my card to buy pizza. At the end of the month: the system automatically clears the account, the USDC is burned, the merchant receives fiat currency, and the process is complete.
Adam:
Our role here is to make all of this "truly happen in the real world." The card is with us. The signature is with us. The wallet is in the card.
When you sign that smart contract, the private key used for signing resides on the card. So: on one hand, we're communicating with Visa; on the other hand, we're signing a Solana/Ethereum contract. These two tracks are completed within the same physically secure object . This is why I say Arculus and Rain are highly complementary . They've implemented smart contracts on many chains, and we've done so on some chains they haven't yet covered. It's a very natural collaborative relationship.
Drew:
I'd like to use a very concrete business example to illustrate what I just said. Our company currently uses Dakota for corporate banking and stablecoin vaults. Through Rain, we now have an embedded card that can be used like a credit card, linked to a Dakota stablecoin account. I haven't received a physical card, nor did I specifically apply for one; it's entirely digital . If I didn't know Rain existed, I might think, "This is a card issued by Dakota itself." So, from your perspective: in this situation without a physical card , is Arcura still part of this process?
Adam:
The answer to this question is: it depends on the specific platform's implementation. In the very specific scenario you described, we are not involved in that chain of operations .
But if the card issuer:
Use Passkey
And used our Passkey product
That would likely involve the identity verification layer . For example, we could use a Passkey to protect your login process on the Dakota platform.
To give another example, if you're using a native Passkey wallet , such as Coinbase's wallet (which they now call Base App), then Arculus is perfectly capable of participating.
Drew (laughing):
I really can't keep up with their renaming.
Adam (laughs):
Me too. But the key point is: the Base App is fully Passkey compatible, and Arculus and it can work together. This actually brings us back to the question you asked earlier: modularity.
We spend most of our time behind the scenes. But "which building block we use behind the scenes" depends entirely on: who the platform is and what the use case is.
Drew:
And what about yourself? You actually use the cards issued by Rain, right?
Adam:
Yes. I personally use the Arculus Enterprise Card issued by Rain .
Drew:
Is this card linked to an Arculus corporate account? Or some kind of corporate expense account?
Adam:
Essentially, it connects to stablecoins . For example, finance gives me a budget of $500. I receive $500 in USDC . I push this $500 USDC into a smart contract. Afterwards: when I travel for work, buy coffee at a meeting, or buy tacos, every transaction generates a receipt and is managed within Rain's system. By the end of the month:
The portion of USDC I consumed
Will be burned
Will be liquidated
Payment will be made to the merchant through the banking system.
For the merchants: This is just a regular Visa transaction . They have no idea that it involves stablecoins.
Drew:
That's really cool. Enterprise spending platforms like Ramp and Brex are growing very rapidly. Do you collaborate with these platforms?
Adam:
Yes, they are all our clients.
Drew:
At least Ramp has publicly stated that they want to integrate stablecoin tracks into corporate spending management. Do you think this is a growing trend?
Adam:
I'm not in a position to comment on specific companies' roadmaps, as that's their own business. However, I can say that our Passkey product is a perfect fit for these types of platforms . Many of these platforms choose professional custodians for their digital assets or stablecoins .
In this mode:
Passkey can be embedded in their internal systems
Used to protect employees
Or protect customer accounts
For example, Passkey is far superior to password for employee identification, employee login, and access to internal enterprise systems .
Drew:
Moreover, in this employee use case, payment functionality may not even be necessary, right?
Adam:
Absolutely correct. The integration of employee ID, access control, payment, and login. We've already done some proof-of-concept work. You can imagine: an employee ID card.
It can:
Swipe card to enter office building
It is also a Visa/Mastercard
It is also a Passkey
you can:
Use it to buy lunch
Use it to tap your computer
Log in to the system via Windows Hello
All of these can be done on the same card . Instead of the current method:
Six systems
Six sets of vouchers
Six isolated security domains
Drew:
This is the charm of modularity, but it also means that your go-to-market strategy is actually quite difficult.
Adam:
Yes. There are indeed many companies in the market that focus on just one aspect. Many of them are very traditional and legacy- oriented . We often encounter this situation: I walk into a large institution or casino and say, "Look, these systems can all be connected." Then I see: six managers overseeing six systems, and each one is difficult to modify. This isn't a question of technical capability, but rather: modifying old systems is slow, messy, and difficult.
Drew:
We're almost at the end. Before we conclude, I'd like to return to a larger question. From your perspective—you're both in the stablecoin world and deeply involved in traditional payment and card issuance systems—what are your thoughts on the stablecoin payment card sector itself ? Especially in emerging markets or some non-dollar countries, what do you foresee as the future?
Adam:
I think we're going to see tremendous growth , primarily in non-dollarized markets . The reason is actually quite simple: they crave dollars . I've been saying this for years, and I will continue to do so: America's most important export is far more than the goods themselves; it's the dollar.
For some time now, I think the US hasn't done a good job on this. Frankly, the "Gensler era" was detrimental to the global accessibility of the dollar. We should have been actively promoting the global use of the dollar through stablecoins and expanding its influence. But instead, we chose to tighten, close, and hesitate. Now things are changing. We're starting afresh: encouraging access to the dollar through stablecoins. This is a very good thing for the US.
What does this mean? It means:
More people around the world are using the US dollar.
Demand for US Treasury bonds rises
The foundation of the US financial system is more solid.
Therefore, I believe:
Emerging markets
Remittance scenario
Stablecoin-based consumption
They will continue to erupt.
Another advantage of stablecoins that is often overlooked in the US because it doesn't sound as "sexy" is: capital efficiency.
In the current payment system, due to T+N settlement , a large amount of funds are forced to remain as collateral. As the issuer and payer, to cover weekends, holidays, and settlement delays, you must prepare millions, even tens of millions of dollars in advance. This money just sits there, generating no efficiency or creating value—it's utterly "dead money ." But if you can achieve real-time settlement and a good funds model , the money will truly be there. You can release a huge amount of locked-up capital. This is an extremely significant efficiency improvement .
Drew:
Adam, this was a truly excellent conversation. One last question: If someone were listening to this today, and they were either already in the stablecoin industry or about to enter it, what would you say to them? Or, to put it another way: Who is a good fit for Arculus? And who might not be?
Adam:
I think Arculus is for people who want to seriously do "grown-up crypto." I'm not talking about memes, 8-bit cats, or some interesting but highly niche stuff. Those things certainly have their value, but that's not our focus.
What we want to do is:
Change payment
Expanding the accessibility of the dollar
Improve global financial efficiency
What I want to say to the stablecoin and digital asset industry is this: if you are truly at the intersection of Web2 and Web3 , and you want to build payment and financial infrastructure, you will find that serving railways with different "gauges" is an extremely difficult task. I can say very frankly that I have "consumed several years of my life" in order to make Arculus serve Web2, Web2.5, and Web3 simultaneously.
So my invitation is this: if you're doing this, or planning to do this, we've already built a very powerful platform . If there are parts we can't do, I'm almost certain we have very good friends who can fill those gaps. Let's form an alliance, truly get things done, and truly change the world. That's what gets me into the office every day.
Drew:
That was fantastic. Adam, thank you so much for your time today. This was truly a very valuable conversation. I completely agree with your concept of "mature cryptography." I feel that more and more people are moving from the "dabbling stage" to the real building stage. It's been a very pleasant experience working with you and Tom over the past few months. Thank you again.
Adam:
Thank you. I had a very enjoyable chat.
