Jared Isaacman, Trump's pick for NASA, made a big bet on stablecoins with Shift4

President-elect Donald Trump's pick to run NASA is Jared Isaacman, 41, a space enthusiast who just months ago led the world's first all-civilian mission to reach orbit.

He is also a fintech billionaire.

Isaacman is the founder Transformation4a fintech company that provides secure payment processing solutions for businesses. The company's stock price has jumped nearly 40% this year, raising its market value to $9.3 billion. Isaacman started the business in 1999 when he was 16, and went public on the New York Stock Exchange in 2020.

In a Dec. 4 post on his Truth Social platform announcing the selection, Trump wrote: “Jared has demonstrated exceptional leadership and built a leading global financial technology company.”

This success can be attributed in part to a bold bet on cryptocurrencies nearly three years ago.

Inside Isaacman's New York residence near Central Park, around a soaring, glass-walled conference room located above the apartment's living area, Isaacman and members of his executive team sat with Alex Wilson and Pat Duffy, two entrepreneurs who were in the final stages of selling a private cryptocurrency donation market. them to Shift4. That was early 2022.

With a whiteboard behind them, they talked about how blockchain-based technology is being applied across the payment company's business.

Bitcoin It set a record a few months ago, jumping six-fold from the end of 2019 to the end of 2021. A group of digital tokens were generating huge returns. The market was frothy, spirits were high and coinage was at its peak.

But while Elon Musk was promoting Dogecoin and money was flowing into non-fungible tokens, or NFTs, Wilson, Duffy and Isaacman focused on a far less glamorous corner of the digital asset world: stablecoins.

Stablecoins are a subset of cryptocurrencies that are identical to the value of real assets and are virtually synonymous with tokens pegged to the US dollar. Today, their total value is about $200 billion, and they are often used to move money across borders at a fraction of the cost of legacy payment systems.

The group around the table at Isaacman's house “all agreed that stablecoins are more likely to become a regular medium of exchange than bitcoin or ethereum,” said Wilson, 31. They wanted to build products that leveraged blockchain technology but were code-agnostic.

“We wanted to meet users where they are and equip our merchants to receive payments any way their customers want to pay,” Wilson said.

In front of a whiteboard with a marker in hand, Isaacman explained the ways in which cryptocurrencies can be applied to Shift4's broader business. Wilson said Isaacman has an uncanny ability to overcome obstacles despite being CEO of a company that now has more than 3,000 employees.

Weeks later, on March 1, Shift4 announced that it had acquired The Giving Block, Wilson and Duffy, and would pursue a “$45+ billion inline sales opportunity by bundling cryptocurrency donation capabilities with traditional card acceptance.” Shift4 paid $54 million and included in the deal potential earnings of up to $246 million.

Duffy and Wilson now lead the cryptocurrency team at Shift4. In October, they announced a cryptocurrency payment service that would be rolled out to all of the platform's 200,000 merchants, making it possible to spend cryptocurrencies at hotels, restaurants, and stadiums.

“This is the biggest step toward crypto payments ever becoming mainstream in the industry,” Wilson said.

Isaacman told CNBC in a statement that he is excited to see the original vision he discussed with Wilson and Duffy during the acquisition “come to life at a time when cryptocurrencies are becoming increasingly mainstream and gathering real momentum.”

Isaacman finds himself in the middle of the action.

The cryptocurrency market, which was already hot, has seen an even more dramatic rebound since Trump's election win in November, which came alongside congressional victories for pro-crypto candidates. Bitcoin surpassed $108,000 on Tuesday for the first time, up more than 55% since election night, and the token's total market value has risen to more than $3.7 trillion.

More institutional and retail investors have also jumped in, thanks to an influx of bitcoin exchange-traded funds that hit the market starting in January along with other options products that offer a new way to bet on the future price of bitcoin.

Stablecoins have moved closer to going mainstream as well.

In October, Stripe agreed to pay $1.1 billion for Bridge Network, a stablecoin platform that attempts to make business transactions using digital currencies easier for businesses. The deal was a huge wake-up call for traditional credit card companies.

Visa and MasterCard It currently dominates payments in the US, accounting for 80% of all US credit card volume, according to Nielsen Report data. Credit card networks charge payment processors like Stripe a transaction fee for using so-called rails. Costs, which include a fixed fee plus a percentage of each payment that can be as high as 3.30% American Expressis generally passed on to the client.

But with stablecoins, transactions can cost as little as a penny and are almost instantaneous. Stablecoins are great for cross-border transactions, which is important for almost all of the company's users, says Emily Sands, technical lead for Stripe's data science team.

“This is very valuable to the Stripe ecosystem,” Sands said. “It's not just the card network. It's not just local payment methods. It can also apply to cryptocurrencies.”

Blockchain-based payments company Ripple just launched its stablecoin RLUSD, and cryptocurrency custodian BitGo is planning to follow. Robinhood British fintech Revolut is said to be considering similar steps.

PayPal PYUSD was relatively early to the market, launching a currency pegged to the US dollar called PYUSD in August 2023. PYUSD's market cap topped $1 billion this summer but has since fallen below $500 million as competition for market share intensifies.

Tether's USDT and Circle's USDC are the dominant stablecoins, with $140 billion and $42 billion in supply, respectively, representing about 90% of the combined market.

Given their growing popularity, experts are eagerly waiting to see how major credit card companies respond and whether they will issue their own coins.

In October, Visa announced the Visa Tokenized Asset Platform (VTAP) to make it easier for banks to launch their own stablecoins. The offering allows banks to issue and manage tokens backed by fiat currencies, said Coy Sheffield, head of crypto at Visa.

Visa is “working to bring a lot of these capabilities to them,” Sheffield said.

In July last year, Mastercard unveiled its Multi-Token Network (MTN), which facilitates the payment of fully collateralized stablecoins as well as other digital assets via the platform.

Raj Damodharan, head of cryptocurrency and blockchain at Mastercard, told CNBC that MTN is looking to bring crypto capabilities, including the ability to program digital money, to banks, which hold trillions of dollars in dollar deposits.

But stablecoin issuers have faced their share of challenges. TerraUSD, or UST, and the Luna token collapsed during the cryptocurrency crash of 2022, losing billions of dollars in value and eroding confidence in the reserves that back some stablecoins.

More recently, the Wall Street Journal reported in October that the Justice Department was looking into the Tether case for possible violations of sanctions and anti-money laundering rules. A Tether spokesperson said at the time that the story was “based on pure speculation” and that it had “no knowledge of any such investigations.”

As more established financial players participate, the market gains broader credibility.

Ari Redbord, global head of policy at blockchain intelligence firm TRM Labs, said stablecoins are the bridge between the cryptocurrency ecosystem and the traditional financial system.

“That's why you see the leading fintech companies — Stripe, PayPal, Visa and others — really leaning into using stablecoins,” Redbord said.

The cryptocurrency industry has lobbied lawmakers on Capitol Hill for years about stablecoin legislation that would provide safeguards for these dollar-denominated digital assets and the companies that issue them. Coinbase Founder and CEO Brian Armstrong, one of the industry's loudest voices in Washington, told CNBC in September that the company had seen a lot of interest in stablecoins.

“Cryptocurrencies started out really focused on trading, and have now made a big shift towards utility, specifically payments,” Armstrong said. Stablecoins reached $10 trillion last year, he said, and that number could double or triple this year, “so it's been a huge growth story for cryptocurrencies as people start thinking about how to make the dollar faster, cheaper and more global.”

At Shift4, growth has continued through acquisition. The company has bought German point-of-sale company Vectron Systems, the UK's Card Industry Professionals, Canada's Eigen Payments and other payment companies in recent years.

Wilson said the company views stablecoins in the context of two different target markets. One group consists of people who have become rich in cryptocurrencies and want to use their token dollars to “rent a plane or a helicopter,” he said. The other includes those living in Latin America and Africa, “where people only want to spend stablecoins for everyday payments because adoption of Visa and MasterCard is low,” he said.

A survey conducted by Castle Island Ventures, Visa, and other partners showed that stablecoins represent an important part of economies in emerging markets like Nigeria. In countries “facing severe liquidity crises,” stablecoins allow “individuals and businesses to access international payments in US dollars without the hard currency having to leave the country,” the report said.

Standard Chartered Bank wrote in a recent report that stablecoins currently equate to 1% of financial transactions in the United States and a similar percentage of foreign exchange transactions. As they gain legitimacy, a move to 10% would be “possible,” the bank said.

As Shift4 tries to position itself at the forefront of what it hopes will be a continuing wave of stablecoin momentum, Isaacman is turning to the public sector.

In addition to his career in finance, Isaacman has led two private spaceflights for SpaceX, in 2021 and 2024, leading crews on multi-day journeys around the Earth. His spaceflight ambitions have fostered an increasingly close relationship with SpaceX CEO Musk, who has become one of Trump's biggest backers and is expected to have a senior role in the administration.

On December 4, Isaacman wrote a letter addressed to the “Shift4 Family,” telling investors and employees that until he was confirmed by the Senate, he would remain CEO.

“Shift4 has been my life’s work since I was 16,” wrote Isaacman, who dropped out of school and built the company from his parents’ basement. “But this is my time to serve and give back to the nation that enabled me to live the American dream.”

Isaacman said his selection to lead NASA “reflects my passion for advancing humanity's reach to the stars, unlocking the secrets of the universe, and improving life on Earth along the way.”

Wilson recalled having dinner with Issacman in March 2022 after The Giving Block deal closed. They were in Las Vegas, and Isaacman brought Wilson and Duffy to an Italian restaurant called Lago in the Bellagio Hotel on the eve of the announcement. Wilson remembers discussing what it was like when Isaacman started his business as a teenager.

“No one cares and works harder than the founder, and it really shows with Jared,” Wilson said.