A16z's thesis on stablecoins as a catalyst for a new global “financial stack” shows why crypto really matters (disclosure: a16z is an investor in Miden). It’s not about trading memecoins; it really is about building a wholly new financial order where millions of people around the world have access to cheap, reliable, instantaneous payment and credit services.
The argument goes like this: stablecoins have outgrown their origins as trading instruments and are becoming the foundation for a new generation of global financial products: neobanks, cross-border payments, corporate treasury, and, eventually, credit. Stablecoins give rise to a new form of banking-as-a-service built on onchain infrastructure with self-custodial wallets, combining account, payment, FX, and credit primitives into end-to-end financial products.
But, here’s the catch. As revolutionary as stablecoins are, there’s still a missing layer: privacy.
Payments-specific blockchains are competing on features general-purpose blockchains were never designed for, including privacy guarantees and predictable transaction costs. And privacy isn't a nice-to-have on top of the stack: it's a precondition for the stack to work at all, especially in the markets where it matters most.
This was brought home to me last week when I spoke with Marvin Mujko, cofounder of a soon-to-launch neobank called Sempo.
Sempo, one of Miden's partners, is building a borderless, stablecoin-powered bank, offering one account for the entire MENA region. It will allow users to receive global payments, hold stable digital dollars, send across borders instantly, and convert to local currency when needed. The target customer, as Marvin described it, has never heard of a blockchain and doesn't need to. MENA has 500 million young, digitally native people underserved by modern banking, and 100 million freelancers participating in a growing cross-border remote work economy. In other words: enormous TAM that’s relatively untouched by either traditional finance or the memecoin era of crypto.
Cross-border transfers across MENA currently take three to seven days, with fees ranging from 8% to 12% across intermediaries and FX spreads. Sending money peer-to-peer comes with a structural penalty on the livelihoods of workers who can least afford it. Stablecoins fix the settlement problem. But they don't, on their own, fix the privacy problem. Miden allows Sempo to keep sensitive user data, such as balances and transaction histories, private, addressing the "catch-22" of traditional blockchain transparency that would otherwise be unacceptable in a financial product. It also allows Sempo to program that privacy to meet compliance demands in different markets it hopes to reach.
“Programmable privacy” is essential. The conventional framing treats privacy and compliance as opposing forces; you can have one or the other. ZK proofs, specifically the STARK-based proofs that Miden is built on, dissolve that tradeoff. You can prove that a transaction is valid, that KYC has been satisfied, that funds are clean, without revealing the underlying data. This is what makes the a16z thesis actually executable in the markets it cares most about.
The new financial stack is real. Stablecoins are the rails. But the rails need a privacy layer before regulated, consumer-facing financial services can run on them at scale. Sempo is on track to become the first regulated crypto bank in Egypt. Not despite building on a privacy-first blockchain, but because of it. It shows how stablecoins are real infrastructure in emerging markets, but the type of the infrastructure that’s in the background, rather than something you have to contend with at the user level.
Privacy is the missing layer, making the whole thing work.
A16z’s framing on this is profound and inspiring. It points to how blockchains are real plumbing for the future in markets that badly need better infrastructure. And more than that, it points to how stablecoins are ultimately about more than cheaper and quicker payments. Once customers have wallets and balances, neobanks can begin to offer all kinds of other services, including credit, investing, wealth management, insurance and so on.
But privacy is key. No worker in Cairo wants their salary exposed onchain. No regulated financial institution can operate that way. Public chains trading stablecoins showed the way; the future is private chains that maintain the confidentiality that you are used to in traditional banking.
Privacy Roundup
Aztec Labs acquired Obsidion, the team behind ZKPassport — the protocol and iOS app remain open source.
Darkbloom, an EigenLabs-powered network that stitches together idle Apple Silicon Macs to serve private AI inference, moved from research preview to public alpha — piggybacking on Apple's Private Cloud Compute so providers can attest they can't see the requests they handle.
Hinkal partnered with Borderless to bring privacy to its stablecoin network, letting fintechs, PSPs, and financial institutions plug Hinkal into existing setups for confidential stablecoin flows across regulated payment rails.
PSE shipped a working proof-of-personhood system that lets users verify identity using a government-issued credential without revealing personal data, with the entire ZK proof and revocation checks running on a mobile device.
Liam Glennon on Privacy Podcast
This episode of the Privacy Podcast features Liam Glennon, researcher and analyst at TRM Labs. The conversation challenges one of blockchain's foundational assumptions: that transparency is a security feature.
Using real exploit examples, Glennon argues that full onchain visibility can hand attackers a roadmap; privacy, built correctly, limits that exposure while keeping compliance intact.
Latest on Miden
We are live at Proof of Talk, where our co-founder Azeem Khan will be speaking about what institutional adoption actually looks like, and Head of Communications Ben Schiller will be moderating the panel The New Architecture of Digital Cash with speakers from State Street, J.P. Morgan, and Paxos.
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Till next time.