Building the Operating System for RWA Tokenization with tx

GM GM. Welcome to what's going to be another fantastic episode of DevNTell. So if you didn't know, DevNTell is a 30-minute podcast held every week, allowing founders, hackers, and anyone in between the opportunity to come on the show and showcase what they've built. And today, I'm ecstatic to welcome Mike McCluskey and Ashley Ebersole, who are the co-founders of tx. If you didn't know, tx is a unified operating system and marketplace for Real World Assets, RWAs, with tech, compliance, and liquidity all built in. So if you stick around for today's episode, you'll get to meet Mike and Ashley, learn about the tx platform, enjoy an engaging conversation about RWAs. I know there's a interesting discourse on the timeline today around that. So you'll definitely want to check this out. And, yeah, let's get into it.

GM GM, welcome to the show, Mike and Ashley. I'm ecstatic to have you both on today. My pleasure, my pleasure. I know RWAs are all the rage, especially this year with more regulatory clarity developing and whatnot. So I know I am excited for this episode, as I'm sure our audience is. But before we get into all that fun stuff, as well as all the details around tx, would you both just like to give an introduction about yourselves?

Yeah, sure. Well, great to be here. Appreciate it, Narb. A little bit about myself. So Mike McCluskey, I'm CEO and co-founder of tx. Been a part of the team here for just over three years. Spent many years at Fidelity Investments and in traditional finance, and also been in fintech for a number of years. And tx is, as you mentioned, the operating system for tokenization. And, yeah, really excited to be here.

And I'm Ashley Ebersole. I'm the Chief Legal Officer and a co-founder also. I've worked in financial regulation for my whole career as a lawyer. You know, I was at the beginning of in the early days of crypto, familiar with the big Layer 1s from personal interest. But I was at a New York law firm and crypto companies weren't really hiring law firms like that at that point. They are now. So it was not a work stream that I had there. But I went to the SEC in early 2015 and joined the working groups that were looking at these issues, how the SEC should approach these assets. And it was extremely interesting, trying to help them shape the right approach to these assets. There were some great actors in this space. There were a lot of bad actors in the early days who were trying to capitalize on the fact that it was a new and unfamiliar technology and make money in illegitimate ways. But, you know, I think we've been through some more difficult years with SEC in the previous administration that very few people agreed with its approach. The current SEC is really open to working with the industry. And, you know, I think we're in the right place. So great to be here with you to discuss all this.

Yeah, absolutely, absolutely. And yeah, definitely there's been, I would say, way more downs than ups in this industry. But the true OGs and people dedicated to the game, so to speak, are the ones that still stick around. So I guess what got you interested in crypto and stuff? I know, Ashley, you kind of went into a little bit. But Mike, what about yourself? What got you really interested in crypto and kept you here?

Yeah. So when I was at Fidelity Investments, there was actually a small team working on understanding Bitcoin and researching Bitcoin. And these were early days. I didn't really I had never actually heard of Bitcoin. And so that's kind of what got me interested in it. I ended up working at a fintech accelerator program for a couple of years, and we saw all types of fintech companies coming through the program: payments, lending, you name it, we saw it. However, some of the most interesting and I would say revolutionary startups that we were seeing were blockchain-related. And so I ended up taking a blockchain course at MIT and got very involved in the Boston Blockchain Association. And, you know, everything I learned about it at that time was that it was really a revolutionary technology that was on par with, you know, the railroad and internet, which I still firmly believe. And so one thing led to another, ended up meeting the the co-founders of our predecessor companies. So I can share more about our evolution, but tx is actually the strategic merger of two companies, Sologenic and Coreum. I ended up meeting the Sologenic team, the co-founders, and ended up joining about three years ago to lead business development and really kind of build out the tokenization infrastructure and business unit, I would say. And yeah, it's been been interesting ever since. I think we're still very early days as it relates to crypto and blockchain and especially tokenization. And yeah, excited for what's next.

Yeah, absolutely. Ashley, did you want to comment?

Oh, well, as you said, I think I already gave a good amount of background. Before this I was General Counsel of the big DeFi aggregator 0x. Great team there, great experience building in the DeFi space. Encountered the team behind tx a few years ago, stayed in touch, and when they told me what they were building with tx, it was really interesting. I do think tokenization is the next wave of crypto assets and was excited to get involved and joined about a year ago. So we've been building since then and have launched some products and will be launching more in the near future.

Excellent, excellent. Yeah, I guess let's get into it. Before we get into tx though, for our audience who might not be as deep in the industry, deep in the weeds around securities, assets, real world assets, could either of you or both of you give your perspective and explain why people should care about the tokenizations of RWAs and why does it matter?

Happy to start with that. As Ashley just pointed out, tokenization in my opinion is really the killer use case for crypto. Taking a real world asset, a tangible asset, and tokenizing it, having a digital representation of it on the blockchain, a ledger, is really where things are going. I think at some point in the future, every asset with any value is going to be tradeable, fractionalized, democratized, and have instant settlement. You look at real estate, commodities, collectibles, intellectual property, you name it, any tangible asset is going to eventually have its own token associated with it. There's been study after study of where this is going as an industry. I think $30 trillion is going to be on-chain in the next five or so years. And so what we're doing is we're positioning ourselves for that inevitable future where everything is going to be tokenized. You look at Larry Fink, the CEO of BlackRock, he believes the same thing. He thinks every asset is going to be tokenized. Our goal is to be that end-to-end operating system for tokenization. And I think that's really, in my opinion, RWAs is really why crypto will exist in 10, 20 years.

Well said, well said. Ashley, yeah, go for it.

I was just going to add that the efficiencies that blockchain brings to financial instruments, that's why the New York Stock Exchange, Nasdaq, the SEC, big European banks, big global financial institutions are looking at this. They see the transformative potential, and it's just a matter of time before it becomes the system of record underlying financial instruments on a much bigger scale.

Absolutely, absolutely. A lot of people don't realize how complicated all this is to actually orchestrate and bring together and play within the lines, so to speak. A lot of folks go about solving a piece of the puzzle, but as far as I understand, a lot of the pieces of the puzzle are fragmented. I'd love to segue into tx now and learn a little bit more about the platform and let you guys tell the story behind it.

Yeah, absolutely happy to talk more about that. As I mentioned, we are the strategic merger of two previous crypto projects. Sologenic was founded about 5-6 years ago at this point, and the co-founders of Sologenic saw the future with blockchain and tokenization and started building out the infrastructure, launched our own Layer 1 called Coreum. That Layer 1 was specifically designed for tokenization. And so over time, they saw where this was headed. I joined the team a few years ago, Ashley joined about a year ago, and our goal is to really be the infrastructure for end-to-end tokenization. As you mentioned, it's very fragmented right now. You have technology companies—we would consider ourselves a tech provider—but tokenization requires being able to navigate the regulatory environment. So we've aligned ourselves with regulated entities, broker-dealers who can help with that regulatory aspect. We've also launched an app called the tx Super App, which we believe is one of the biggest opportunities right now: a good user experience for investing in tokenized assets. We try to be the all-in-one operating system for tokenization.

Yeah, I think you hit it with liquidity. Previously, when you're thinking about tokenized assets, you're like, 'Okay, I want to buy tokenized real estate, I know where to go for that. I want to buy tokenized intellectual property, collectibles,' whatever it is. But where to go for that is a single place, and most of liquidity having to do with those instruments is siloed within that single place. The idea with tx is that with our tech, we can connect various regulated entities and have an interconnectedness where people can come in, transact in tokenized whatever it is, see a regulated provider where they can do that, connect with that regulated provider, and it all remains on the tx chain.

And our end goal really is to be the Robinhood or the Amazon of tokenized assets, where you can go onto one app, have your tokenized stocks and ETFs, real estate, commodities, collectibles, all in one place on-chain. There's now trillions of dollars on-chain. What we're trying to do is meet the users and investors where they currently sit on-chain, but then also bring new assets that have never been investable for the everyday retail investor, trying to bring those assets on-chain within one marketplace.

Amazing. Tying all these pieces together—the infra, the compliance, the marketplace—and doing it the right way is very hard. So kudos to you guys for taking on that Goliath of a challenge. In terms of the market response that you've seen from people willing to take that step and go down the tokenization route, how has this trifecta of pieces helped you guys get grounding and traction?

Yeah, I mean, we're having lots of conversations with institutional asset issuers. The challenge for them is finding investors and raising capital. We're also talking with retail investors who want to be investing in these types of opportunities. So for us, we think the biggest gap right now is a central application or marketplace that's connecting all the dots from a regulatory perspective, but also institutional asset issuers, and connecting them to retail investors. That's really what we're going for. As far as we can tell, there's really no good user experience yet around tokenized assets. There are of course companies working on it, but we believe we're ahead in terms of understanding the landscape and what it's going to take to actually tokenize these assets. In the last month when we launched our app, we have over 100,000 downloads, 125,000 downloads or so. We're going to be introducing new products into that application, which eventually will be our tx market with tokenized stocks and everything else. So yeah, we're trying to be the central hub for it all.

No, I think you hit it all. We are building the infrastructure for the products that are currently in development, but really for what's coming next also, as the wave of assets coming on-chain accelerates and we've got more and more different options for investors on-chain. We think the tx platform is the place that they're going to want to transact in those assets.

Amazing. Double-clicking on U.S. securities a bit. Ashley, I know you mentioned earlier that you served as senior counsel to the SEC. You were there in the early days. From your perspective, how has the tune changed from a legal and regulatory standpoint into people being more game to have U.S. securities start to be tokenized?

So I didn't mean to say that it was all bad actors when we were there. There was a big lack of clarity on the legal mandates. You are a startup, it's a new technology, you want to start issuing tokens. If you didn't have a lot of legal sophistication or VC backing where they told you, 'Hey, you need to talk to legal counsel first,' people issued assets. Okay. The SEC put out the DAO report saying, 'In a situation like this, if it looks like a security, it meets these criteria, we're going to treat it like a security. We don't care that it's a crypto token.' I think there was still a lack of clarity after that because there were a lot of questions of, 'Okay, but if you're saying it is a security, you haven't adapted any of the regulations to what this technology is, how you handle custody, how you handle the things you have to have inherent to an offering of instruments that are securities.' I do think that there were a lot of good actors who were trying to do right and were talking to the SEC. You could have those conversations then. Was there fraud? Yeah, there was undoubtedly fraud also, but that wasn't everyone by any means. But then we moved into the prior administration at the SEC, and I was back at a law firm by that time counseling a lot of companies in this space. You could still go in and have conversations with the SEC staff, they were willing to talk to you and offer feedback. Those conversations shut off at some point within a year of that administration coming in, and things turned from an atmosphere of still being able to work with the SEC to it being just a very aggressive anti-crypto environment. So that was a very difficult time to be in this industry. The recent change with the current administration has been apples and oranges. You have an SEC chair who has worked with this industry before, who is well versed in the technology. You have staff there who are both very well versed and interested in the technology across the agency. So you've got the absolute right alignment right now to do the work that needs to be done to solidify more of the legal basis around these instruments and make it that much more clear how these instruments will function.

Absolutely.

I was just going to add one quick thing. Ashley nailed it. Our team met with the SEC Crypto Task Force recently and had a very productive conversation. We talked about our Smart Token technology and our infrastructure. So I would echo that they've been very receptive to these types of conversations.

Yes, and hopefully it stays this way and we stay the course and don't have any derailments, so to speak.

We've at least got a few more years before you've got to worry about a diametric change. But the hopeful person in me wants to think that we've moved beyond the prior perspectives of some on this industry and that the industry's here to stay, so to speak, and we won't go back to that is my view. But remains to be seen.

We'll see how it plays out. It's never a dull day in this industry, that's for sure. Shifting gears a bit, as this is a developer-oriented show, just wanted to ask and see what kinds of developer tools, SDKs, APIs are available for people to start building and using tx today?

Yeah, happy to give a quick overview on that. Neither of us are tech-oriented, but as I mentioned, we have our tx Super App, which you can download in Apple and Google Play. We have mini-apps within this Super App. So we are welcoming any developers who want to launch any type of application on the tx chain. We'd love to talk with you. We recently proposed and presented what I call the economic program, which had three different parts to it. One was related to our tokenomics, and we put it out to a community vote, which passed. The second part was related to a programmatic buyback program. And then the third part is related to developers and builders. What I would say for our company is we're not really taking a cookie-cutter approach to the grant program. We're looking for developers and builders who perhaps are even interested in joint ventures or revenue sharing. We are backed by a VC, Corenest VC, that is also investing in these types of opportunities. And so we presented a whole economic package of how that would work with developers who want to build on the tx chain or adjacent to the tx chain and connect to our ecosystem. But we're definitely making a call to any builder, please reach out to us. We're happy to talk, happy to be creative. You can do it through partnerships@tx.org as our email. You can reach out on X or LinkedIn. We have a Developer Hub where there's a lot of tools and resources to get started on building on tx. And yeah, we're making it loud and clear that we want more people building on the tx chain. We believe we are the premier chain for tokenization. There was a lot of time and effort long ago, from the get-go and the foundation of how this was built, to make sure that it was specifically designed for tokenization of real world assets. If you believe in RWA, which we certainly do, then this is the chain that you should pay attention to and build on, and we are more than happy and welcome to have those conversations with you.

Yeah, I just wanted to add, because I think it's one of the most interesting aspects of this chain, that our Smart Tokens are a huge part of this because they actually allow programming to be at the token level. So for geographic restrictions, for whitelisting, blacklisting, for freezing, that sort of thing, that's all programmed in. So rather than being enforced by smart contracts, it allows a lot more functionality from a developer perspective, from a regulatory perspective. The tokens are that much more usable because they can be controlled in a way that most others cannot.

Well said. And for viewers and listeners, all those resources will be in the description of the podcast below. So if you're interested, definitely check that out. As we're closing in on time, you two have a wealth of experience going through the trials and tribulations to get to this point. For the aspiring founders and builders watching today who might be on the fence of starting their own company or venture, what's some key piece of advice you'd be willing to offer, maybe advice you'd want to give to your younger self?

Yeah. I'm learning every day still. I think this is an ongoing, lifelong journey of becoming a good founder and entrepreneur. For me, it's putting your blinders on and just going forward. There are disruptions and distractions and problems that arise every single day. But if you take the approach and have the mindset of being a problem solver, and recognizing that any problem that comes up can be solved if you have the right team and resources and willpower to just move forward, that's really what counts. At least what I've experienced so far, it's just moving forward and continuing to build and not letting up and not giving up either. So staying at it.

My view is that being a startup founder is a volatile experience. Only in that you have your ups, you have your downs. I think that's a lot of what Mike's talking about when he says attitudinally you've got to remain forward-focused, or else you're going to get lost in the weeds of 'Oh my gosh, that happened yesterday, look what's happening.' You've got to be able to focus. There're going to be good times, there're going to be bad times. Having the right team around you, selecting that team thoughtfully, knowing that when something does come up, whether it's something you planned and you're like 'Okay, we got to develop this functionality, I know the group I'm going to put together to work on that and they're available and going to respond to me quickly,' that sort of thing is huge. So when you get the right people around you, I think that makes this building experience that much easier and that much more possible.

Excellent. Well said by you both, and I couldn't agree more. So if you're someone watching today aspiring to get off the fence and start your own venture, no better pieces of advice than from Mike and Ashley. As we're closing in on the last few minutes here, I just wanted to give you an opportunity if you wanted to share anything that you have planned for the rest of the year in terms of roadmap items or anything you wanted to tease out?

Yeah. So we've been working on tokenized stocks, our stock tokens, for quite a while, looking to launch that. Also many other assets coming on the tx chain. We're also working on a native stablecoin, which hoping to announce more and share more on that soon. But then beyond that, I mean, I think there's a lot up for grabs. I met a company just a couple days ago that has vault infrastructure, and we were talking about how we could incorporate vaults into our app. So we're working on a number of different things and working alongside a few different teams who are building, hoping to build bridges and expand the ecosystem. But yeah, a lot of products coming online soon.

Amazing. And yeah, with that, Mike, Ashley, thank you so much for taking the time out of your busy days to come speak with us today. I know I really enjoyed our conversation, as I'm sure our audience did. And again, gang, if you are interested in learning more about tx or getting started building with them, those resources are in the description of the podcast below. So definitely check that out if it interests you. Really appreciate it, guys. This was awesome.