Interview | TradFi doesn’t see the potential of stablecoins: Mega Matrix
Most traditional investors still see crypto as somewhere between VC and gambling, says Mega Matrix EVP Colin Butler.
While most traditional investors continue to wait on the sidelines for regulatory clarity, the foundations of a new financial system are already being laid—and stablecoins are at the center of it.
- Most investors are sitting on the sidelines of a vast transformation
- Stablecoins are becoming the basis of a new financial infrastructure
- Still, crypto markets desperately need transparency and risk management
According to Butler, a former Wall Street veteran, stablecoins are becoming the internet’s native money layer. In an interview with crypto.news, he explained why.
Crypto.news: You’ve got a Wall Street background. Now you’re in crypto. What are traditional institutions still getting wrong about this space?
Butler: I spent years in traditional markets, and some institutional investors still mentally bucket crypto somewhere between venture capital and gambling. They haven’t internalized that stablecoins are a new financial infrastructure being built from first principles and continually improved.
The other mistake is waiting for perfect regulatory clarity. Regulatory frameworks are never perfectly clear in traditional finance either. They evolve through interpretation, enforcement, and market practice. The GENIUS Act isn’t flawless, but it’s workable.
Institutions sitting on the sidelines waiting for some imaginary all-clear signal are going to be five years late. The ones engaging with regulators, building compliant structures, and learning the technology will have advantages.
CN: What are the benefits of crypto and tokenization that institutional investors are missing?
Butler: The future is programmable treasury management. Right now, corporate finance is running on infrastructure from the 1990s, like wire transfers, ACH, correspondent banking, and T+2 settlement. Stablecoins offer instant settlement, 24/7 availability, programmable money flows, and composability with other financial primitives.
A multinational corporation may need to pay suppliers across six countries. Today, that involves currency conversions, multiple intermediaries, two-to-three day settlement windows, and substantial fees. In five years, that same company could hold dollar-denominated stablecoins that settle instantly, convert programmatically into local stablecoin equivalents, and automatically trigger escrow or supply chain finance arrangements.
Corporate treasurers today generally have to either park cash in near-zero-yield money-market funds or take on duration risk in bonds. Stablecoins offer a third option for earning a 5-10% yield on dollar-equivalent assets with daily liquidity, no term commitment, and transparent on-chain verification. That changes how companies think about working capital.
What we’re building at Mega Matrix is an active treasury operation that generates cash flow through stablecoin yields while maintaining exposure to ecosystem growth through governance tokens. That model – stability plus optionality – is what next-generation corporate treasuries will look like.
The bigger picture is that stablecoins become the money layer of the internet. That’s a multi-trillion-dollar architectural shift.
CN: How do you assess liquidity in crypto markets compared to TradFi? Is the lack of liquidity an issue?
Butler: The liquidity question is fascinating because it cuts both ways. Yes, stablecoins are growing explosively. Transaction volume exceeds the combined volume of Visa and Mastercard. But relative to traditional money markets, this is still tiny. U.S. M2 money supply alone is over $20 trillion. The total addressable market is enormous.
What’s happening is that regulatory clarity, particularly the GENIUS Act, has legitimized compliant stablecoins as dollar-equivalent instruments. That’s funneling institutional demand toward on-chain dollars, both the GENIUS-compliant ones like USDC and the synthetic dollars like USDe that serve different use cases. As this market scales, these yields will likely compress. But we’re years away from that.
CN: That being said, are there any lessons from traditional finance that crypto should actually take more seriously?
Butler: Crypto desperately needs to embrace risk management and disclosure standards from traditional finance. At Mega Matrix, we treat our stablecoin treasury with disclosure, risk limits, and third-party oversight. We’re working with firms like Falcon X for institutional-grade risk management.
The other lesson from traditional finance is capital discipline. The first generation of digital asset treasuries essentially ran on reflexivity – raise equity, buy Bitcoin, the stock goes up, raise more equity, repeat. That worked in bull markets, but you can’t fund operations indefinitely by diluting shareholders.
The breakthrough with stablecoin treasuries is that they generate actual operating cash flow. You can cover expenses from yield, weather bear markets without forced selling, and eventually return capital to shareholders.
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