Episode #190: The Coming Neobank Shakeout? with Olivia Vande Woude of Ava Labs

Hey everyone,Olivia Vande Woude is Tokenization Lead at Ava Labs. I caught up with her at the Bitso Stablecoin Conference in Mexico City in June to discuss the distribution challenge facing tokenized real world assets.Issuance has become commoditized, and the real fight now is over distribution. Olivia argues that most tokenized assets have targeted crypto native users, a limited addressable market compared to plugging into existing financial pipes.🙌 You can listen to Bits and Borders on your favorite podcast platform YouTube | Spotify | Apple Podcasts🔥 Join our English language Telegram group to continue the conversationBits & Borders is Presented by SumsubSumsub recently released its fourth annual State of the Crypto Industry report. The new research reveals how digital asset companies are balancing fraud prevention, regulatory pressure, and user experience as they scale in 2026. This report draws on Sumsub’s internal data from 2024–2025 and insights from 300 crypto companies surveyed outside Sumsub’s customer base.Some of the key global highlights include:* Crypto firms are moving away from ‘growth at all costs’, with 74% now prioritizing verification accuracy over user onboarding speed (39%).* Despite fraud rates remaining flat at 2.2% from 2024 to 2025, crypto firms operate in a structurally riskier environment where targeted, automated and AI-driven attacks are the new normal.* Over half (55%) of surveyed companies confirmed they experienced fraud at least once in 2025, with 15% unsure if it happened or not–emphasizing the lag between detection capabilities and growing fraud sophistication.Key takeaways:* Open Trade, an Ava Labs partner spun out of Circle and backed by a16z and Mercury, has surpassed $200 million in TVL by offering stablecoin yield products of 3% to 13% through a B2B2C model with neobanks, exchanges, and wealth tech platforms, mostly in LATAM and APAC.* Olivia expects a wave of consolidation among crypto neobanks and card issuers, predicting either mergers among smaller players or acquisitions by larger incumbents that already control distribution and user bases but lack tokenization technology.* Crypto-backed card issuers like Rain have gained an edge by becoming principal members with Visa and forging partnerships with MasterCard, positions that are difficult for smaller competitors to replicate.* Axiom uses stablecoin infrastructure on the back end to eliminate pre-funding requirements for MSPs and PSPs, freeing up 70 to 90 percent of working capital that would otherwise sit trapped on their balance sheets.* Olivia is skeptical of vanity metrics like wallet counts and points to the distributed versus represented asset metric on RWA.xyz as a better signal of real utility versus assets that are effectively just sitting in a database.* Ava Labs is also working with Blerify on digital ID and credentialing infrastructure built for a quantum resistant world, with new government and public sector partnerships expected in the coming months.I enjoyed this conversation with Olivia and I hope you do as well. You can connect with her on LinkedIn.Have a great weekend everybody. -AWSRecent Episodes Get full access to Bits and Borders at bitsborders.substack.com/subscribe