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PLTs in Action: The Next Era of Stablecoins & PayFI

Validator 85223

• 7 min read
PLTs in Action: The Next Era of Stablecoins & PayFI

Nine months ago, the idea of Protocol Level Tokens was conceived. Today, they’re live on mainnet, redefining how assets and compliance can coexist on-chain. In this session, Erasmus Hagen and Richard Yolland guided the community through the milestones of Protocol 9, the power of Concordium’s identity layer, and the commercial momentum already forming around the ecosystem

1. Introduction

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1 Introduction
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  • Erasmus sets the stage 
    • Focus on Protocol 9, the new release, and the introduction of Protocol Level Tokens (PLTs).
    • Emphasis on excitement around Protocol 9
      • Novel features align with Concordium’s broader strategy.
      • Fits into a market where stablecoins are gaining global attention (even SWIFT exploring them).
  • Richard Yolland introduces himself
    • Head of Solutions Engineering at Concordium, with >1 year at the foundation.
    • Former Head of Solutions Engineering at Copper (worked with Boris).
    • 21 years in investment banking (JP Morgan, BNP Paribas), payments expertise.
    • Early background in particle physics.
  • Erasmus Hagen introduces himself
    • Director of Product at Concordium.
    • Entire career in crypto/technology on the product side.
    • Long-term perspective: always saw regulation as essential for money to work.
    • Joined Concordium because of its founding vision
      • Regulation is inevitable.
      • A native identity layer is required.
      • Must balance regulation with privacy protection.
    • Believes Concordium is in a strong position given current market, political, and regulatory shifts.
  • Comments

2. Protocol 9, PLTs and the Identity Layer

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2 Protocol 9 PLTs and the Identi
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  • Protocol 9 rollout
    • Recently launched smoothly on mainnet.
    • First Protocol Level Tokens (PLTs) already issued.
  • Development speed
    • Concept only signed off by the board at end of January.
    • Built and released in ~8 months.
    • Acknowledgment of both internal and external teams for exceptional delivery speed.
    • Delivery velocity increasing; more product launches expected at a faster pace.
  • Core innovation of PLTs
    • Tokens issued natively at protocol level, not via smart contracts.
    • Limited scope by design: focus on a few important functions done securely and reliably.
    • Avoid risks of smart contracts (copycats, hidden changes, attacker exploits).
    • Easier compliance and simpler integration into business processes.
    • More efficient: executed closer to the protocol’s runtime rather than on an abstraction layer.
  • First use cases
    • Initial PLTs focused on stablecoins.
    • Three issuers live: VNX, StablR, and Aryze.
    • Ten PLTs initialized on-chain.
    • Future plans are under wraps for media/marketing impact — “wrapped in a cloud of secrecy.”
  • Product perspective
    • ERC-20 style tokens have caused losses, confusion, poor UX due to complexity and inconsistency.
    • PLTs streamline the environment, reduce risk, and align with needs of serious merchants and financial institutions.
  • Identity layer integration
    • Concordium’s native identity layer is unique — not an afterthought.
    • Uses zero-knowledge proofs to preserve privacy while enabling compliance.
    • Every account creation requires an identity check, producing a private identity credential.
    • Identity disclosure, if ever required, can only happen via the Swiss courts — combining novel tech with trusted legal systems.
    • Enables regulatory compliance tools like Travel Rule adherence.
  • Comments

3. Commercial Value

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  • Value of the chain is the ecosystem.
    • Not just Concordium itself, PLTs, or the ID layer.
    • Real value comes from wallets, on/off-ramps, exchanges, custodians, dev houses, stablecoin issuers, monitoring/intelligence software, partners, and the broader community.
  • Ecosystem building
    • Focus is on relationships, deals, and making Concordium appealing with unique features.
    • Example: Kraken listing — highlighted as the result of negotiation, money, and effort.
  • Compliance positioning
    • Clarification: Concordium is not itself “a compliant blockchain,” but its features enable compliance for organizations using it.
    • Built originally for institutional clients; now market timing is favorable with ETFs, corporate adoption, and institutions moving into blockchain.
    • Transition away from crypto’s Silk Road past toward transparent, institutional use cases.
  • Cost advantage
    • Transaction fees pegged to fiat (currently €0.01).
    • Provides predictability and planning for institutional clients, unlike Ethereum’s volatile gas fees.
  • Commercial confidence drivers
    • On-chain compliance capabilities.
    • PLTs’ programmability and tokenization features.
    • Low, predictable fees.
    • Regulatory reach through the ID layer.
  • Use cases (active, though not yet named)
    • Concordium working with a national government and its police service on digital EUDI wallets.
    • Interest from major global banks: stablecoins for cross-border payments, but especially compliance features such as ZK proofs and real-time KYC through the ID layer.
    • Practical example: age verification (gating) in gaming and social media (ties into Verify & Pay, covered next).
    • Industry demand to integrate ID + PLTs for compliance, safety, and user protection.
  • Positioning
    • Institutions do not want to be left behind as blockchain moves mainstream.
    • Concordium’s ecosystem + PLTs + ID layer = compelling platform for regulated, real-world adoption.
  • Comments

4. Verifying Pay and Age/Access

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  • Flagship product
    • Erasmus describes Verify & Pay / Verify & Access as a flagship initiative.
    • Responds directly to regulatory and societal trends (e.g. UK Online Safety Act).
    • Marks the end of the era of pseudonymity/anonymous online access.
  • Concept
    • Concordium combines its identity layer with its payment mechanisms.
    • Merchants in industries with compliance requirements (alcohol, tobacco, gambling, pharma, age-restricted services) can integrate a library to verify users.
    • Analogy: as simple to integrate as Stripe for payments.
  • How it works
    • Merchants must have a Concordium account (onboarded, identifiable).
    • Users scan a QR code or deep link with their Concordium Identity App.
    • A zero-knowledge proof verifies required parameters (e.g. over 18, resident of a specific country) without revealing underlying personal data.
    • Payments can be tied to verification, guaranteeing the payer meets compliance requirements.
  • Auditability and accountability
    • An on-chain audit log enables investigations while preserving privacy.
    • Example: merchants fined by UK regulator Ofcom could have avoided penalties with such tools.
  • Value proposition
    • Provides accountability for both merchants and users without leaking private information.
    • Demonstrates the synergy of Concordium Identity + Concordium Pay + PLTs.
    • Directly addresses high-demand industries needing workable compliance solutions.
  • Comments

5. Commercial Use Cases and Industries

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  • Nationality and residency checks
    • Concordium wallets also contain nationality as part of setup.
    • Enables merchants to apply restrictions based on nationality or residency (e.g., alcohol purchase age differs by country: 16, 18, 21).
    • Enforced through zero-knowledge proofs, maintaining privacy while meeting local rules.
    • Conceptually similar to geo-fencing for wallets.
  • Healthcare and pharmaceuticals
    • Use of ZKPs for privacy-preserving identity verification.
    • Supports patient research and protection of confidential medical data.
  • E-commerce and retail
    • Application of Verify & Access and Verify & Pay to gate services, verify users, and ensure compliant payments.
    • Strong relevance for industries where regulators are demanding online controls.
  • Trade finance
    • Currently highly complex and slow (letters of credit, supply chain coordination).
    • Concordium + PLTs can simplify through:
      • Scheduled releases and tranches.
      • Conditionality (enabled by smart contracts for specific triggers).
      • Active client discussions exploring rebuilding the industry with this model.
  • Overall framing
    • Multiple real-world industries already in discussion or build mode.
    • Emphasis on broad applicability: compliance, privacy, programmability, and efficiency.
    • Concrete use cases extend far beyond stablecoins and payments.
  • Comments

6. Community Questions

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  • 6.1 Benefits of PLTs
    • Highlighted advantages: cost, compliance, security, programmability.
    • Protocol 9 is just the first building block — future phases will expand features and programmability.
  • 6.2 Interoperability / bridging
    • PLTs intentionally limited in scope to reduce smart contract risk.
    • Capabilities will roll out in phases.
    • For now: payments, swaps, buys, sells mainly via centralized exchanges/on-ramps.
    • Bridging depends on issuer-specific solutions; further details to come.
  • 6.3 Privacy of company revenues
    • Companies can obscure inflows using multiple addresses, PSPs, and wallet-as-a-service solutions (e.g. Fireblocks, Finoa).
    • No public “telephone directory” linking addresses to company names.
  • 6.4 ZKPs + RWAs / financial products
    • ZKPs preserve privacy in public ledger systems while allowing trust.
    • Example: trade finance — escrow release tied to shipment events, attested by private actors via ZKPs.
    • Enables products like private lending and asset-backed derivatives without exposing counterparties.
  • 6.5 Industries excited about PLTs
    • Already covered earlier: banking, e-commerce, healthcare, trade finance, compliance-heavy industries and just generally PayFi/stablecoins
  • 6.6 Expected transaction growth
    • No firm numbers — depends on awareness, uptake, marketing pushes, UX improvements, partnerships, and releases.
    • Belief that growth will be strong once utility is visible, but timing uncertain.
  • Comments

7. Identity App

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  • Dedicated ID app
    • Concordium has rolled out a standalone app for the identity layer.
    • Marks a milestone in putting Concordium’s identity functionality at the forefront.
  • Privacy-first design
    • Identity app enables sophisticated use cases while safeguarding privacy.
    • Current work focuses on a full rework to strengthen UX and reinforce privacy-first principles.
    • Aim: a natural, default choice for online identity verification whenever websites or services require it.
  • Vision
    • Goal is to make identity verification frictionless and user-friendly.
    • Strong design work underway to ensure adoption feels natural and intuitive.
  • Governance Q&A
    • Question raised about who holds authority over PLT logic, allow/deny list policies, and identity provider onboarding/removal.
    • Foundation Board holds ultimate authority.
    • Governance Committee (GC) reviews and comments, but decisions are based on EMG (Executive Management Group) recommendations.
    • EMG = Concordium’s C-suite (commercial, technology, operations, marketing).
    • Foundation steps in if disputes arise, but generally all stakeholders align on direction.
  • Comments
  • https://t.me/c/1659427635/35442 (129 words)

8. Wrap-Up

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  • Closing reflections
    • PLTs were conceived just 9 months ago and already launched with strong momentum.
    • Much more to come, positive response across the board so far.
    • Acknowledgement that building is the core focus, but community input and adoption are essential.
  • Key message
    • “It’s not worth building anything if nobody is using it.”
    • Positions Concordium as the bridge turning visionary ideas into reality for institutional clients and end users.
    • “Let’s buckle up for the ride.”
  • Comments

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