Stablecoin Issuance Regulation with Nestor Dubnevych from Legal Nodes

[00:00:00] Nestor: When it comes to stablecoins, one activity includes the issuance of it.

[00:00:05] Nestor: Another activity includes the distribution, and that's two different types of licenses, two different scopes of compliance requirements as well.

[00:00:13] Nestor: And when it comes to audits to even engage reputable auditors, sometimes their engagement letters starts from hundreds of thousands of dollars.

[00:00:24] Nestor: So it's not a startup friendly cost.

[00:00:27] Nestor: Therefore, the cost of compliance would probably quite a high market barrier for the newcomers or for the startups who will be interested in launching their own stablecoins in the US.

[00:00:40] Umar: Welcome to The Accountant Quits podcast, where we help accounting and finance professionals learn how to manage a business using crypto.

[00:00:48] Umar: On July 18th, 2025, President Donald Trump signed into law the GENIUS Act marking the first comprehensive federal legislation for payment stablecoins.

[00:00:59] Umar: Now, even those stablecoins are borderless, they're locked within particular laws of specific countries.

[00:01:05] Umar: This lack of regulatory interoperability creates both hurdles and openings for projects operating in multiple jurisdictions.

[00:01:14] Umar: To help us navigate regulation for stablecoin issuance today, I'm thrilled to have Nestor Dubnevych, the Co-Founder and Head of Web3 at Legal Nodes.

[00:01:25] Umar: From company formation, licensing, compliance, and legal structuring, Legal Nodes is your one-stop shop to ensure you can operate your web3 project with peace of mind.

[00:01:36] Umar: In this episode we'll cover, what the GENIUS Act really means for stablecoin issuers, new business opportunities for off ramping and on ramping players, how stablecoin regulation compares across the US, UK, EU, the Middle East, and Asia Pacific, compliance checklist for crypto payment gateways, and much more.

[00:01:58] Umar: Lastly, if you're new to this channel, I'd really appreciate your support to help us grow by liking this video and subscribing.

[00:02:04] Umar: Now, enjoy my conversation with Nestor.

[00:02:08] Umar: Nestor welcome and thanks for making the time to be here.

[00:02:12] Nestor: Thank you very much Umar.

[00:02:14] Umar: So to start, I want to dive straight into the GENIUS Act and what this really means for stablecoins. Like I said in the intro, a few weeks ago, the U.S Senate passed this act, which establishes a regulatory framework for stablecoin issuers and payment stablecoins.

[00:02:31] Umar: Now could you walk us through on what this means for stablecoin issuers in the US, who actually gets to issue and redeems stablecoins and maybe the relevant reserve requirements?

[00:02:44] Nestor: Absolutely. So first of all, I completely agree with what you say that during the introductory part that this piece of legislation is definitely a huge signal for the industry.

[00:02:58] Nestor: And many players started recognizing crypto and stablecoins as something real and some something that can be used for the broader market, not just for the very particular groups.

[00:03:13] Nestor: Now, if we speak about the GENIUS Act, to be honest, I'm a bit skeptical regarding this act because for me personally, it looks like the act for the existing market players rather than for the newcomers or for the startups, or for some innovators or builders.

[00:03:34] Nestor: And the reason of it is that this act allows the companies to issue the stablecoins only if they are banks or certified entities or non-banking institutions with the federal authorizations and the for the company to obtain banking license or to obtain the certification that is required for being or for operating as the issuer of the stablecoin takes a lot of effort, takes a lot of time, resources, money, and to build this infrastructure, it's like one task to do, but to maintain it, it's just another level of effort and time and resources, etc.

[00:04:18] Nestor: So from one side it is definitely a great signal for the market, from the other side. It's still for the very, like limited group of companies are a number of market players who will be able to afford this level of compliance and this level of requirements for issuing the stablecoins.

[00:04:39] Umar: Okay, interesting. We'll go through the price of compliance in a bit. But I want to ask you, and also we'll be comparing the GENIUS Act with MiCA in Europe later during the episode, I wanna ask you what it means for the current stablecoin issuers operating in the US because for example, if we look at Tether, they were delisted from major crypto exchange platforms in Europe as they were deemed to be non-compliant with MiCA.

[00:05:06] Umar: Now, who are the winners and losers from this GENIUS Act?

[00:05:10] Nestor: I think that Circle and Tether will definitely be one of the key market leaders. That's my assumption. These brands are really strong among the crypto community, however considering that banks are allowed now to issue the stablecoins, the raw players, which with much more broader networks, communities, user bases.

[00:05:35] Nestor: And that's where adoption would probably come from. So for, even for this strong big companies like Tether and Circle there might be some sort of the risk that the bigger players will enter the market soon and the stablecoins issued by, let's say Bank of America or by some other big players might grab broader attention and that what will help them to win the bigger market.

[00:06:03] Nestor: However, if you take a look onto the electronic money, 20 years ago, PayPal was founded and during first five to seven years of this company, electronic money existed in a gray zone and many big financial institutions were very skeptical to it. But then once the specific legislation was passed by the regulators across the world, PayPal still kept its position as the key market leader of electronic money.

[00:06:36] Nestor: So we'll see how it'll go with Tether and Circle. They have a great infrastructure in terms of compliance, in terms of partners like custodians, reserves, etc. I think that the, their chances are very high, but let's not forget that there are much bigger players on the market that will now be able to issue stablecoins as well.

[00:07:00] Umar: Now I wanna go through the price of compliance with the GENIUS Act. So the Act mandates strict compliance requirements. For example, a 100% reserve backing, monthly attestations, quite a big one, and annual audits once stablecoin supply exceeds $50 billion. Now, clearly these rules, they add significant operational and capital overhead making compliance easier for perhaps the larger players like Circle, USDT, who can easily absorb these costs.

[00:07:29] Umar: Now, from your perspective, just how challenging is compliance under the GENIUS Act? And could these more stringent rules stifle innovation in a way by creating barriers, too high for the smaller players. I mean, you've gone a bit through it earlier.

[00:07:46] Nestor: The regulatory burden is really high, but it's understandable. We saw all the cases with Terra Luna and with some other projects that didn't manage to keep everything in compliance when it comes to the separation of users, funds and the company's funds. Some AML issues of some other projects, etc.

[00:08:08] Nestor: So these standards should be high. And just to protect the market and investors. But if we compare the approach to compliance in Europe, for example, that is mostly focused on investors and consumers, in the US feels like it protects the big financial corporations better and when it comes to the cost of compliance that's also something that big financial institutions like to use as the protection from the potential competitors, especially when it comes to some very innovative solutions that can grow very fast. However, where this compliance requirements can be the market barrier for them and for their growth as well.

[00:08:56] Nestor: Therefore, when it comes to this compliance requirements, so first it's important to focus on the activities that should be in compliance with the regulations.

[00:09:07] Nestor: When it comes to stablecoins, one activity includes the issuance of it. Another activity includes the distribution, and that's two different types of activities, two different types of licenses, two different scopes of compliance requirements as well.

[00:09:23] Nestor: So when it comes to the first one, audits and AML measures is something that should be properly implemented and when it comes to audits, to even engage reputable auditors, sometimes their engagement letters starts from hundreds of thousands of dollars. So it's not a startup friendly cost.

[00:09:45] Nestor: But the big financial institutions, they already have their auditors. So I think that it should be relatively easy for them to just add more work for their existing auditors.

[00:09:57] Nestor: And also when it comes to custodians who can provide the custody for their reserves, there's another like market segment that is not cheap and to be able to onboard with such custodian, which can be the bank or other institution that provides this depository services.

[00:10:15] Nestor: And there is also a lot of things to do to become acceptable for these regulated institutions. Therefore the cost of compliance would probably be, at least at the beginning, it would be a big, quite a high market barrier for the newcomers or for the startups who will be interested in launching their own stablecoins in the US.

[00:10:37] Umar: But in general even though yes, the price of compliance is steep are you happy with the GENIUS Act?

[00:10:44] Nestor: For me personally, I think that it's a great market signal that what we discussed before and when it comes to the big financial institutions, there will probably be more products for the market and for the consumers.

[00:10:58] Nestor: It's that it would definitely have a positive effect. But from the entrepreneurial point of view, I think that without the particular sandbox or some simplified type of license it would still remain the opportunity for the bigger players.

[00:11:15] Umar: Yeah, I agree. Now, I also just want to give a quick shout out to LedgerLens we had them on Episode 72 and they do provide attestation tools for stablecoin issuers.

[00:11:29] Umar: So, if you wanna check them out, you can listen to the episode I did with Jeremy Nau, their Founder on episode 72. Now, I wanna move on to speaking more about the general outlook for stablecoin issuers. So this act is due to become fully operative 18 months after the President has signed it.

[00:11:49] Umar: So. If my math is correct, this is gonna be early Jan 2027 or late December, 2026. Now the GENIUS Act, it opens the door for obviously more issuers to launch their own stablecoins. I was reading recently that the Wall Street Journal reported that companies like Amazon and Walmart are exploring launching their own stablecoins as well.

[00:12:13] Umar: Now, with this regulatory in place that has been long awaited, how do you see the future shaping up for stablecoin issuers? And do you think traditional banks will adapt quickly enough to compete?

[00:12:27] Nestor: That's a really great question. When some first stablecoins was introduced probably five or even seven years ago there were a lot of talks that transactions should become cheaper because the stablecoin transactions don't require any intermediaries, but it ended up in the more expensive transactions comparing to just like banking transactions or the transactions with some electronic money institutions.

[00:12:56] Nestor: The reason was that the ecosystem and infrastructure was in the very early stage, back to that time, and the compliance requirements plus regulatory uncertainty were too high back to that time.

[00:13:09] Nestor: It might happen one more time now as well, especially when it comes to this early stage of the legislation, when the regulators will work on it to make it operational while the companies will work on it to figure out how to apply this legislation to their own processes.

[00:13:27] Nestor: And this first, like two to three years are usually the time that wouldn't provide any sufficient benefits or competitive advantages, but after that, there will probably be a huge shift and that's my assumption is that's one of the reasons why big players started interesting in this type of payment.

[00:13:46] Nestor: Because if you take a look into the traditional financial infrastructure that includes a lot of layers, a lot of intermediaries, a lot of commissions, stablecoins might help to reduce this number of intermediaries and as a result to make this transactions cheaper and faster.

[00:14:03] Umar: Now, when I was preparing this episode, I came across this term called stablecoin sandwich. I was not familiar with this term, but basically it's the process that leverages blockchain and uses stablecoins as a middle layer for fiat-to-fiat cross-border transactions. So just for example, I'm based in Portugal. Let's say I had to send money to Argentina.

[00:14:24] Umar: If I wanted to save on some banking fees, what I could do is I could convert my Euro to USDC. I send USDC to that beneficiary in Argentina, and that recipient, they would just then convert USDC to Argentinian Pesos. So by using stablecoins in this way to transfer funds internationally we've eliminated as you know, the listeners, the inefficiencies of traditional banking systems with the delays and the high costs.

[00:14:51] Umar: Now, this week I was speaking with someone, he works at an on-ramping off ramping solution, and he was mentioning that they're currently discussing with freelancing marketplaces or neo banks who are looking to also offer stablecoin payments. So given this trend, how do you see the landscape evolving for on ramping and off ramping partners?

[00:15:14] Umar: Do you expect an explosion of such providers building on stablecoins?

[00:15:20] Nestor: From my point of view, it's already happening. Many freelancers, digital nomads, gig workers, they already use stablecoins for international transactions and payments because it's very fast and cheap and convenient.

[00:15:35] Nestor: When it comes to these big platforms, I think that from one side, once the legislation gets to the stage where it's fully operational it'll definitely provide them with the opportunities to, add these types of payments. But I really liked how you mentioned that the beginning, this regulatory interoperability or regulation interoperability for the global financial system, and they, for example after USDT gets licensed in the US under this GENIUS Act while being noncompliant in Europe. I'm afraid that all these big freelance platforms wouldn't be able to support the payment by, let's say, a US based client to EU based contractor. So yeah this regulatory environment will still remain a very important consideration for this big international platforms that provide the solutions for the freelancers and gig workers.

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[00:18:12] Umar: So I want to go through another topic and staying on the GENIUS Act, which is on yield bearing stablecoins because the GENIUS Act, it bans payment stablecoin issuers from paying interest or yield. I've had a guest previously on this podcast where we spoke about yield bearing stablecoins, but I want to take, let's say, an example of a stablecoin issued by Paxos, which is USDL, that's regulated through the Abu Dhabi Global Market (ADGM) regime, but it's fully backed by US treasuries and cash equivalents and unlike other traditional stablecoins like USDC or USDT, USDL is inherently yield bearing. Just by holding it, you would be earning the US treasury returns, which would get distributed to you.

[00:19:03] Umar: Now, yield bearing stablecoins like these, even if issued in the US, would not be permitted under the GENIUS Act, right? But I think still good news for DeFi, and now you'll have, I mean, an influx of like stablecoins, which can be transferred to DeFi protocols. How do you see the GENIUS Act in terms of for projects driving innovation for those yield bearing stablecoins?

[00:19:30] Nestor: That's a great question, and I think it's very much related to some background of the GENIUS Act. A couple of years ago there was a huge trend of CBDC or Central Bank Digital Currencies and many countries started working on some pilot projects. As far as I know at the moment, there are no successful projects within this like market category, but for the US it looked like some sort of the , threat for their national currency.

[00:20:00] Nestor: And the GENIUS Act is some sort of the way for them to protect their national currency. And that's what applies the mindset a bit different mindset to the stablecoins issued under the GENIUS Act, which are considered by the regulators as the payment method, not the investment instrument and that's why they probably have a different piece of legislation, A Clarity Act, hope it'll happen later this year.

[00:20:29] Nestor: But for the GENIUS Act, there is a very narrow focus on making or adding this new type of payment method. While in other countries stablecoins have more flexibility that they can be used as the payment method like e-money tokens in Singapore or same e-money tokens in the in Europe under MiCA and they also can be some sort of the combination of payment and investment instrument which can provide them the yield or which can have yielding mechanisms.

[00:21:01] Nestor: And I also think that it's the matter of the protection of investors' rights because for the stablecoins that don't have these features or where these features are prohibited, it's easier to control the market.

[00:21:14] Nestor: And it's might look safer for both the regulators and users of this new financial instrument. So maybe it's also some sort of more careful approach of the US regulator to this new type of financial instrument comparing to the other countries.

[00:21:32] Umar: Now you wrote a great article, Nestor, on where you compared stablecoin regulation across different jurisdictions.

[00:21:41] Umar: So I wanna ask you, how does this US GENIUS Act stack up against the other global frameworks that we already have in place, such as in Europe we have MiCA. When it comes to the reserve requirements probably one of the reasons why also USDT was delisted or banned from operating under MiCA also in terms of issuer authorization and the overall regulatory approach, is there one that stands out right now ?

[00:22:08] Umar: Is the US GENIUS Act let's say more appealing for stablecoins issuers to flock to the US.

[00:22:17] Nestor: So from my point of view, US would probably remain the place for the big market players when it comes to stablecoin issuers and therefore if there are already, if there are some institutions that are already big they would probably be able to afford the US legislation from the perspective of compliance and some other requirements to be able to issue the tokens, their stablecoins.

[00:22:42] Nestor: However, when it comes to more startup friendly regulatory frameworks, recently El Salvador and Hong Kong introduced their pieces of legislation and the requirements are more democratic I would say.

[00:22:57] Nestor: There is no, the strict requirement that only banks and some other certified institutions can issue the stablecoins.

[00:23:03] Nestor: Any company or any team can establish the company, get this to the level of this compliance requirements, deploy the required authorized capital or the reserve and it varies from country to country, starting from three millions in Hong Kong and then varying to like the lower number of reserves, like a couple of hundreds of thousands of Euro in Europe, for example, or even a couple of thousand, dozens of thousands of dollars in El Salvador, for example.

[00:23:34] Nestor: So there are different levels of complexity of this frameworks and let's not forget that issuing is one type of activity and the distribution is the other. So let's say if the stablecoin is issued under this El Salvador license, and if the distributor that is licensed under Singapore legislation or Hong Kong legislation is comfortable with the stablecoin issued by foreign issuers, it might provide a stablecoin with the global exposure.

[00:24:04] Nestor: So yeah, this regulatory interoperability is a huge topic for crypto and when it comes to the country that is the most friendly for the stablecoins, from my perspective at the moment, there is still no market leader because there are always pros and cons for each of the jurisdiction.

[00:24:23] Nestor: But the US, has a huge chances to become a market leader just because it's the biggest market in the world and it has a huge number of potential users of this new type of financial instrument.

[00:24:36] Umar: All right. So next I'd like to speak about crypto payment processes under US law. So if you accept crypto from a customer and transmit fiat to a merchant or vice versa, the FinCEN in the US treats you as a money transmitter, so you have to have it's called an MSB license. So with the GENIUS Act, only these permitted stablecoin issuers can issue payment stable points in the US right?

[00:25:04] Umar: So that means a payment processor in the very near future, they'll not be able to offer or sell non permitted payment stablecoins in the US. So I wanna ask you, Nestor, if you are building like a compliance checklist for a crypto payment gateway today, what items would you include to cover both on the existing MSB requirements and the GENIUS Act?

[00:25:30] Nestor: First of all, when it comes to the new type of asset that the company implants to add into the basket of the tokens or the stablecoins that can be processed or accepted by the merchants it's important to ask for the licensing documentation of this new type of asset.

[00:25:49] Nestor: That's one of the reason why all crypto exchanges that are licensed, like all centralized crypto exchanges, they always ask about token legal opinion before being able to list the token on exchange.

[00:26:01] Nestor: Same will happen for the payment processor, crypto payment processors or crypto payment gateways and so this legal opinion is the first ask or first question for the checklist. Then once these details are clarified, the second question is related to the anti-money laundering requirements. So, currently there are some tokens that are privacy tokens, I would say, or the tokens that can't be traced in terms of the chain of transactions or the verification of the wallets and I think that the underlying technology of the stablecoin should provide this traceability and accountability also because if anything happens with the stablecoins that were processed by this payment processor, on the technical level or from the perspective of the AML, then it might result in some risks for this payment processor as well.

[00:26:58] Nestor: And of course, the information about the reserves and the audits of these reserves is something very important as well. We saw these cases before. I mentioned that Terra Luna before, but there were some other cases. We used this fully decentralized, permissionless stablecoins that there was a huge, it was a huge topic in 2021 and many companies tried to launch their own native decentralized stablecoin with this fully autonomous price stabilization mechanism. But it ended up really bad for some projects. So I think that's the third question for the checklist, what are the reserves and how well established is the process of auditing it.

[00:27:42] Umar: From your experience in the industry, are there some other stablecoin projects that maybe stand out for other use cases, like maybe there will be stablecoins more fit for certain use cases, and some more for like, or other markets will be using them? Like USDT is used a lot in, for example, Asia, Africa, South America.

[00:28:09] Nestor: That's a great question. To be honest, in terms of the geography, I think that some stablecoins will remain more popular in some countries while the other will be less popular and we saw the stablecoins that became very popular in the Middle East, for example, while in Europe, USDC is the stablecoin to go and some stablecoins backed with Euro.

[00:28:32] Nestor: Some local options are also very popular.

[00:28:35] Nestor: While in the US, USDC and USDT would probably be the most popular options to use and it also depends on the underlying protocol. Like the USDT on Tron network is probably one of the most popular in Asia while in Europe and in the US the ERC-20 based, USDT are might be more popular as well. So yeah, in terms of the geography, there will be different, different regions for different stablecoins. But from the perspective of the use cases, that's really interesting question and I think that it'll depend on the distribution strategy of this big player.

[00:29:15] Nestor: So for example, once the PayPal launches their own stablecoin, they will probably be able to offer the stablecoin to all their e-commerce merchants. So maybe PayPal stablecoin will become the most popular use case for the e-commerce while for Stripe that is also in working on its own stablecoin, different SaaS tools and some other tech subscription tools might be the go to market strategy and that's where their stablecoin might get the most popular and for the big enterprises or for some B2B transactions, maybe there will be one another like very different type of stablecoin. The most popular one. So we'll see that's in the very interesting stage of the market at the moment.

[00:30:01] Umar: I agree. I can easily see it going into that direction with the one that you gave on Stripe and PayPal is yeah excellent examples. Now, Nestor, this episode is mainly focused on stablecoin regulation, but we are lucky to have you today and I also wanted to ask you a question around regulation for RWA.

[00:30:23] Umar: So as a quick refresher for the listeners, so real-world asset tokenization, it relates to when you convert a legal ownership of in physical or financial assets as such as real estate, commodities, art or bonds into blockchain based tokens, then, which you can then enable fractional ownership.

[00:30:43] Umar: You have 24/7 settlement and so on, you can access basically a broader investor base, right? So in the US tokenized real-world assets are generally treated as securities. I want to ask you about how any of these real world tokenization platforms should approach regulation. How should they prioritize different jurisdictions?

[00:31:10] Umar: And yeah, how should they deal with overall, like compliance right now?

[00:31:16] Nestor: That's a very high growing market from my point of view. Like five years ago, it was a very ambitious idea to tokenize something. Today, it looks like a very real use case, but there is a huge lack of regulatory clarity still.

[00:31:33] Nestor: And there were a couple of reasons for it. Reason number one, it includes this variety of real-world assets. It's not as simple as in case of stablecoins where you can have a highly liquid assets as a fiat currency or some government estate obligations or state debt instruments.

[00:31:53] Nestor: In case of RWA, there might be like secure matters of the land, real estate, precious metals like gold or silver, different types of commodities. Then it might be different tokenized stocks and some other financial instruments. And even piece of the art can be tokenized, which is also the example of real world asset or some collectibles like collectible cars or some other types of assets.

[00:32:21] Nestor: And that's the big challenge because each of this asset has its own legal status and until recently, the most common way to tokenize something was to first make it the ownership of the legal entity and then to use this legal entity as the, some sort of tokenziation vehicle or tokenization SPV, where the shares or the membership interest of this entity can be tokenized or where the entity can issue the debt bonds or debt notes and tokenize it so that token holders can gather this potential interest from the company.

[00:32:58] Nestor: However, currently a couple of regulators are actively working on the RWA regulatory framework there will be some updates in Europe next year and in the EU they recently introduced this clarity and what should be treated as the security and what's not the security, especially when it comes to the tokens backed by commodities.

[00:33:19] Nestor: And that's something that US wants to solve with their Clarity Act which the market expects as the Act that will provide them clarity on which assets should be regulated by their commodities commission and shouldn't be like qualified as the securities while what are the assets that will be will be controlled by the Security Exchange Commission.

[00:33:44] Nestor: And I think that once this division of the assets between those two categories is finalized, that's what will unlock what will help to unlock the next stage of the market development.

[00:33:57] Umar: So right now, because you're saying there's a lot of gray area when it comes to like tokenization of RWA, I mean these projects, they cannot do much, right?

[00:34:06] Umar: In terms of, I mean, they want to obviously in the future avoid like bad surprises with a new regulation that comes up and they've not been prepared. But because there's a lot of gray areas you cannot do much.

[00:34:20] Nestor: Yes and this regulatory uncertainty was always a big growth barrier for the whole crypto industry. Starting from the early days of the crypto exchanges that were always in this regulatory scrutiny, what they can do, what they can't do. These fines and regulatory investigations was always the part of their journey then there was this ICO boom and there were a lot of regulation uncertainty around tokens.

[00:34:48] Nestor: Then stablecoins, now RWA. So just the market cycles and every new every innovation requires this gray area stage before it can get some regulatory clarity from the governments.

[00:35:04] Umar: I agree. Now, in light of what we've discussed around stablecoin issuance regulation, could you provide an overview of the services that you provide at Legal Nodes, but also please feel free to share everything else that you provide, I mentioned in the intro that you guys are like a one-stop solution.

[00:35:23] Nestor: Absolutely. So our mission in Legal Nodes is to help crypto projects to enter the market by reducing this high market barriers resulting in a lot of regulatory and compliance requirements, without any harm for the compliance quality.

[00:35:41] Nestor: And we do this by offering the virtual workforce for the crypto teams. So when they are on the early stage, they usually need some guidance for the incorporation process for the best country to incorporate, etc. That's where we have incorporation experts who can be engaged in Legal Nodes platform.

[00:36:04] Nestor: For more mature companies who, which usually experience some repeatable tasks like compliance checks, like document review, like some other corporate and compliance tasks, we have compliance officers and legal officers as well who can be hired through Legal Nodes platform.

[00:36:21] Nestor: And our goal is to help them to simplify this compliance burden without lacking the sufficient level of compliance for their processes so they can grow faster and that they can make their innovations real. And basically make the services better for the end customers because that's the ultimate goal of this of this industry and for all innovations.

[00:36:47] Umar: I also want to give you guys a shout out for your excellent blog. I think I told you this before when we were speaking Nestor, but a lot of times when I was preparing episodes, I was reading like the excellent articles that you guys have, so you guys are doing really good, great work in terms of like content.

[00:37:07] Nestor: Thank you very much. We always wanted to open source all the insights that we have or that we've collected so the broader market can use it and simplify their legal journey. So really appreciate this feedback and hope listeners will be able to benefit from it as well.

[00:37:26] Umar: Yeah, I would even say you guys are the industry standard when it comes to everything related to company formation, DAOs, like everything related to, yeah, crypto licensing. It's very useful. So yeah, the listeners, you have to check it out.

[00:37:41] Umar: Now Nestor, I also want to ask you, so looking back to when you guys first started in 2018, if I'm not mistaken, how would you say your client needs and your overall service model has evolved. Have you seen shifts in scope, complexity in the overall legal work that you've been doing over the past seven, eight years?

[00:38:05] Nestor: Yeah, that's a great question. When it was 2018, the only compliance frameworks that framework that the most of the crypto companies had to follow was the anti-money laundering framework.

[00:38:18] Nestor: The FATF back to that time it was 2016 or 2017, FATF issued the guidance to provide some sort of the overview of the requirements for crypto companies, how to maintain their AML compliance and since that time, the number of compliance frameworks grow up from one to 10 plus within every country. So we have the project operates in three countries, that 3x multiplier to this compliance frameworks. And that's something that substantially increased the scope of support that these companies required. And that's where we figured out the mission that we want to pursue for this market to help these companies to reduce this market barrier by providing them more affordable and more efficient compliance solutions.

[00:39:14] Umar: Perfect. Now maybe a last question Nestor before we wrap up is on, now that the GENIUS Act has been passed, what is next in, in terms of crypto regulation? Maybe we should do another episode on the Clarity Act in the future, and could you already provide us with maybe a high level overview of what that entails and also in general, where should digital asset providers be watching in terms of like regulation over the next 12 months or so?

[00:39:47] Nestor: So I would love to have another episode about the Clarity Act because that's what a lot of the market players are expecting now. Unfortunately, the most of non-custodial solutions like DeFi protocols and non-custodial wallets still remain in a gray zone.

[00:40:04] Nestor: It's still unclear should they get licensed or not. Should they verify their users or not? Should they run some audits of their funds, etc. So yeah, Clarity Act is the piece of the legislation that should provide some clarity for it.

[00:40:24] Nestor: And another big topic is RWA that we slightly touched today.

[00:40:29] Nestor: I think that will become a huge trend next year once the EU introduces this regulatory framework and, a lot of the countries are now working on it as well. So yeah, that's probably something that crypto companies might take a look, take a closer look because that might become a big topic very soon.

[00:40:51] Umar: Perfect. Now, today's episode, Nestor was on stablecoin issuance regulation.

[00:40:57] Umar: As closing thoughts, has there been anything that we didn't touch on that you'd like to share with the listeners or how would you summarize this episode today for the listeners?

[00:41:08] Nestor: I think that in the next couple of years one of the biggest challenge for the most of crypto companies that are borderless by default will still be this issue of regulatory interoperability.

[00:41:21] Nestor: So, as the summary especially for the projects that are on the early stages, I would suggest to think about the primary markets because that's the markets where the license will be needed for the first time and the more countries pass the specific laws for stablecoins and tokens, the harder for the web3 projects will be to operate globally.

[00:41:46] Nestor: So this primary markets will be very important for builders very soon. But I hope that in next like three to four years some activities, some cross border activities of the regulators will start happening as well because that's what market requires to, for the projects to be able to operate truly borderless with lower compliance costs for their operations.

[00:42:14] Umar: Perfect. Yeah, we just pray that these new regulation, in a way, will not kill the very ethos of blockchain, which has been so far yeah, pseudonymity, being borderless and but probably in a way for more to achieve like this mainstream adoption, we do need it, but we just hope it won't kill the innovation that these companies brought.

[00:42:36] Umar: Now I have a last question, Nestor, which, and this is how I like to end the podcast, is do you have a favorite quote or like a maxim that either you live by or you repeat to yourself like very often?

[00:42:51] Nestor: Oh, that's a great question. So, it's a very fast changing world and I think that, to be anti-fragile is, one of the most important type of mindset for all entrepreneurs.

[00:43:05] Nestor: So that's something that I would like to share and wish to all builders and entrepreneurs who will be watching this video, this podcast to be anti fragile and to learn really fast. So that, that's probably two things that help every company, every project to succeed in the current business environment.

[00:43:26] Umar: Perfect. I agree and thanks a lot for sharing and Nestor, so thanks a lot for your time today. I think we recorded this episode at the right time when there's gonna be a lot of people looking into how to embrace stablecoins in their business or how to issue stablecoins. So thanks a lot for your time today.

[00:43:48] Umar: If people want to learn more about Legal Nodes, if they want to reach out to you, where should they go?

[00:43:53] Nestor: Our website would probably be the most the shortest way to, to get in contact. But I'm also available in LinkedIn and on X. So always happy to talk to builders and discuss the recent regulatory updates in the crypto industry.

[00:44:08] Umar: Perfect. Thanks again for your time today and we'll stay in touch.

[00:44:13] Nestor: Thank you so much for having me here.