In 2018, when Bitcoin was trading around $4,000 and most Americans, at least, thought cryptocurrency was a fad, Katie Haun found herself on a debate stage in Mexico City opposite Paul Krugman, the Nobel Prize-winning economist. As Krugman focused on Bitcoin’s wild price swings, Haun steered the conversation toward something else — stablecoins.
“Stablecoins are really interesting and really important to this ecosystem to hedge against that volatility,” she argued on stage, explaining how digital tokens pegged to the U.S. dollar could offer the benefits of blockchain technology without the ups and downs of traditional cryptocurrencies.
Krugman dismissed the idea entirely.
It wasn’t exactly a turning point in Haun’s career, but it was one moment among others that have helped define it. A former federal prosecutor, Haun brings an unusual background to crypto investing, having spent over a decade investigating financial crimes and creating the government’s first cryptocurrency task force. After becoming the first female partner at Andreessen Horowitz in 2018 and co-leading its crypto funds, she founded Haun Ventures in 2022 with over $1.5 billion in assets under management.
Hanging her own shingle hasn’t been without its complexities. Despite her role at a16z and the industry connections that came with it, the two haven’t publicly co-invested in anything since shortly after she launched her fund, and Haun stepped down from Coinbase’s board last year while Marc Andreessen remains a director.
When asked Wednesday night at TechCrunch’s StrictlyVC event about her relationship with Andreessen Horowitz, she downplayed any potential friction while acknowledging they aren’t collaborators exactly. “There’s no ‘gentleman’s agreement,’” she said, echoing this editor’s question about whether there’s any understanding to avoid competing with her former employer. “In fact, I still talk to Andreessen Horowitz. You’re right that we haven’t really done any deals together of late.”
The apparent lack of co-investment could reflect the cutthroat industry or the challenges associated with leaving one of Silicon Valley’s most prominent firms to compete directly with former colleagues. Whatever the case, Haun is now charting her own course, and at the heart of it is stablecoins, which are cryptocurrencies designed to maintain a stable value by being pegged to traditional assets like the U.S. dollar.
Unlike Bitcoin or Ethereum, which can swing wildly in value, stablecoins like Circle’s USDC or Tether’s USDT are meant to trade at exactly $1, creating a digital representation of traditional currency that can move on blockchain networks.
Indeed, fast-forward to today, and Haun’s belief in stablecoins looks increasingly prescient. Stablecoins — which barely existed in 2015 — now represent a quarter of a trillion dollars in value. They’ve become the 14th largest holder of U.S. Treasuries globally. Reportedly, for the first time last year, stablecoin transaction volume exceeded Visa’s.
“I think people who looked at stablecoins a few years ago thought, what is the value prop?” Haun said Wednesday night. “You’ve asked me this before. You said, ‘Why do I need stablecoins?’ And I said, “I refer to this as an ‘If it works for me, it works for everyone’ problem.”
In reality, for most Americans, the existing financial system works reasonably well. We have Venmo, bank accounts, credit cards. But Haun, drawing on her prosecutor’s understanding of global financial systems, says she has long been aware that the U.S. experience isn’t universal.
In countries with unstable currencies or limited banking infrastructure, stablecoins offer something unique, she argues, which is instant access to stable, dollar-denominated value that can be sent anywhere in the world for pennies. “People in Turkey don’t think of Tether as a cryptocurrency,” she said Wednesday, “They think of Tether as money.”
The technology has evolved dramatically since those early debates, certainly. Stablecoins once cost $12 to send internationally. And Circle says its USDC stablecoin is fully backed one-to-one by dollars held in JP Morgan bank accounts and audited by Big Four accounting firms.
Little wonder the corporate world is taking notice in a big way. Walmart and Amazon are reportedly exploring stablecoins, as are other goliaths like Uber, Apple, and Airbnb. The reason is simple economics. Stablecoins provide a way to move the value of U.S. dollars using cryptocurrency rails instead of traditional banking infrastructure, potentially saving these retail-heavy companies billions in processing fees.
But the shift has critics worried about economic chaos. While Circle and Tether are committed to having enough reserves to support their tokens, unlike traditional banks, there’s no insured government protection behind these reserves. Relatedly, if major corporations can issue their own currencies, what happens to monetary policy and banking regulation?
The concerns run deeper than just economic disruption.
