The Float Is the Business
AX1@ax1vc
−4.1%
since Sep 30
The idea
I don't think agent payments make money on fees, since agents pay fractions of a cent at a time and settlement costs even less. The real money is the float: every paying agent holds a balance that sits idle most of the day, and whoever custodies that cash earns the interest on it. So this owns the balance sheets underneath agent money, stablecoin issuers, brokers and custodians who sweep idle cash, and deposit-token banks, while skipping the payment processors entirely.
What it owns
- Brokers earn interest on customer cash sitting idle between trades, a core profit source that depends on rates staying meaningfully above zero. · Charles SchwabIt is the largest broker earning substantial interest on customer cash that sits idle between trades, a core profit line that depends on rates staying elevated., Robinhood MarketsIt earns interest on customer cash and operates crypto rails, so it captures idle balance interest today and could hold agent-adjacent balances tomorrow., Interactive Brokers GroupIt earns a large share of profit as interest on customer balances and holds the automated API-driven accounts that agents would use., LPL Financial HoldingsIt makes much of its profit sweeping advisor-client cash into bank programs and keeping the spread, a pure play on idle balances being a sustainable business.34%
- These companies earn interest on the dollar reserves backing stablecoins that agents use for payments and hold between transactions. · Circle Internet GroupIt earns nearly all its revenue as interest on the reserves backing USDC, and owns USYC, the tokenized treasury fund where larger balances would sweep., Coinbase GlobalIt earns a share of the interest on USDC reserves through its partnership with Circle, so it profits on stablecoin float without issuing the coin itself.27%
- Trust banks hold and service the reserves behind stablecoins and tokenized funds, and earn interest on the deposits and cash that accumulate in custody accounts. · BNY MellonIt is custodian for both the USDC reserve fund and BUIDL, so it earns on stablecoin and tokenized treasury reserves regardless of where those balances flow., State StreetIt is one of the few custodians large enough to hold stablecoin and tokenized fund reserves at scale, and earns on the deposits sitting in custody., Northern TrustIt earns interest on the cash sitting in the trust and custody accounts it holds, the same idle-balance economics the take depends on.18%
- Banks issuing deposit tokens keep agent balances on their books as low-cost funding, even when dollars move on-chain like tokens. · JPMorgan ChaseIts JPMD deposit token puts bank deposits on-chain, so if institutions run agent balances through a bank instead of a stablecoin, the interest stays on its balance sheet., Customers BancorpIt banks stablecoin firms and holds their dollar deposits as cheap funding, earning a spread between what it pays depositors and what it lends out., Western Alliance BancorporationIt holds settlement deposits for payments and digital-asset firms, so its deposit base grows as agent payment volume increases rather than moving fully on-chain or into swept treasuries.13%
- Cash8%