Liquidity matters but it's not the only thing that does

There's a narrative gaining momentum in stablecoin circles: liquidity is the single most important thing.  

Build deep liquidity pools, the argument goes, and everything else falls into place. Products, use cases, corridors are all downstream of liquidity.

I'd push back on that.

Liquidity matters. Of course it does. But if you've spent any meaningful time building cross-border payment infrastructure, you know that liquidity without licenses is just capital sitting in a wallet. And liquidity without first-mile and last-mile connectivity is just capital and not a product.

The real moat in stablecoin payments infrastructure isn't who has the deepest pool. 

It's who has done the unglamorous, jurisdiction-by-jurisdiction work of securing the right licenses, building direct bank integrations, and stitching together the on-ramp and off-ramp rails that actually let money flow from a sender's bank account to a recipient's in a compliant manner. 

This conversation is interesting and deserves to be spoken about more. 

The partnership arms race

Today, every payments infrastructure company is simultaneously competing and partnering with the others to expand coverage. 

That's the reality of cross-border since no single player can or will have global reach on day one. 

At Saber, we work with partners who use our rails for Europe while we leverage theirs for, say, the Philippines. It's a win-win. Both sides extend their corridor maps without building from scratch.

But this partnership arms race won't last forever. It will slow down, and then it will consolidate. 

When it does, the dynamics shift. 

Larger payment ecosystems will start gatekeeping access in the form of higher onboarding fees or network joining fees, monthly minimums and tiered pricing. 

New entrants will either pay a steep premium to participate or get locked out entirely so the time to partner and expand is now. 

Build vs. buy, revisited

This is where the age-old build vs. buy debate becomes unavoidable.

Yes, buying (or in this context, partnering) is faster and cheaper upfront. You get corridor coverage without the regulatory overhead, the banking relationships, the compliance burden. 

It's the rational short-term move.

On the other end, building has compounding advantages that partnerships can't replicate. 

When you own the infrastructure end to end, you control the user experience. You retain better unit economics. And critically, your ability to expand into adjacent use cases like payroll, treasury, trade settlements is dramatically higher. 

Building is expensive in the short run. There's no way around that. But over the long run, it's how you create a business that doesn't depend on someone else's willingness to keep the terms favorable.

The companies that will define stablecoin payments infrastructure over the next decade won't be the ones with the most liquidity. They'll be the ones who did the hard, boring, jurisdiction-level work early and own the rails when consolidation arrives.

Now, this is where the usual build vs buy argument gets tricky. 

Building and expanding your presence in a jurisdiction is no easy task. Understanding local regulations is the first step. This involves navigating the complex web of licensing requirements, ensuring rigorous compliance with anti-money laundering and data privacy standards, and the arduous process of building trust with local banking partners. 

Without these institutional foundations, any technical stack is effectively stranded. 

Ultimately, while liquidity is essential for grease in the wheels of commerce, it is merely the starting point rather than the ultimate measure of success for long-term infrastructure. 

To build a resilient global network, one must remember that liquidity matters, but it's certainly not the only thing that does.