How Stablecoin Payment Cards Work: Security Architecture × Payment Settlement Channels, Adam Lowe (Arculus)

In this episode of Stableminded, host Drew engages in a conversation with Adam Lowe, Chief Product and Innovation Officer of Arculus, delving into how they are building hardware-level security infrastructure for the stablecoin payment card market.

Adam first reviews the development history of Arculus: the company initially started as a consumer hardware wallet manufacturer and gradually transformed into a B2B infrastructure provider—he refers to this phase as "grown-up crypto." Arculus is the first company to introduce Elliptic Curve Cryptography (ECC) in payment cards, creating a truly 3-in-1 card:

• It is a Visa / Mastercard payment card,
• It is a full HD-level hardware wallet,
• It is also a hardware-level Passkey, all integrated within the same secure element.

Adam confirms that Arculus currently provides underlying card and security capabilities for several crypto card projects, including Coinbase and MetaMask, and explains why stablecoin payment cards have become one of the fastest-growing application scenarios in the past 6 months.

During the conversation, an important point emerges: the real limitation to the widespread adoption of crypto payments is not the technology itself, but the traditional financial infrastructure. Adam shares some real cases from traditional financial institutions—some banks' internal systems cannot technically accept real-time settlement because their core architecture is designed around T+N clearing cycles. He points out that if true instant settlement could be achieved, the capital efficiency gains would be immense: currently, the amount of "idle" funds to cover T+N clearing cycles reaches hundreds of billions of dollars, and once this "dead money" is released, it will have a profound impact on the entire financial system.

Adam also shares his vision for the future payment system, which he calls "Global Johnnie Walker": in this world, anyone can cryptographically prove their ownership of a digital asset and use it for payments anywhere directly; computer systems will automatically select and route the most efficient payment channels in the background, without users needing to care whether the underlying asset is a bank card, stablecoin, or another settlement track. He further explains why Arculus chose to incubate and grow within CompoSecure rather than following the traditional venture capital funding path; he also elaborates on how their modular product strategy serves consumers, fintech companies, and large banks simultaneously. Finally, Adam emphasizes a macro-level judgment: the 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 dollars in a low-threshold, programmable, and instant manner.

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Opening Monologue:
I have various forms of value storage, whether it's securities, cash, cryptocurrencies, or digital assets. I want to travel the world and seamlessly spend this value storage, rather than being trapped in "islands" formed by various asset classes and systems. After all, these assets are mine. I own the private keys. I can cryptographically prove that these assets belong to me. So please let me consume them in the most efficient way. This is my cryptographic proof of ownership of these assets. The rest is up to the computer: let the system determine which path and which track can most effectively transmit my value and complete the transaction.

Narration (Program Advertisement):
You are listening to Season 6 of Stableminded, sponsored by Rain. Rain helps financial teams build and manage stablecoin-based card projects. With a single API, Rain allows you to issue your own branded cards and unlock new revenue streams. Using Rain, users can store, transfer, and spend stablecoins instantly and compliantly in over 150 countries. In this season, we will explore how Visa, Crossmint, Yellow Card, Arculus, and Wyoming in the United States are embedding stablecoin flows into their respective business systems. To learn more, visit rain.xyz.

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Drew (Host):
So, Adam, how have you been lately? Thank you so much for joining the show today.

Adam:
I'm great, thank you for having me.

Drew:
I'm really looking forward to this conversation. You mentioned that you often participate in discussions about stablecoins and payments, and your formal background really makes me a bit envious—I might need to get one for myself. Personally, I really want to dive into your background, your experiences, your role at CompoSecure and Arculus, especially how what you're doing now truly integrates with cards, payments, and underlying technology. There’s so much to discuss today, and I really appreciate you taking the time.

Let's start with your background: what is your role in the company? How did you get to this position? It seems to me that you are in a very critical position, driving the adoption of this kind of new technology within a large company.

Adam:
Of course. My name is Adam Lowe, and I am the Chief Product and Innovation Officer of CompoSecure and Arculus. I have been working at Compo for about 12 years. Looking back to when I first joined the company, our core business was actually quite simple: making metal cards.

At that time, we primarily served high-end private banking clients, to put it bluntly—we were producing some very high-end "financial jewelry" every month. But we knew that for the company to grow, we had to move from a very niche high-end clientele to the affluent mass market, and even broader mainstream markets. So we wanted to expand our product portfolio.

My initial work was very technical. For example, one question was: how do you achieve tap-to-pay (contactless payment) with a metal card? This was very challenging. Because you need to put an antenna in the metal card, and right next to the antenna is the ground plane. At that time, someone actually told me directly, "It's impossible." But a few years later, we had issued millions of metal contactless payment cards globally.

Adam:
So for quite a long time, I was mainly responsible for technical expansion—how to truly make the metal card a scalable, mass-producible, commercially viable payment product.

Then about four years ago, driven by my personal interest and my background in defense and security before entering the payment industry, I began to develop a larger awareness of the issue. I was thinking: inside a payment card, there is actually a secure element. This chip is responsible for all payment-related mathematical operations and encryption logic. But the problem is—it's like having a V12 Ferrari engine but only letting it run on four cylinders. It is only doing one thing and using a very small portion of its cryptographic capabilities.

So I started to think: since everyone is so familiar and trusting of the "card" form factor, and we can make it very beautiful and durable, why not let this card do more?

I have always liked a metaphor. On Food Network, Alton Brown has a very famous saying: "Your kitchen should not have tools that only do one thing." So I was thinking: why can’t your card only do one thing?

Thus, we began to try to introduce Elliptic Curve Cryptography into payment cards to do two things:

• Blockchain-related signing and key management
• Passkey (hardware identity key) related security authentication

As far as I know, in the entire payment card industry—whether metal cards or plastic cards—we are the first company to do this.

Adam:
So today, our card, if it is Arculus enabled, means what? It means it is three things at once:

First, it is of course a normal payment card: Visa, Mastercard, Amex, JCB, depending on which network you issue it on.

Second, it is a complete hardware wallet. It is a true HD-level hardware wallet: you generate private keys, store private keys, and manage private keys on the card.

Third, it is also a complete hardware Passkey. Just like someone uses a YubiKey to log into a system, now your Passkey is on this card. You can use it to:

• Manage your crypto Passkey wallet
• Log into Coinbase or other custodial platforms
• Do anything that requires strong identity authentication

All of this happens on this card in your pocket. The keys are offline, not in the cloud, so there is no risk of cloud attacks.

Drew:
This is really crazy. I think most people are completely unaware of the complexity involved here. What you just described is actually three completely different systems:

• Payment network integration
• Passkey security system
• Wallet and custodial/non-custodial systems

And many companies might focus on just one of these points and already be a complete startup. I want to go back to your background a bit. You just mentioned you have experience in national security and defense. In your view, to what extent is this fintech, especially the current stablecoin and payment systems, also a security issue?

Adam:
To a very large extent. First, the source of the chip is extremely important. Second, it’s the code running on the chip. How this code is written, where it is written, and who has accessed it. That’s also why when we choose a secure element, we connect directly to the foundry (fab). Our code is securely injected at the foundry stage and is cryptographically signed.

Drew:
How does this work specifically? Can you explain a bit?

Adam:
Of course. You can imagine a process like this: we work with secure element vendors, such as NXP or Infineon. They then work with the actual silicon foundries. The foundry is responsible for turning silicon into chips. During this process, we securely hand over our code to them. When the silicon is "grown," cut, and etched, there is a small piece of flash memory inside the chip while it is still in wafer form and has not yet been packaged. At that stage, we securely write the code into it.

A wafer might be 12 inches or 16 inches, containing about 30,000 microcontrollers. The code is written at this stage. Afterward, the wafer is cut, packaged, and finally becomes the chip in your credit card.

So you need to be very clear about:

• Where the chip is produced
• What the code flow path is
• How the keys are managed

For me, these have become part of my daily work, and I sometimes even "skip over" them unconsciously. But in reality, it involves a lot of security processes, logistics control, and certification systems. Including but not limited to: FIPS, EMVCo, certifications from major payment networks, ISO standards. All these things piled together form an extremely large engineering system. The entire team has put in a lot of effort to ensure that all these things are compliant and certified.

Drew:
One point you just mentioned is very important. From the outside, what Arculus can do—hardware wallets, identity, security, payments—could easily be spun off into separate startups. But Arculus was not born that way. It was incubated within CompoSecure. Can you elaborate on that? Especially how you communicated with the CEO at the time? And how different was your initial vision for Arculus from the Arculus we see today?

Adam:
That's a great question. Let me start with a key point: being "born in the payment system" in the payment field is a huge advantage. Going back about four years, I had been at Compo for about eight years. I went to our CEO—John. I told him a few things:

First, I see a space rapidly forming: identity and payments will definitely continue to merge.

Second, from a technical perspective, blockchain is faster, cheaper, and better. It's not 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 we have no tickets. We must stand at that intersection where we can serve all different "gauges" of railways.

John is a very visionary person. I told him: give me some money, and I will give you a digital business. Four years later, we indeed achieved that. Arculus has become our complete platform in the direction of digital assets and digital identity:

• Custodial and non-custodial
• Security
• Payments
• Even POS scenarios (we can discuss this later)

John's judgment was very correct. Arculus is my "child," and I have brought it from four years ago to where it is today.

Drew:
So how did you feel walking into that meeting? Was your relationship with John already deep by then? And how much has the story you were "selling" evolved compared to what has actually happened today?

Adam:
We have always had a good relationship. And to be honest, no project ever ends up looking exactly like your original vision. At that time, the focus was actually on consumer hardware wallets. That was Arculus's first product. We still sell a lot of that product, and I really like it. But the core logic at that time was:

• This is a new business vertical
• It can leverage the hardware we are already making
• There’s no need to reinvent the manufacturing system
• We are already producing millions of cards of this form every year

Now we are just selling it to a new market.

Adam:
As for why I chose not to go out and start a new venture but to do this within Compo—I would say a rather pragmatic thing: I am extremely risk-reward oriented. In my mind, I do a risk-adjusted reward calculation.

You can imagine that my conversation with John also included:

• My career development
• My incentives within the company
• The incremental value to the company if this business succeeds

These are all practical issues. You can certainly go to a16z, raise a lot of money, and then see how much equity you have left. That’s another choice, but it carries higher risks, slower support networks, and you have to build everything from scratch.

Doing this within a large company also has its challenges. Compo has long been a manufacturing company. Suddenly doing software, software licensing, and executing systems that have almost nothing to do with manufacturing is a paradigm shift. So no matter which path you choose, there are difficulties. Entrepreneurs face financing, survival, and everything resting on their shoulders. Starting a venture within a large company means changing existing paths and convincing people who have long been in manufacturing to accept software business. So my advice to others has always been: calculate your risk-adjusted rewards and then choose the path that maximizes your chances of success.

Drew:
From the outside, this choice now looks very correct, especially with some recent partnership announcements. For example, the Coinbase One Card, American Express, CompoSecure—these relationships will obviously bring a lot of opportunities back to Arculus.

Adam:
Yes, indeed. I remember our first time attending Consensus, and even earlier at CES, just because the timing happened to align. From almost no one knowing Arculus at the beginning to now, when we go to Consensus, everyone knows who we are.

Drew:
I don’t think I’ve seen anyone who doesn’t know Tom.

Adam (laughs):
Tom is everywhere. If there were a leaderboard for "most attended crypto conferences," Tom would definitely be at the top. I can’t run around to as many conferences as I used to because I have so much going on at Compo. Now the situation is often: Tom is in Singapore, and I’m in Germany. Basically, we’re running all over the globe.

Drew:
Alright, let’s officially focus on Arculus itself. You secured internal funding, established Arculus, and you’re leading this team. Can you systematically discuss:

• How Arculus initially started
• What kind of evolution it has gone through over the years
• And what the biggest changes are at this stage 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 crypto card market:

• Coinbase Card (officially announced)
• MetaMask Card (officially announced)
• Gemini
• And many others

Basically, any metal crypto card you can think of, we are working on.

Adam:
Some partnerships are public, and some are not, so I won’t specify which card uses which part of Arculus technology. But overall, we provide partners with: wallet capabilities, Passkey, payment network capabilities—they use whichever part they need.

Looking back historically: the earliest Arculus cards only had consumer hardware wallets. Later, we gradually added Passkey technology because we also wanted to serve custodial scenarios. Initially, Arculus was purely non-custodial; now we support both:

• Custodial (Coinbase)
• Self-custody (MetaMask, Arculus Wallet)

Because I always believe: users should have the choice.

I still love our consumer products, and I firmly believe it is currently one of the best consumer-grade hardware wallets on the market. But in terms of business scale, the growth rate of B2B has already become "exponential."

Drew:
Let’s return to the consumer product line. If someone is listening to the show right now and hears about Arculus for the first time, how would you explain in one sentence: what is it? Who is it for? What problem does it solve?

Adam:
Let me start with a possibly counterintuitive statement. Early hardware wallets were actually "deliberately made difficult to use." It felt like an "geek club": you had to understand it to be worthy of using it. I really want to change that. We have an internal standard that I call the "Mom Rule": if I can’t hand this product directly to my mom and she can use it without me explaining, then the product is still too complicated.

So Arculus's consumer product is essentially a hardware wallet. But its interaction method must be understandable to ordinary people. What it does is:

• Generate private keys on the card
• Store private keys on the card
• Manage private keys on the card

You have complete access to the entire crypto ecosystem.

The usage process is very simple:

Step one, you download our mobile app (for free).
Step two, you use the Arculus card to generate and manage your private keys.
Step three, when you need to do anything on-chain—
You just need to:

• Tap the card to your phone
• Enter your PIN
• And since you’ve already done biometric authentication when entering the app

This is truly three-factor authentication (3FA).

Adam:
I often tell people: when others are still plugging in USBs, turning on screens, and waiting for devices to boot, I’ve already completed the transaction. Because the experience is as fast as swiping a card at a POS terminal. And the most crucial point is: your private keys are in your pocket, stored offline, running on the same level of secure operating system as billions of credit cards worldwide. This system has never been breached.

Drew:
This product has been live for several years now, right? What year did you officially launch it? Looking back now, who do you see as the typical user?

Adam:
Yes, it has been a few years. Our typical user is actually a second-stage user in their crypto journey. Self-custody is usually not someone's "first stop."

The first stop is usually:

• Robinhood
• Coinbase
• Any custodial platform

This is a very natural path.

The second stage is when:

• You have accumulated a certain amount of assets
• Or someone repeatedly emphasizes "Not your keys, not your crypto"
• You start to take asset ownership seriously

At this point, you think: "Okay, I want to self-custody, so which one should I choose?" That’s exactly the user group for Arculus.

Of course, there’s another type of user:

• Very tech-oriented
• Highly value security
• Even at the first step, they don’t want to hand their assets over to custodial platforms

Another interesting phenomenon is: we have a very large XRP user base. So from a chain perspective, there is also some variation in user distribution.

Drew:
And what about you? If you were to categorize yourself, which type of user do you belong to?

Adam:
I am definitely self-custody. I hold Bitcoin and some other assets on Arculus, although the amount isn’t enough for retirement yet (laughs), but indeed a considerable portion of my assets is on Arculus.

Drew:
When did you first get into blockchain? Was it Bitcoin?

Adam:
Yes, it was Bitcoin. I was in graduate school at the time, just when the white paper came out. This is actually quite similar to an episode of The Big Bang Theory. They have an episode where they say, "Do you remember that white paper we read together a few years ago? Does anyone remember where our private keys are?" Everyone says, "No." That episode really resonates with my life experience. At that time, a few friends and I read the white paper, ran some code on our laptops, mined a little, played a bit, and then—well, the private keys just disappeared.

So later, I did hold Bitcoin, XRP, and some other assets, and I quickly transitioned to self-custody. For me, this is not just a technical choice but also a choice of character and values.

Drew:
Alright, let’s push the timeline forward. You already have:

• Consumer hardware wallets
• Card form factor
• Private key security

What happened next is that Arculus clearly began to lean towards a B2B model. How did this path emerge? Was it a key partnership? Or did you gradually "realize this had to happen"?

Adam:
I think part of the shift to B2B was actually very naturally occurring. When you are growing any business, you will leverage the resources and network of relationships you already have. And at CompoSecure, we have very deep relationships in the traditional payment world. To put it bluntly: we are the kind of company that can actually call up:

• JPMorgan
• American Express
• Revolut
• N26
• And various major issuing banks and platforms

And they will answer the phone.

Adam:
Because we have such deep relationships with banks, issuing institutions, and issuing platforms, when stablecoins and Web3 began to gradually enter the mainstream, we almost naturally became the preferred partner for many institutions. They come to us and say, "We want to truly implement these things into payments; can you help us?"

So we began to serve more:

• Issuer processors
• Actual issuing banks
• Various layers of payment infrastructure in between

Essentially, we are integrating the mature technology we have already developed into the existing banking network.

Many companies trying to build Web3 products will attempt to "push products upstream," but I am very glad we don’t need to do that. Because we are genuinely adding value for our partners:

• Hardware
• Software
• Smart contracts
• Private key and identity security

For example: Aptos used our hardware wallet during their major release; Chain Finance white-labeled our hardware; and some very large partners have white-labeled our technology. Plus, with the recent announcements: Coinbase, MetaMask, and so on.

Drew:
If I understand correctly, it sounds like Arculus is solving some extremely difficult and highly regulated problems. Many builders might think, "We don’t want to touch this problem; we’ll just hand it over to Arculus." In your view, what are the types of problems that lead these teams to choose to "give up doing it themselves"?

Adam:
That’s a very good question. The core reason can be summed up in one sentence: once you touch traditional payment tracks, things become extremely complex.

For example: if you want to put certain logic into a smart card, and that card is from Visa or Mastercard, then this is not just about "can it run technically." It must also be: approved, certified, and formally blessed by the payment network; you not only need it to work, but you also need Visa, Mastercard, and EMVCo to nod in approval.

This process is:

• Very time-consuming
• Extremely costly
• Highly specialized
• And very niche

You must know:

• What the standards are
• What the documentation is
• What the review process looks like

More importantly: you don’t just review it once.

Drew:
What do you mean? Is it for every transaction?

Adam:
Exactly. You first go through an overall certification to ensure your system meets the standards. Only then are you "allowed" to consider that every transaction occurring under this system is compliant. But to achieve this, you must design everything according to the standards from the outset. If you are doing a tokenized card or some objectified card logic, they operate under extremely strict protocols. From an engineering perspective, building and maintaining these systems is a very painful task. So for most teams, it is simply not worth it 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 our moat.

The second layer of our moat is: patents. CompoSecure holds hundreds of patents in this field, covering areas such as: metal cards, Web3 on card, Passkey on card—this is something we take very seriously. It’s not a field you can "just bypass."

The third layer of our moat is: scale. Compo produces millions of cards every year. We handle massive transactions. We serve a large number of Web3 clients. For many teams, their core focus should be on remittances, payment products, specific vertical businesses, rather than reinventing payment cards and security systems. This is precisely why we exist: to let them focus on their mission while we provide the infrastructure needed to accomplish that mission.

Drew:
In all these B2B use cases, is there any particular use case that excites you the most or resonates with you? Not naming clients, but from the perspective of "how Arculus is being used."

Adam:
That’s a good question. Because Arculus itself is highly modular, it can indeed be a bit difficult for outsiders to understand. Some people only need one of the three components; others may need everything from scratch.

As a builder, I really like this modularity. I often use Legos as a metaphor: I want to have all colors and shapes of blocks so I can build exactly what I want. But from a sales perspective, this is indeed harder to sell. Because you need: deeper conversations, and the customer really needs to understand what they need, rather than just "I have a pen; do you want to buy it?" This kind of simple sale.

Our often-mentioned "three-in-one" includes:

• Payment card
• Passkey
• Wallet

You can mix and match as needed. Need a Passkey server? We have that. Need backend connections to all mainstream blockchains? We have that.

If the client is very tech-oriented, we will engage in very in-depth technical discussions:

• What language to use
• How to optimize performance
• Which modules to use and which not to use

So ultimately, it’s about understanding your customer.

Adam:
I have a vision that I often discuss with Tom. I call it "Global Johnnie Walker." To be honest, it has nothing to do with how good the drink itself is; I just really like that logo.

Drew:
You mean the logo of the guy walking with a cane?

Adam:
Yes, that Johnnie Walker logo. I always have this image in my mind—a global traveler. This person is "empowered." It’s a highly permissionless state. What I’m saying now is completely my personal view, not the company’s stance.

In this world:

• I have my private keys
• 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. This is a permissionless value exchange. In a sense, it even feels like going back to the "cash era." Previously: cash in hand, goods in hand. Now: one hand is digital assets, and the other hand is instant settlement of value transfer.

If you can accomplish this with the lowest cost and the highest efficiency, then you have truly achieved competition. Cost is just cost, with no hidden fees and no layers of friction added by intermediaries. This is the world I hope we can reach.

And right now, we haven’t fully arrived. To achieve this goal, you must serve eight different "gauges" of railways simultaneously. The tracks that assets come in on vary, and the tracks they go out on also vary. You must be able to:

• Know what track it comes in on
• Know what track it goes out on
• Automatically route in between

This is extremely difficult. But this is precisely what we are working hard to achieve in the background. The ultimate ideal state is: trains can come in from any gauge and go out from any gauge, and for consumers and merchants, all of this is seamless. We haven’t fully achieved this yet, but this is the direction I strive for every day.

Drew:
I think you guys have already made significant strides in that direction. The name "Global Johnnie Walker" itself is very vivid. You also mentioned that you are already doing some very cutting-edge things, such as completing payments directly using stablecoin tracks at the POS.

Adam:
Yes. You and I have seen that demo. We can now achieve: direct on-chain payments using stablecoins with tap-to-pay. To take it a step further, you are not just "paying."

You can:

• First go through a DEX
• Or go through a centralized exchange
• Automatically convert to the most suitable asset
• Then complete the payment

Arculus itself:

• Has Paxos accounts
• Has Circle accounts

We can:

• Route stablecoins
• Mint
• Burn

Completing a lot of complex operations in the background.

Drew:
So the world you are describing is also the endgame that many stablecoin companies are pointing towards. Rain is pointing in that direction, and many builders are also pointing in that direction. From your perspective, how far are we from this reality?

Adam:
I think we are not that far. You’ve already heard: AMEX is talking about stablecoins, Brian Moynihan (BofA) is talking about stablecoins, and I really don’t think this will take another ten years. Just the other day, I was discussing this. The real key is: how quickly banks will become blockchain companies, or how quickly blockchain companies will become banks. At least in the U.S., we don’t have something like an "Electronic Money Institution (EMI)" license. If the U.S. had EMI, many things would be much easier. The GENIUS Act has indeed helped a lot, but if there were EMI, the entire system would be much simpler.

Drew:
Who do you think the GENIUS Act benefits more? Banks or blockchain companies?

Adam:
I think it overall benefits the blockchain side more. Companies like Circle and Tether may gain more benefits from it than traditional banks. The next major battleground will be: tokenized deposits vs stablecoins. This is not a technical issue but a regulatory issue.

To be honest, I personally hope that everyone lives directly in stablecoins. Every mint/burn is actually unnecessary friction. Some say, "Stablecoins are dead money." That’s not true. You can wrap it, earn yields, and then unwrap it to continue spending. I personally hold a lot of wrapped stables, generating yields every day.

Drew:
From what you just said, it seems you believe that the events of the past few months have brought us much closer to that "on-chain native payment world" than most people realize. But I’m curious about one thing: in your view, where is the real uphill battle? Because the gap between "willing to do" and "actually implementing" often lies in very specific, very messy execution details.

Adam:
You’ve asked a very pertinent question. The real difficulty is not blockchain, not stablecoins, and not smart contracts. The real difficulty lies in the traditional financial backend infrastructure. Let me tell you a very common and very real scenario. I’m at a whiteboard with a traditional financial institution drawing a flowchart. I say, "Okay, we can settle this step in real-time." The other party immediately says, "Wait, no. We cannot collect money that quickly."

Drew:
Cannot? That sounds a bit counterintuitive. Why can’t we receive money faster?

Adam:
The reason is not regulatory; it’s a purely mechanical issue. Their:

• Internal ledgers
• Internal clearing systems
• Core banking systems

Simply cannot handle real-time transactions.

Drew:
So it’s a problem with the "system brain" itself?

Adam:
Exactly. Many traditional financial institutions' backends are built on very old architectures. You can think of it as:

• The code was written decades ago
• The core logic is designed around T+N
• All assumptions are that "money won’t move this quickly"

So when you suddenly tell it, "The money is here now," the system doesn’t know how to handle it.

Adam:
This leads to a very ironic phenomenon: we can already:

• Transfer money instantly between people
• Transfer money faster between banks

But at a higher level, meaning:

• Regional banks
• The clearing institutions serving these banks
• And down to the central bank level

This chain still heavily relies on very old infrastructure. And upgrading these systems is very slow. Because the issue is not just technical, but: who will pay for the upgrades?

Drew:
This sounds like a classic "no one wants to be the first to move" problem.

Adam:
Absolutely correct. So in my view, this is the heaviest stone in the entire system.

Drew:
From a certain perspective, Arculus seems to be perfectly positioned between these two worlds: one side is the new world, and the other side is the old world.

Adam:
Yes, that’s also why I say: we serve Web2, Web2.5, and Web3 simultaneously. We cannot pretend the old world doesn’t exist. You must be able to communicate with it, be compatible with it, and gradually replace it.
Drew:
Let’s pull the lens back to a more specific point. In the past 6 months, stablecoin payment cards have become one of the fastest-growing use cases in the entire asset class. You are in a very core position in this field. How do you view this surge? What role has Rain played in it?

Adam:
I think Rain is very important in the entire ecosystem. Especially:

• Their understanding of payments
• Farooq’s background
• The smart contract structure they designed

All are very "payment-friendly."

Simply put, Rain’s model is like this: you put stablecoins into a smart contract. This contract settles monthly. If you repay on time, the assets stay there. If you don’t repay, the assets will be liquidated to pay off your debt.

From a user experience perspective, it almost completely resembles a traditional credit card: Visa/Mastercard tracks, merchants are completely unaware, settlement logic is familiar, but the underlying asset is actually stablecoins.

This solves a very real problem. In the Web3 world, there are many: DAOs, Web3 companies, crypto-native teams that hold a lot of digital assets, but daily life and operations still happen in the Web2 world. You still need to: buy food, book hotels, pay for SaaS, pay salaries.

Rain provides a way to truly connect Web3 assets to Visa. For a very specific example: I might have a bunch of BONK. I first convert BONK to USDC on Solana. I push the USDC into a smart contract. I swipe my card to buy pizza. At the end of the month: the system automatically settles, USDC is burned, the merchant receives fiat, and the process ends.

Adam:
And our role here is to make all of this "really happen in the real world." The card is with us. The signatures are with us. The wallet is also on the card.

When you sign that smart contract, the private key used for the signature resides on the card. So: on one side, we are communicating with Visa; on the other side, we are signing Solana/Ethereum contracts. These two tracks are completed within the same physical secure object. This is also why I say: Arculus and Rain are highly complementary. They have done smart contracts on many chains, and we have also done so on some chains they haven’t covered yet. This is a very natural collaborative relationship.

Drew:
I want to use a very specific business example to "ground" what we just discussed. Our company is now using Dakota for corporate banking and stablecoin treasury. Through Rain, we now have an embedded card that can be used like a credit card, connected to Dakota’s stablecoin account. I haven’t received a physical card, nor did I specifically apply for one; it’s now completely in digital form. If I didn’t know about Rain, I might think, "This is just a card issued by Dakota itself." So from your perspective: in this absence of a physical card, is Arculus still in that chain?

Adam:
The answer to that question is: it depends on the specific platform's implementation. In the very specific scenario you described, we are not in that chain.

But if this issuer:

• Uses Passkey
• And has used our Passkey product

Then we might appear at the identity authentication layer. For example: we can use Passkey to protect your login process to the Dakota platform.

Let’s take another example. If you are using a Passkey-native wallet, like Coinbase’s wallet (which they now call Base App), then Arculus can fully participate in that.

Drew (laughs):
I really can’t keep up with their renaming.

Adam (laughs):
Neither can I. But the point is: Base App is fully Passkey compatible, and Arculus can work in conjunction with it. This actually goes back to the question you asked earlier: modularity.

Most of the time, we are behind the scenes. But "which block is used behind the scenes" completely depends on: who the platform is and what the use case is.

Drew:
And what about you? You personally are also using the card issued by Rain, right?

Adam:
Yes. I personally use the Arculus corporate card issued by Rain.

Drew:
Is this card connected to Arculus’s corporate account? Or some kind of corporate expense account?

Adam:
Essentially, it connects to stablecoins. For example: finance gives me a budget of $500. What I receive is: $500 in USDC. I push this 500 USDC into a smart contract. After that: I travel, I buy coffee at meetings, I buy tacos, and each expense: generates a receipt and is managed in Rain’s system. At the end of the month:

• The portion of USDC I spent
• Will be burned
• Will be settled
• Will be paid to the merchant through the banking system

For the merchant: this is just an ordinary Visa transaction. They have no idea that the underlying asset is stablecoins.

Drew:
That’s really cool. Platforms like Ramp and Brex for corporate spending are developing very quickly. Do you have partnerships with these platforms?

Adam:
Yes, they are all our clients.

Drew:
At least Ramp has publicly stated that they want to introduce stablecoin tracks into corporate expense management. Do you think this is a wave that is forming?

Adam:
I can’t comment on specific companies’ roadmaps because that’s their own business. But I can say that: in these types of platforms, our Passkey product fits very well. Many of these platforms will choose professional custodians at the digital asset or stablecoin level.

In this model:

• Passkey can be embedded in their internal systems
• To protect employees
• Or protect customer accounts

For example: employee identity, employee login, access to internal corporate systems—Passkey is a far superior solution compared to passwords.

Drew:
And in this employee use case, it doesn’t necessarily need to have payment functionality, right?

Adam:
Absolutely correct. The integration of employee ID, access control, payments, and logins. We have done some proof of concepts. You can imagine: an employee ID card.

It can:

• Swipe to enter the office building
• Also be a Visa/Mastercard
• Also be a Passkey

You can:

• Use it to buy lunch
• Tap it on your computer
• Log into the system via Windows Hello

All of this can be done on the same card. Instead of the current situation where there are:

• Six systems
• Six sets of credentials
• Six isolated security domains

Drew:
This is the charm of modularity, but it also means that your go-to-market strategy is actually quite challenging.

Adam:
Yes. There are indeed many companies in the market that only focus on one of those points. And many of them are also very traditional and legacy. We often encounter situations where I walk into a large institution or casino and say, "Look, these systems can all be connected." Then I see: six people in charge, each managing six systems, and each one is very difficult to move. This is not a question of whether the technology can work, but rather: transforming old systems is slow, messy, and difficult.

Drew:
We are almost at the end. Before we wrap up, I want to return to a bigger question. From your position—you are deeply involved in both the stablecoin world and the traditional payment and issuing systems. How do you view the stablecoin payment card track itself? Especially in emerging markets or some non-dollar countries, what do you think will happen next?

Adam:
I think we will see a very huge growth, primarily occurring in non-dollar markets. The reason is actually very simple: they crave access to dollars. I have been saying this for many years, and I will continue to hold this view: the most important export commodity of the United States is far from the goods themselves, but rather the dollar.

In the past period, I believe the U.S. has not done well in this regard. The "Gensler era" has harmed the global accessibility of the dollar. We should have been actively promoting the use of dollars globally through stablecoins, expanding the influence of the dollar. But during that time, we chose to: tighten, close, and hesitate. Now the situation is changing. We are starting to encourage access to dollars through stablecoins again. This is very good for the U.S.

What does this mean? It means:

• More people globally using dollars
• Increased demand for U.S. Treasury bonds
• A more solid foundation for the U.S. financial system

So I believe that:

• Emerging markets
• Remittance scenarios
• Consumption based on stablecoins

Will continue to explode.

Another advantage of stablecoins, which is often overlooked domestically in the U.S. 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 is forced to exist as collateral. As an issuer or payer, to cover: weekends, holidays, and clearing delays, you must prepare in advance: millions of dollars, even tens of millions of dollars. This money just sits there, generating no efficiency, creating no value; it’s completely "dead money." But if you can achieve: real-time settlement and a good funds model, then the money is truly there. You can release a large amount of locked capital. This is an extremely significant efficiency improvement.

Drew:
Adam, this conversation has been truly fascinating. One last question: if someone is listening to the show today, they might already be in the stablecoin industry or preparing to enter this industry, what would you say to them? Or to put it another way: who is suitable to seek out Arculus? Who might not be suitable?

Adam:
I think Arculus is for those who want to seriously engage in "grown-up crypto." I’m not talking about: memes, 8-bit cats, or some interesting but highly niche things—those things certainly have their value, but that’s not our focus.

What we want to do is:

• Change payments
• Expand the accessibility of the dollar
• Enhance global financial efficiency

What I want to say to the stablecoin and digital asset industry is: if you truly stand at the intersection of Web2 and Web3, and you want to focus on payments and financial infrastructure, you will find that serving different "gauges" of railways is an extremely challenging task. I can honestly say: I have "spent several years of my life" to enable Arculus to serve Web2, Web2.5, and Web3 simultaneously.

So my invitation is: if you are doing this or preparing to do this, we have built a very strong platform. If there are parts we can’t handle, I can almost guarantee: we have very good friends who can fill in. Let’s form an alliance to truly get things done and genuinely change the world. This is also why I walk into the office every day.

Drew:
That’s fantastic. Adam, thank you very much for your time today. This has truly been a highly valuable conversation. I completely agree with your concept of "grown-up crypto." I think more and more people are indeed moving from the "play phase" to the real construction phase. It has also been a pleasure to collaborate with you and Tom in recent months. Thank you once again.

Adam:
Thank you. This chat has been very enjoyable.