The Agentic Economy: How AI Agents Will Transform the Financial System with Circle Co-Founder and CEO Jeremy Allaire

**Elad Gil** (0:05)
To Dan No Priors, we have Jeremy Allaire, the co-founder and CEO of Circle. We'll be talking about cryptocurrency, AI, agentic payments, AI evolving on the blockchain and a variety of other topics. Well, thank you so much for joining us today. It's a pleasure to have you.

**Jeremy Allaire** (0:19)
It's great to be here. Thank you.

**Elad Gil** (0:21)
So maybe we can start with you just giving a quick overview of Circle, what you do, how you purchase the world, because I think we're going to be talking a lot about stablecoins, crypto, AI, and how all these things tie into the agentic future. But I'd love to just start with origins of the company, what you all are up to, and we can go from there.

**Jeremy Allaire** (0:36)
Yeah, for sure. So Circle has been around for a while. I co-founded the company over 13 years ago or so, 2013
Really, at inception, I was really excited about this idea that we could create a protocol for dollars on the Internet. I had been really excited about what was happening with technologies like Bitcoin, and had been working on the kind of Internet infrastructure for a long time, and got really excited like if we had like a protocol for dollars on the Internet, that potentially we could have a way to store and move value instantly, globally, frictionlessly at no cost, ultimately. The other idea that we were really excited about back then was this idea of programmable money, and the idea that eventually these networks, blockchains, would become like operating systems, and you could actually have machines that intermediate economic activity and financial activity on the Internet, including like autonomous software machines. And back then, we didn't have generative AI or anything like that, but this sort of idea of kind of commoditizing the kind of payment utility layer with like very safe digital, dollar digital currencies, and then having like programmability of that with machines that are kind of tamper-resistant, can run on the Internet. That's what kind of drove the founding of the company. And the view is like, if we could do that, like we could actually improve the financial system, make it safer, make it more accessible, make it more efficient, and kind of derive new utility for money that we haven't had before. And so that was sort of where we started.

**Elad Gil** (2:11)
The dollar aspect of that is important. So if you look at a lot of the things that happened in cryptocurrency in the early days, it was really about creating things that were divorced from the traditional financial system if possible or were not dollar centric. So for example, Bitcoin was in part a response to the great financial crisis. And the view that all sorts of weird bailouts happened there and therefore we needed some alternative sort of financial infrastructure for the world. Yeah.

**Jeremy Allaire** (2:31)
So I think, so I actually, what's very interesting is like, I believe in kind of Austrian economic thought. I was studying Austrian economic thought like in the early 1990s for a very long time. And so I've been interested in sound money theory. And actually it was studying the kind of impact of the global financial crisis that drew me into this because my view is like, there has to be a way to build like a safer financial system. And the key issue there was I was interested in this idea of full reserve money. And in some ways Bitcoin is full reserve money because you kind of, there is no way to fractionally lend Bitcoin per se.

**Elad Gil** (3:12)
So full reserve money means currency that's backed by something hard behind it, some asset.

**Jeremy Allaire** (3:17)
Doesn't necessarily mean it's a hard back. Full reserve money is different than, say, fractional, full reserve banking, I should say, is different than fractional reserve banking. And so, you know, back in, there was another major economic collapse, which was the Great Depression, the run on all the banks and all that fun. And in the 1930s, there was a really big debate about, like, what's the right construct for the banking system and the financial system. And there was a proposal from a group of economists called the Chicago Plan. And the kind of ringleader was a Chicago economist, actually it might have been a Yale economist or Princeton at the time, but Irving Fisher, who wrote a book called 100% Money. And that idea was that full reserve money was essentially, you know, government obligation money. So it's still the obligation of the government, like the US government in that instance. But that essentially, you can have that and you can hold that, but you can't take that and then fractionally lend against it. So you have kind of a full reserve, but you can only lend full reserve money. And so that was a big proposal for how to structure the way the financial system worked. And it was actually lobbied very, very hard against it by the banks. And the banks really liked fractional reserve. They liked to be able to have the inherent kind of leverage and risk taking, and instead convince the government to establish, or they collectively, with the government's sanction, established an insurance company called the Federal Depository Insurance Company Corporation. And so that was a kind of corporate insurance model, but the risk taking still existed. And so we've continued to kind of face those issues. The great financial crisis was an example of 30x leverage, 12x leverage, 14x leverage against these sort of base layer. And so my philosophy has been, well, right now, in terms of general utility, our existing economic system, like it does depend on really major reserve currencies like the dollar. And my view is like that's going to continue for a while, maybe 30, 40, 50 years. It will continue for a while. But what we want to do is construct a system that is in fact safer. So a full reserve form of money. And that's what stable coins are. That's what dollar stable coins are. And in fact, with the Genius Act that passed last year, it's sort of codified in law. You can't do anything with this. It's like this very narrowly bound, narrow money kind of model. And so I think in some ways like that original vision, we've now got established in laws around the world. And now we have to do more with it. We have to make it extraordinarily useful.