Entry is Revenue, Is YouTube Turning into a Neobank?

Original Title: Youtube Is the Next Neobank

Original Author: Caleb Shack

Translation: Peggy, BlockBeats

Editor's Note: Over the past decade, the rise of neobanks has followed a clear path: starting from a "local gap" in fees, pricing, or experience, establishing an advantage in a single scenario, and then gradually expanding into full financial services. However, after the rapid commodification of infrastructure driven by stablecoins, this path is now failing as the account itself is no longer scarce, and the deposit layer no longer has a moat.

This article points out that the new competitive starting point has shifted from "product design" to "revenue source." When a platform can control users' cash flow, growth trajectory, and behavioral data, financial services no longer need to exist independently but become an intrinsic part of the platform. From YouTube and Uber to TikTok, these platforms that control "revenue distribution rights" are gaining the ability to reshape banking relationships.

In this logic, a neobank is no longer a form of institution but rather an embedded function. What truly determines success is not who can offer a cheaper account but who controls where the user's "money comes from."

The following is the original text:

Almost every successful new-age digital bank (neobank) has had a nearly identical starting point: identifying a part of the traditional banking system where users were overcharged or underserved, using this as a wedge to enter the market, and then gradually expanding into more comprehensive banking services.

SoFi realized that using FICO credit scores to price student loans was not reasonable for borrowers with higher potential. So, they switched to evaluating creditworthiness based on income growth paths and free cash flow, and as data accumulated, this capability gradually built a true moat. Monzo, Revolut, and Starling entered the market by offering zero foreign exchange fees—at that time, most banks would charge around 3% in fees when users swiped cards abroad. Nubank, on the other hand, won the Brazilian market with its "zero-fee credit card" when traditional banks not only had high fees but also millions of people didn't even have a bank account.

The path has always been similar: find that "wedge," win in a narrow scenario, and then expand to full-service.

Today, with the emergence of stablecoins, providing checking and savings accounts has never been easier. The infrastructure is almost entirely commoditized. This has led to a wave of stablecoin neobank startups, but most of them lack true differentiation. It is precisely this "easy" nature that allows them to quickly emerge and also means that the next wave of competitors can easily keep up. In the pure "deposit layer," there is almost no moat.

The reason why the first generation of fintech companies was successful was largely because they built differentiated products on top of an already commoditized "distribution layer" (the internet), thereby gaining an advantage over traditional banks. And when the infrastructure is commoditized, a new path is opened: creating new products through "bundling." Lowering the barrier to creating accounts will not result in thousands of independent neobanks but will instead make "banking services" an embedded capability integrated into platforms that already control more critical resources—namely, "sources of revenue."

If you are a creator earning money on YouTube or Twitch, your relationship with these platforms is much deeper and more data-dense than your relationship with a bank like JPMorgan Chase. Platforms have real-time visibility into your cash flow, understand your growth trajectory, and grasp the platform's algorithmic logic. They can extend credit to you in ways that traditional banks find challenging. This logic also applies to gig platforms like Uber and Lyft, social commerce platforms like Whop and TikTok, and modern payroll service providers like Deel and Gusto.

The logic of bundling creator income with financial services is actually quite simple: once a creator's income, GMV generated on ecommerce platforms, and company payroll sent through ACH transfers are completed, they immediately "flow out" of the platform. Just YouTube alone has paid creators over $100 billion since 2021 and started supporting stablecoin payments in December last year. Whop has generated over $40 billion in GMV and is starting to expand into the crypto financial services vertical. Now, with just a few lines of code, you can earn transaction fees and Treasury bill yield during the payment process, allowing platforms to embed these services, even engage in lending based on existing data, almost as a "matter of course."

These companies do not need to be "banks" in a regulatory sense. What they need to do is provide "Banking as a Service"—accounts, payment cards, loans—and all of this is built on the data they have already generated. The real "entrypoint" is no longer some product trick or price arbitrage but the "revenue relationship" itself.

The next neobank is likely to be YouTube. Not because YouTube will apply for a banking license, but because the "platform where you earn your income" is naturally the most suitable starting point for financial services.

[Original Article Link]