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“A wider use of new types of crypto-assets for retail payment purposes would warrant close scrutiny by authorities to ensure that that they are subject to high standards of regulation. The FSB and standard-setting bodies will monitor risks very closely and in a coordinated fashion, and consider additional multilateral responses as needed.”
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François Villeroy de Galhau has announced the launch of a G7 task force that will investigate the impact of stablecoins. It will investigate issues such as the definition of “stable”, what constitutes a stable basket, and whether peg has to be fully fixed or flexible. It will also examine issues related to anti-money laundering, consumer protection and operational resilience, plus any possible impact on the transmission of monetary policy. De Galhau added it would be important to improve existing payment systems, especially where they operate across borders.
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The Financial Services Committee will hold a hearing on Facebook’s Project Libra on July 17. The Senate Banking Committee will hold its own hearing on the social media giant’s crypto project the previous day.
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Thomas Moser, alternate member of the Swiss National Bank governing board, suggested that Facebook’s recently announced cryptocurrency project, Libra, is not ruffling any feathers with the regulator (“I think it’s an interesting development and I’m pretty relaxed about it”).
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Libra’s main stated mission is to service the world’s poor and unbanked. Facebook’s source for the 1.7 billion figure is the World Bank’s Global Findex Database 2017. Findex also believes that 1 billion of these have mobile phones and 500 million have internet access. However, Findex also says that over half of the 1.7 billion come from just seven countries: Bangladesh, China, India, Indonesia, Mexico, Nigeria and Pakistan. More than half of these are in places where cryptos are banned, Facebook can’t freely operate, the country is under heavy FATF restrictions, or it faces other limitations.
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Fitch ratings believes that Libra represents a step toward a potentially viable cryptocurrency. It incorporates and improves upon elements of existing blockchain technology, while resolving certain inherent drawbacks, such as price instability and governance challenges. Libra also seems to be designed with regulatory acceptance and lawfulness in mind.
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Economist Stephen Moore, who recently lost out on a bid to join the board of the Federal Reserve, is joining the “Decentral” algorithmic stablecoin team. Decentral bills itself as “the world’s decentralized central bank.”
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La Banque de la République d’Haiti is considering a pilot to create a digital version of the Haitian Gourde, aiming to improve the domestic payments system and promote financial inclusion in Haiti.
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JPMorgan Chase is to start trials of its “JPM Coin” cryptocurrency in conjunction with corporate clients.
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The U.S. SEC is kicking off the public comment period for an exchange-traded fund (ETF) backed by bitcoin and Treasury bills proposed by Wilshire Phoenix Funds to be listed on the NYSE Arca exchange.
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The U.S. CFTC has cleared LedgerX to offer physically settled bitcoin futures contracts. Unlike the cash-settled futures listed by the CME, when the contract expires, the buyer will receive bitcoin rather than the fiat equivalent.
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While there have been incredibly successful crypto projects that have leveraged either a capped or uncapped sale, several prominent crypto projects such as the Algorand Foundation are turning to a Dutch Auction for their token distribution with the hopes of bringing more transparency to the process.
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This book addresses core components of crypto-assets within the Maqasid al-Shari’ah to understand Shari’ah cryptocurrency and its practical mechanisms, and establishes a Halal alternative model of crypto-asset management within the Maqasid al-Shari’ah.
