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The Financial Stability Board published a report on crypto-assets, which considers work underway, regulatory approaches and potential gaps. The report is being delivered to G20 Finance Ministers and Central Bank Governors for their meeting in Fukuoka on 8-9 June.
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Hardly anyone is using Bitcoin for anything beyond speculation. Data from Chainalysis show that only 1.3% of economic transactions came from merchants in the first four months of 2019, little changed over the boom and bust cycles of the prior two years.
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The legislation amending the Payment Services Act and Financial Instruments and Exchange Act was formally enacted on May 31 and will take effect in April of next year. Among the notable changes, the Act will limit crypto-asset margin trading.
- Australian Securities Regulator Releases Cryptocurrency, Mining, ICO Guidelines
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The Australian Securities and Investment Commission (ASIC) published new initial coin offering (ICO) and cryptocurrency guidelines on its official website on May 30.
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The Congressional Research Service examined the decline in cash usage in the United States and the potential rise of alternative payment systems, including bitcoin or other digital assets, in the purchase of goods and services.
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SBI Ripple Asia is launching a store settlement service using the consumer-focused XRP-powered payments app MoneyTap, jointly developed by SBI and Ripple. MoneyTap implements Ripple’s blockchain solution xCurrent to enable near-instant domestic bank-to-bank remittance services.
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State Farm and USAA are testing a blockchain-based system to automate the time-consuming and paper-heavy processing of automobile claims. It runs on JP Morgan’s Quorum enterprise version of ethereum.
Month: May 2019
Kiffmeister’s Fintech Daily Digest 05/30/2019
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This Bank of Canada paper shows that when banks have no market power, issuing a deposit-like CBDC would would shift deposits away from the banking system, reducing bank lending. Otherwise, issuing a deposit-like CBDC with a proper interest rate would encourage banks to pay higher interest or offer better services to keep their customers, attracting more deposits and extending more loans. In fact, the CBDC would serve as an outside option for households, thus limiting banks’ market power, and improve the efficiency of bank intermediation.
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Grayscale Bitcoin Trust (GBTC) is now buying up about 21 percent of newly mined BTC monthly suggesting increasing demand from Wall Street.
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The crypto custodial service industry is booming. Institutional investors now have a way into the market and can pick from a multitude of solutions that allow them to secure crypto assets in a safe, secure, trusted, regulated way.
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European crypto firms are facing a double-pronged banking crisis. The handful of small, “crypto-friendly” banks are seemingly only friendly in name, accepting only a select-few firms, while “blockchain phobia” among mainstream banks continues. Many firms are now resorting to back-room deals or facing long, expensive delays to get banked via alternative institutionstags: CryptoAssets Fintech
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On-chain metrics suggest increasing use of the stable coin despite a decreasing circulating supply.
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The fake volume problem is getting worse. In the period from November 2018 to January 2019 BNC analysis identified 68% of reported market volume on the 240 exchanges it tracks as being suspect – up from 54% in the previous period.
Kiffmeister’s Fintech Daily Digest 05/29/2019
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The Central Bank of The Bahamas will enter into an official agreement with the executives of NZIA Ltd. for the design and implementation of Project Sand Dollar on May 30.
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Bundesbank President Jens Weidmann warned that widespread use of CBDC could have serious consequences. He said easy access to digital money could exacerbate bank runs in times of crises, leading to a faster collapse of lenders, and that even in good times it would fundamentally change the business model of banks.
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The Board of the International Organization of Securities Commissions is seeking comments on a consultation paper that describes the issues associated with crypto-asset trading platforms (CTPs) and sets forth key considerations to assist regulatory authorities in addressing these issues.
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A trial project using blockchain to transfer and settle securities and cash proved more costly and less speedy than the traditional way, Germany’s central bank president said.tags: Fintech Blockchain
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The Financial Stability Board published two reports as part of its work on work to assess and address correspondent banking declines.tags: Fintech CrossBorder
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An Aite Group report shows that the OTC market accounted for 60% of all crypto trades in 2018, up from 32% in 2016. Dark pool trading comprised 8% of volumes in 2018.
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American digital asset manager Grayscale announced that out of the firm’s $2.1 billion of assets under management, $1.97 billion resides in its bitcoin investment trust.
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The Dubai Land Department, the real estate arm of the Executive Council of Dubai, has partnered with UAE-based Mashreq Bank to release a blockchain-based mortgage platform.
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Several finance-related blockchain projects are progressing nicely, and trading technology firms are releasing products for professional traders aimed at the institutional crypto investment market. But blockchain and cryptocurrency technologies are far from crossing the chasm.tags: Fintech Blockchain
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After nearly two weeks of continuous voting, MakerDAO token holders have officially activated a decrease to DAI stablecoin fees. DAI is an ethereum-based token which presently maintains a soft peg to the U.S. dollar.
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TRON is a decentralized application platform and a blockchain-based operating system. The initial objective of this platform was to help resolve issues in the global entertainment sector. They later expanded the scope of their vision to tackle the whole DApps market.
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Silicon Valley fintech group Plaid has expanded to the UK as it seeks to capitalise on Britain’s push to open up banking. Plaid provides the technology for other financial technology companies to link to customers’ bank accounts via apps such as Venmo and Coinbase.tags: Fintech PaymentSystems
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This paper systematically explores and analyzes the stablecoin landscape, based on a survey of 24 specific stablecoin projects, extracting general concepts and approaches to build a comprehensive taxonomy of crypto-asset stabilization.
Kiffmeister’s Fintech Daily Digest 05/28/2019
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U.S payment startups are running headlong into a thicket of federal and fragmented state money transmitter regulations, resulting in large fees and often redundant compliance costs.tags: Fintech PaymentSystems
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JPMorgan Chase’s blockchain team has developed a privacy feature for ethereum-based blockchains, obscuring not only how much money is being sent but who is sending it.
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The FSB is developing a toolkit of effective practices relating to a financial institution’s response to, and recovery from, a cyber incident. The toolkit also aims to help supervisors and other relevant authorities in supporting financial institutions before, during and after a cyber incident.
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The Central Bank of Iran (CBI), via its Informatics and Services Corporation (ISC) and in conjunction with Areatak — a Tehran-based blockchain solutions provider — is developing a national blockchain project for its banking and financial sector.
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A new banking law drafted for the Central Bank of Egypt (CBE) would make it mandatory to obtain licenses in advance of creating, advertising or operating platforms for issuing or trading cryptocurrencies.
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VODACOM Tanzania in partnership with Amana Bank has launched a new M-Pesa mobile service dubbed “Halal Pesa” to reach out to the Muslim population who are excluded in the current mobile money services.tags: MobileMoney Fintech
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South Korean bank Shinhan is using blockchain technology to verify the items of proof required for credit lending, such as qualification or certification documents, to speed up loan approvals.tags: Fintech Blockchain
Kiffmeister’s Fintech Daily Digest 05/27/2019
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IEOs have raised more money than ICOs in 2019 — Ushering in a new era?
The total funds raised by IEO projects globally, since inception, stands at over $1.6 billion dollars with an overwhelming majority of these funds, ~1.4 billion being raised in 2019.
tags: Fintech CryptoAssets ICOs IEOs
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New correspondent banking data – the decline continues
The total number of active correspondent banking relationships and active corridors continues to decline. The year 2018 saw declines in active relationships and corridors of about 3.5% and 2%, respectively. Over the last seven years, active relationships in the global correspondent banking network have declined by about 20% and the number of active corridors has fallen by roughly 10%.
tags: Fintech CrossBorder
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Institutional volume pops as professional investors opt for Bitcoin
Bitcoin is on track to post its second-highest quarterly gain since 2014. With custodial solutions, exchanges, and institutional trading platforms all reporting an uptick in volume, has institutional capital arrived?
tags: Bitcoin Fintech CryptoAssets
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The last mile problem: Understanding the economics affecting the future of Blockchain
At the interface between the digital (online) and physical (offline) world, the usefulness of Blockchain technology depends on intermediaries to effectively bridge “the last mile” between a digital record and physical assets, businesses, devices or events.
tags: Blockchain Tokenization Fintech
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Blockchain Development: Lack of Transparency on What Works and Doesn’t
Blockchain firms supporting development pilots are not practicing what they preach — improving transparency — by sharing data and lessons learned about what is working, what isn’t working, and why.
tags: Blockchain Fintech
Kiffmeister’s Fintech Daily Digest 05/26/2019
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Two bitcoin cash mining pools carried out a 51% attack on the blockchain in an effort to reverse another miner’s transactions aimed at taking coins that they weren’t supposed to have access to in the wake of the May 15 BCH network hard fork.
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In its terms of service, Tether says it “reserves the right to delay redemption or withdrawal” of tether in the event of illiquidity. The company also says that it reserves the right to pay you “in-kind redemption of securities and other assets” held in its reserves.
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Whatever happened to Woolf University’s plan to provide higher education on the blockchain, with everyone paying and getting paid in WOOLF tokens? Woolf’s home page is now devoid of the word “blockchain” and the ICO white paper and info on the token sale have also disappeared…
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Microsoft’s Project ION (Identity Overlay Network) will allow users to mint decentralized digital identities, which aim to act as an immutable replacement for email addresses and usernames, and potentially a vault for sensitive personal data. These identities will be used to seamlessly access online applications without the need to indiscriminately surrender personal data. They could also be used in real-life applications by allowing doctors to cryptographically verify the medical details of patients, or university students to verify their qualifications. To scale to the capacity needed, Microsoft has built Project ION as a Layer 2 network, similar to Lightning but with no tokens and no signatories. Using the underlying protocol Sidetree, ION batches transactions and anchors them with a single hash, increasing efficiency and pushing fees down to what would be just a “rounding error” to Microsoft.
Kiffmeister’s Fintech Daily Digest 05/25/2019
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As more people and places say ‘No’ to cash, apps like Venmo and Zelle are emerging as the new dominant payment methods in the United States.tags: Fintech MobileMoney
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If you are a gift-giving foundation, foreign ministry or development advisor, could sending your aid via Bitcoin be a better way? Bitcoin’s peer-to-peer digital payments network could be the future of humanitarian aid.
Kiffmeister’s Fintech Daily Digest 05/24/2019
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Facebook plans to test its GlobalCoin crypto-currency and digital payments system by the end of 2019 and launch in about a dozen countries by Q1 2020. Facebook is expected to outline plans in more detail this summer, and has already spoken to Bank of England governor Mark Carney and US Treasury officials about operational and regulatory issues. The firm is also in talks with money transfer firms including Western Union.
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A year and a half after cryptocurrency investors started touting the benefits of turning traditional investments into digital “security tokens,” progress has stalled.
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BitPay supports settlement in 12 currencies and direct bank deposit in 37 countries. Cryptocurrency settlements are supported in over 200 countries. Cryptocurrency – Bitcoin (BTC), Bitcoin Cash (BCH), Gemini Dollars (GUSD), Paxos (PAX), and Circle USD Coin (USDC)
Kiffmeister’s Fintech Daily Digest 05/23/2019
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AT&T will now accept online bill payments through crypto payment processor. AT&T becomes the first major U.S. mobile carrier to provide a crypto payment option to customers. However, it looks like they only accept Bitcoin. Pity…tags: Fintech CryptoAssets
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The Bank of Russia will review a proposal to create a gold-backed cryptocurrency, which could be used for mutual settlements with other countries, Governor of the Bank of Russia Elvira Nabiullina said on May 23. More: http://tass.com/economy/1059727″
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Mastercard has introduced its Innovation Engine, an API based plug-and-play digital platform that enables issuers and merchants a simplified path to rapidly deploying digital capabilities and experiences to their customers. It will deliver unique and digitally integrated solutions and consumer experiences through a single connection.
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Suncorp ran Watson silently alongside its consultants for six months, with the AI returning the most accurate insurance claims assessments.
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This paper analyzes cyber risk from an operational risk perspective and measures it empirically, using a novel data set on cyber attacks. It analyzes the main cyber attack characteristics and identifies patterns using correspondence analysis.
Kiffmeister’s Fintech Daily Digest 05/22/2019
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Ripple Escrow Reporting: Creative Accounting or Much Ado About Nothing?
Coin Metrics has released a report detailing discrepancies in Ripple’s escrow reporting system. The Blockchain analysis firm described these discrepancies as contradictions that required some explanation.
tags: CryptoAssets AltCoins Fintech Ripple
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Coinbase Now Lets Merchants Accept Payments in USDC Stablecoin
Coinbase Commerce, the crypto exchange’s zero transaction fee merchants payments offering, has added support USD Coin. Merchants can accept It without geographical limitations or the need for a traditional bank account.
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Blockchain Credit Union Consortium to Use R3’s Corda for Cross-Border Payments Product
CULedger, a blockchain consortium and credit union service organization, has chosen enterprise software firm R3’s Corda blockchain to underpin its forthcoming cross-border payments product.
tags: Fintech Blockchain R3 Corda CrossBorder
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Outstanding Stablecoins, Spot Trading Volumes Hit Record
Stablecoins have hit an all-time high with over $4B USD-pegged tokens now on the blockchain. While Tether dominance remains, new stablecoins that came to market recently have made leapfrogs of progress.
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Crypto Lending Startup BlockFi Slashing Interest Rates on Ether Deposits
Cryptocurrency lending startup BlockFi is almost halving the interest rates it offers on ether (ETH) deposits, while some bitcoin (BTC) rates will increase slightly.
tags: Fintech CryptoAssets Collateral
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The Bitstamp ‘flash crash’ – why robust indices matter
Around 11PM EST on May 16th, a sell order for around 5,000 BTC appeared on the Bitstamp order book. Over the next 15 minutes, the BTC price on Bitstamp continuously fell – skewing the entire market and triggering hundreds of millions in long liquidations.
tags: Fintech CryptoAssets Bitcoin Liquidity
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Study: Bitcoin Derivatives Exchanges Register Record Trading Volumes
Cryptocurrency research firm Diar has indicated that institutional traders recently registered record high volumes on bitcoin (BTC) derivatives exchanges.
tags: Bitcoin CryptoAssets Futures Fintech
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Tencent-Backed Waterdrop Seeks Valuation of More Than $1 Billion
Beijing startup Waterdrop, backed by social media giant Tencent, is seeking new financing at a valuation of more than $1B to fend off its better-capitalized rival, Ant Financial, in the emerging field of health care crowdfunding.
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Binance Research Report on the Evolution of Stablecoins
How are fiat-backed stablecoins adapting their strategies to remain competitive?
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Crypto Startup Circle Lays Off 30 Employees Citing Market, Regulatory Conditions
Crypto startup Circle has laid off roughly 30 people, or about 10% of its staff. The company – which owns the USDC stablecoin in partnership with Coinbase – is looking to cut costs.
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Tether admits in court to investing some of its reserves in bitcoin
In a court transcript Tether admits that it invested some of its reserves in bitcoin. David Miller, an attorney for Bitfinex said: “Tether actually did invest in instruments beyond cash and cash equivalents, including bitcoin.”
tags: Fintech CryptoAssets AltCoins Bitcoin Tether Stablecoins
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Japanese Parliament Moves New Crypto Regulations to the Upper House
The Japanese House of Representatives has passed new crypto regulation in the upper house of the National Diet. The amendments to two of Japan’s financial laws include adding crypto-asset margin trading.
tags: Fintech CryptoAssets Regulation