Hi, I’m Sean Bennett, creator of Stellar’s first (and hopefully second) USD anchor
I can still remember reading about Jed McCaleb’s “Secret Bitcoin Project” in early 2014.
I had been following Bitcoin since mid 2011 when WikiLeaks first started accepting BTC donations. That response to the ‘banking blockade’ imposed on Julian Assange’s organization felt like a sign of things to come…but I wasn’t yet sold on the idea of a “new currency.”
But being able to instantly send money anywhere in the world…that was something.
My entire family on my mother’s side lives in the Philippines. Technology has made us a borderless society in so many aspects, but I was all too familiar with the shortcomings of cross-border transactions.
Any help we wanted to provide was crippled by huge remittance fees, inconvenient regulations, and a sea of rather meaningless explanations for it all.
There were times when they needed immediate help and we had no choice but to endure the process. Even as recently as last month I have driven my mother to the post office (where Western Union is) so that she can get money in before they close at 12:30pm on a Saturday.
And if this was an issue for us, it was an issue for millions of others. There had to be another way.
In my eyes, the technology behind this new currency was it. It was a way to instantly transfer value across borders. To send immediate help.
I saw the potential clear as day.
The 1st Stellar USD Anchor
As we now know, Jed’s secret Bitcoin project was Stellar.
When details came out about what Stellar could actually do, I was all-in.
Here was a protocol built specially for the transfer of value, with a governance and mission that aligned perfectly with what I find important — connecting the world (and more selfishly, connecting my family).
A decentralized way to send and receive money in ANY pair of currencies. No remittance notes. No shoddy fees. No banks to slow you down.
It even satisfied my then geeky (…still pretty geeky) altcoin fascination.
I dropped everything and put 100% of my focus into getting these ‘everyday’ currencies onto the Stellar network. The regulatory environment was challenging (on top of learning this new technology), but we worked day and night to push through.
And a few months later, that’s exactly what I did with Coinex Gateway.
Myself and two other guys in a small office all the way out in New Zealand launched Coinex mid-2014 as the very first Stellar anchor.
We came out as the first regulatory-compliant gateway offering USD, AUD, NZD and BTC on the Stellar network.
Almost 4 years later, I still remember what it was like at the beginning. Things were moving quickly.
Even all the way out in New Zealand — what often feels like the corner of the globe — we had a great opportunity to engage with the Stellar team in the early years.
(Kia ora to all the kiwis out there!)
My first in-person interaction was with Stellar’s former Head of Growth, Tammy Camp.
She had made the 14-hour journey to NZ’s North Island to attend the wedding of one of the founding members of Square (who now happens to be a Stronghold investor).
We all met and geeked out over Stellar and the future of blockchain.
These relationships led to great things for Coinex.
In early 2015, Stellar partnered with Coinex for their first fundraising auction. Together we raised over $1.5 million to fund ongoing Stellar operations.
There’s no doubt that the launch of Coinex was a significant milestone, but it was bigger than that. It showed what was possible for the larger blockchain ecosystem.
Until then, no other service had provided US dollars on the platform.
Despite our early momentum, the Coinex Gateway closed its doors later that year.
People ask me all the time how or why we would possibly shut down when we had seemingly so much going for us.
In truth, we were just too early.
People were still labelling the space as ‘bitcoin’ as opposed to blockchain, funding wasn’t so readily available, and most importantly the community wasn’t there to build services and engage with the technology.
But Coinex was hugely important for blockchain adaptation. Coinex ledger transfers have even been cited in research to make the case.
It helped us get to where we are now. And now, the timing is just right.
The 2nd Stellar USD Anchor
In 2017, Tammy and I joined forces to launch the Stronghold exchange.
Stronghold is an altcoin trading platform with 20,000+ users. We also operate an over-the-counter (OTC) trading desk for cryptocurrencies.
That huge potential I saw back in 2011 — a major change in how we transfer value around the world — that moment is here.
Government departments have finally caught up & knowledge is being shared at the highest levels. (I’ve spoken with regulators who know much more than most ‘blockchain consultants’)
Blockchain, and more importantly, blockchain-based business cases are being published in academic papers.
The current focus of blockchain is real-world adaptation. Up next? Customer experience.
For us, this means it’s time to innovate more aggressively than ever.
Stronghold is headquartered and funded in Silicon Valley, but we recently moved operations to New Zealand for trading compliance. We didn’t want our users to have to change the way they trade.
For the next 12 months, our focus is adding more assets and liquidity onto the platform. Once we reach a high liquidity threshold, we plan to onboard asset managers to our service.
We are also building a crypto asset management platform. Asset managers will have custody and be able to trade on behalf of their clients. In turn, clients will have a way to login, get reporting, positions, tax forms etc.
I’m still driven by what initially inspired me: global financial access for people and families at every level.
We are breaking new ground everyday. And it’s not just our team. It’s the entire community behind us. They provide that spark that keeps us going every single day.
Together we will continue building products that can change the world.