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Senator Brian Schatz, a Democrat from Hawaii, may offer legislation that would have the effect of making currencies such as Libra illegal, according to a draft of the bill reviewed by Bloomberg. The legislation would amend a U.S. statute originally meant to prevent Americans from minting their own physical currencies. The amendment would also make it illegal for someone to create a digital currency, intended to be used as money, whose value is based on assets held in reserve.
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“If Libra comes to be treated as a tokenized security representing ownership of a money market fund, that could set the project back.”
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Bitfinex shareholder and over-the-counter (OTC) trader Zhao Dong has revealed that Tether is planning to launch a cryptocurrency backed by the Chinese renminbi.
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“Louis Brandeis said of the early-20th-century trusts that “both the financial concentration and the combinations which they have served were, in the main, against the public interest.” Big banks and big tech may rely on fancy algorithms and apps instead of railroads, but his words are just as true today.”
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“Private digital currencies improve welfare within an emerging market with a selfish government [by disciplining] monetary policy by creating an alternative to local fiat. That monetary policy discipline reduces inflation and results in higher returns from investment which in turn encourages higher local investment.”
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Stablecoins Vulnerable to Regulatory Uncertainty: European Central Bank “Less innovative stablecoins could provide a solution to users Seeking a stable store of value, especially if legitimised by the adherence to standards that are typical of payment services, the jury is still out on the potential future role of more innovative stablecoins outside their core user base.”
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Telegram’s new blockchain project will be compatible with ethereum, according to a tech startup building tools for the network. The messaging company is expected to release the code to run a node on the Telegram Open Network (TON) on September 1, allowing users to trial its project in advance of the project’s expected mainnet launch on Oct. 31.
Month: August 2019
Kiffmeister’s Fintech Daily Digest 08/30/2019
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CME Bitcoin Futures Trading Breaks Record, Averaging $370 Million Per Day
Interest in Bitcoin futures trading continues to gain momentum. As a result, the Chicago Mercantile Exchange (CME) Group is reaching record numbers for its Bitcoin futures contracts trading.
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Binance’s Venus will Face the Same Challenges as Facebook’s Libra, says Crypto Researcher
Binance announced that it is looking for partners to create the stablecoin that will be pegged against a basket of government-issued currencies.
tags: CryptoAssets Binance Stablecoins Fintech Facebook AltCoins
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Binance: Venus Project Will Court Regulators, Avoid Facebook’s Mistakes
Binance co-founder He Yi claimed that the company will engage with regulators from day one regarding its Venus stablecoin project. He also confirmed previous rumors that Venus will be primarily geared towards non-Western countries.
tags: Fintech CryptoAssets AltCoins Stablecoins Facebook Binance Regulation
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Telegram to release its cryptocurrency by October 31
Gram digital wallets will be made available to Telegram’s 200-300 million global users, and Grams will make it possible to buy and sell other goods on Telegram.
Kiffmeister’s Fintech Daily Digest 08/29/2019
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First Look: China’s Central Bank Digital Currency
China’s digital currency will most likely be a two-tiered system. The first tier will connect the PBOC with commercial banks for currency issuance and redemption. The second layer will connect those commercial banks with the greater retail market.
tags: CryptoAssets CBDC Fintech AltCoins
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Libra: The known unknowns and unknown unknowns | Eichengreen
“Libra remains a work in progress. Its designers continue to dribble out information about its structure and governance. But their documentation raises as many questions as it answers.”
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Libra: A dramatic call to regulatory action
Facebook’s proposed creation of Libra is a wake-up call. It makes inescapable the need for rapid, international coordination of financial regulation. Without mechanisms to ensure consistent application of coherent global rules, we may find ourselves in a world of “low-quality finance havens” that exist to evade financial regulations—not unlike the “tax havens” that already exist merely to evade taxes.
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The benefits of a global digital currency
“The overall risk of holding a global currency [like Libra] may not be large for plausible exchange rate volatility and risk aversion [but] the potential gain in lowering transaction costs in retail cross-border payments and local payments are large.”
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Whether central banks adopt CBDC at all is another matter and will result from carefully weighing pros and cons. But to the extent central banks wish to offer a digital alternative to cash, they should consider sCBDC as a potentially attractive option.
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US Banking Giant PNC Starts Using RippleNet for Cross-Border Payments
PNC — the United States’ eighth-largest bank, with almost $400 billion in assets — has become the country’s first to start using the RippleNet blockchain network for cross-border payments.
tags: Fintech Ripple CrossBorder Blockchain
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Chinese Central Bank ‘Crypto’ Not Launching in November: State Media
The Global Times claims that China’s central bank has refuted recent reports of its plans to launch a state-backed cryptocurrency this November. The Global Times is China’s national English language tabloid, under the People’s Daily — the official newspaper of the Communist Party of China (CPC).
tags: AltCoins Fintech CryptoAssets CBDC
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Fintech Firm Partners With R3 to Develop Shariah-Compliant Market Platform
Dubai-based fintech company Wethaq has entered into a strategic partnership with enterprise software firm R3, in order to create a platform for issuing and trading sukuk securities based on R3’s Corda offering.
tags: Blockchain Corda IslamicFinance Fintech R3
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Monetary Stabilization in Cryptocurrencies – Design Approaches and Open Questions
Based on a survey of 24 specific stablecoin projects, we go beyond individual coins for extracting general concepts and approaches. We combine our findings with learnings from classical monetary policy, resulting in a comprehensive taxonomy of cryptocurrency stabilization.
Kiffmeister’s Fintech Daily Digest 08/28/2019
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Bakkt Clients Can Start Warehouse Deposits on Sept. 6
Crypto trading platform Bakkt’s Bakkt Warehouse will begin offering storage of customer’s Bitcoin on September 6, weeks before the scheduled launch of its platform for daily and monthly crypto futures in the United States on Sept. 23.
tags: Fintech CryptoAssets Bitcoin Futures Custody
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Carstens warns of ‘serious consequences’ from retail CBDC
The Bank for International Settlements’ Agustín Carstens has expressed concern over the use of retail central bank digital currencies (CBDC), suggesting a wholesale option might be a better approach.
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Results of the SNB Survey on Digitalisation and Fintech at Swiss Banks
In the longer term, Swiss banks envisage themselves continuing to play a central role in financial intermediation, albeit amid heightened competition and significant digitalisation of financial services. In certain segments, such as payments and corporate lending, bigtechs and digital banks could emerge as important competitors for banks. By contrast, fintechs are seen more as partners given their modest size and specialised focus. At the strategic level, the banks are seeking to bring their existing business models to a high level of digital maturity with the aim of cutting costs and retaining their attractiveness to customers
tags: Fintech
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Process Improvement and Blockchain: A Payments Example
This ‘lost payments’ problem was the problem we set out to solve when we built the Corda Settler. And I was reminded about this when I overheard some colleagues discussing it the other day. One of them wondered why we don’t include the recipient of a payment in the set of parties that must agree that a payment has actually been made. Isn’t that kinda a bit of an oversight?!
tags: Blockchain Plumbing R3 Fintech Corda
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Alibaba, Tencent, Five Others To Receive First Chinese Government Cryptocurrency
China’s central bank will launch a state-backed cryptocurrency and issue it to seven institutions in the coming months, according to a former employee of one of the institutions who is now an independent researcher.
tags: Fintech AltCoins CryptoAssets CBDC
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Telegram Pushes Ahead With Plans for ‘Gram’ Cryptocurrency
Telegram has said the new digital money will operate with a decentralized structure similar to Bitcoin, so that Telegram will have no control over how and where the coins can move.
tags: Facebook Fintech Stablecoins CryptoAssets AltCoins Telegram
Kiffmeister’s Fintech Daily Digest 08/27/2019
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The SDR—a blueprint for libra?
The SDR—a blueprint for libra? The SDR’s history and limited success show how difficult it is to design an international currency. Libra will likely face very similar challenges.
tags: Fintech Facebook AltCoins CryptoAssets Stablecoins SDR
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Coinbase-backed trading data provider Nomics finds that around 17% of bitcoin (BTC) trading volumes are trustworthy, while for ether (ETH), that number is 8%.
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Central Bank Of Brazil Adopts IMF Crypto Classification Guidelines; Labeled ‘Non-Financial Product’
The IMF Balance of Payments Statistics Committee recommended classifying the buying and selling of crypto-assets as assets produced, which means that it is compiled into the balance of payments asset account.
tags: CryptoAssets Fintech Accounting
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SEC Chief’s Crypto Leeriness Sets Up Facebook Clash on Libra
Though SEC Chair Clayton avoided commenting directly on Libra, he noted that if something looks like an ETF and operates like an ETF, the law says it should be regulated like an ETF. That holds true no matter what it’s called, Clayton added.
tags: Fintech Facebook CryptoAssets Regulation Stablecoins AltCoins
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Ethereum ‘Almost Full’ as Controversial Coin Gobbles Up Capacity
The digital ledger behind the supposed better version of Bitcoin is running out of capacity. That was the warning last week from Ethereum co-founder Vitalik Buterin, who noted that the cost of processing transactions done in the digital token Ether on the underlying blockchain may get too expensive for some users.
tags: Fintech CryptoAssets AltCoins Ethereum
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Libra Cryptocurrency: Can Facebook Dominate in Money Transfers?
Karl Schamotta, chief market strategist at Cambridge Global Payments, said even though Facebook’s Libra would be a unified currency, “each country in the world has idiosyncratic regulatory regimes, fragmented banking standards, and a whole lot of things that throw sand in the gears that prevents the smooth transfer of money.”
tags: AltCoins CryptoAssets Facebook Fintech CrossBorder Stablecoins
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Chainalysis: Most Mixed Bitcoin Not Used for Illicit Purposes
If Chainalysis is right, only a small fraction of coins sent to and from bitcoin mixers are used for illicit purposes.
tags: Fintech CryptoAssets Bitcoin AMLCFT
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A Look Behind the Technology Gameplan of China’s Insurtech Giant, ZhongAn
By harnessing the latest technologies, ZhongAn Online continues to integrate technology into every process in the insurance sector so as to reshape the entire insurance value chain.
Kiffmeister’s Fintech Daily Digest 08/26/2019
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Peer-to-peer industry faces harsh reality when winter comes
A slick digital platform, as it turns out, is not enough. Lenders and borrowers need to be found — and finding them is difficult. On the lending side, there were not enough individuals out there willing to put their money at risk in someone else’s small business or credit card consolidation loan.
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Australian Securities Exchange Confirms It’ll Go Blockchain in 2021
The ASX confirmed its anticipation of delivering the CHESS replacement system by 2021, following a new agreement with NYSE-listed tech firm VMware and Digital Asset Holding (DA).
tags: Fintech Blockchain
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“Binance Lending” will allow holders of BNB token, Ethereum classic and Tether to earn interest on their funds. The maximum cap per account is initially set at 500 BNB and 1,000,000 USDT respectively.
tags: Fintech CryptoAssets Collateral
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ASX Ties with VMware for Its Blockchain-Based Settlement System
The Australian Securities Exchange has signed a memorandum of understanding (MoU) with Digital Asset and VMware to boost the development of its blockchain-based equities clearing and settlement system.
tags: Fintech Blockchain
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FINMA Grants License to Two New Crypto Banks
For the first time, FINMA has issued banking and securities dealers’ licences to two pure-play blockchain service providers – SEBA Crypto AG and Sygnum AG, which will offer services for institutional and professional customers.
tags: Fintech Blockchain Regulation
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Swiss Regulator Releases AML/KYC Guidance for Blockchain Payments
Switzerland’s Financial Market Supervisory Authority has released guidance on regulatory requirements for payments on the blockchain under FINMA supervision, to adher to the FATF framework for digital asset regulation issued in June.
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Banks in China Are Increasingly Partnering with BigTechs
According to an analysis by Chinabankingnews.com, at least ten commercial banks in China have inked partnership deals with tech or fintech companies since the beginning of the year.
tags: Fintech
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Libra Association members refuse to public support Facebook’s cryptocurrency plan
Most of Libra’s founding members are refusing to publicly support it. Mastercard, Uber, and PayPal are ignoring inquiries as to whether they are still committed to Libra. Only two of them agreed to answer questions from Business Insider about their support.
Kiffmeister’s Fintech Daily Digest 08/25/2019
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“Last week, the United States Internal Revenue Service sent another round of letters to crypto traders called CP2000. These notices were sent to traders of some crypto exchanges due to inconsistencies found in their tax reports.”
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Tether is to stablecoins what Bitcoin is to altcoins, but whereas bitcoin’s dominance stands at 62%, Tether is capturing 98% of all stablecoin volume, despite the numerous, and some say more trustworthy, alternatives.
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Binance Charity Foundation has introduced Pink Care Token, a blockchain-powered stablecoin pegged to one year’s supply of sanitary pads, “empowering women in underdeveloped countries to improve overall health and well-being.”
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On Aug. 16, the BaFin published a leaflet for issuers of crypto tokens that summarized current German legal standards in the field. By condensing active regulations in such a fashion, the BaFin reportedly hopes to encourage compliance among a new wave of ICOs.
Kiffmeister’s Fintech Daily Digest 08/24/2019
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BoE Governor Mark Carney is suggesting that more thought should be given to creating a global electronic currency that could act as “synthetic hegemonic currency provided perhaps through a network of central bank digital currencies”.
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In mimiciking MMMFs, Libra replicates their moral hazard: the MMMFs became too big to fail and many were bailed out. Central bankers wished they had followed the logic that if it looks like a duck, walks like a duck, it’s a duck (bank). They should not make the same mistake with Libra.
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“The financial institutions that have invested in Fnality know liquidity management and settlement processes must take a quantum leap to rein in the current inefficiencies, market fragmentation and counterparty risks. These banks accept the need for change and are exploring the potential of technology, by holding tokenised assets on a blockchain to trade and settle with near-instant finality. “
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The column argues that there are two fundamental factors that drive prices in the long run: the trustworthiness of the crypto’s blockchain and the adoption of the blockchain. Cryptos such as Bitcoin, Ethereum, and Monero are affected by these fundamentals. In some periods prices deviate, but eventually retrace the trend.tags: Fintech CryptoAssets
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“Hotmine CEO Oles Slobodenyuk couldn’t have picked a better place to pitch his product: a bitcoin mining rig that doubles as a home heating appliance.”
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Mr Jugnauth reiterated his vision of a cashless society to better secure financial transactions in Mauritius. MauCAS will be a real boost to e-commerce with its 24/7 payment system, he pointed out. The Prime Minister also announced the upcoming introduction of a “Central Bank Digital Currency”.
Kiffmeister’s Fintech Daily Digest 08/23/2019
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BoE Governor Mark Carney is suggesting that more thought should be given to creating a global electronic currency that could act as “synthetic hegemonic currency… provided… perhaps through a network of central bank digital currencies”.
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The majority of respondents believe central banks should issue CBDCs. A total of 29% of respondents say CBDCs should be limited to wholesale purposes; while 24% favour CBDCs at the retail level. However, a 43% say central banks should steer clear of them altogether.
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A new IMF paper discusses how fintech solutions in the Pacific islands can complement existing efforts to promote financial inclusion, enhance financial sector development, and increase inclusive growth potential, thereby reducing poverty.tags: Fintech
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Intensifying regulatory scrutiny of Facebook’s Libra digital currency has spooked some of the project’s early backers, with at least three privately discussing how to distance themselves from the venture.
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Binance experienced issues with APIs and withdrawal processing due to network issues with Amazon Web Services on August 23. Amazon has confirmed to The Block that AWS has experienced a temporary outage in the Asia Pacific (Tokyo) region.
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Crypto is a matter of concern for a number of tax departments around the world — primarily because they provide people with an avenue for commerce that expands beyond today’s existing financial systems. So, here are some crypto-centric economic frameworks that are being used by countries across the globe.
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The vast majority of the world’s cryptocurrency trading volume is in the hands of “lower quality exchanges”, while the world’s top-rated exchanges control only 5 percent of cryptocurrency trading volume, according to a new report from CryptoCompare.
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Over the past few years, Axoni, a distributed-ledger technology (DLT) firm, has been building the platform for Citigroup, Goldman Sachs, JP Morgan and other investors to make the convoluted process of reconciling equity swaps closer to a limpid one. The platform will eventually be open to any firm.
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Since the partnership with MoneyGram, the XRP market in Bitso (Mexico) has been steadily growing.
Kiffmeister’s Fintech Daily Digest 08/22/2019
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Rwandan Central Bank Studying Ways of Issuing Digital Currency
The Rwandan central bank is looking into ways it could potentially issue its own digital currency to make the processing of transactions more efficient and to boost economic growth.
tags: Fintech CryptoAssets AltCoins CBDC
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Ripple Partnership Provides New Payment Rail for UK Remittance Firm
UK-based remittance firm Xendpay is partnering with Ripple to use its RippleNet global settlements platform to allow it to enter new markets like the Philippines, Bangladesh, Malaysia, Vietnam, Indonesia, and Thailand.
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Chainalysis launches real-time alerts for ‘suspicious transactions’ across 15 cryptocurrencies
Chainalysis’s real-time crypto transaction AML monitoring/ compliance product began providing suspicious crypto-asset transaction alerts across 15 crypto-assets.
tags: Fintech CryptoAssets AMLCFT
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NYDFS Grants Charter For Bakkt To Custody Bitcoin
The New York State Department of Financial Services authorized Bakkt Trust Company LLC to offer custody services for Bitcoin following the introduction of trading physically delivered Bitcoin futures contracts on the Intercontinental Exchange Futures U.S. Under its charter, Bakkt will provide services to institutional customers.
tags: Fintech CryptoAssets Bitcoin Custody Bakkt Regulation Futures
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10 Million ETH: Big Mysteries Revealed About PlusToken
PlusToken’s intake of BTC, EOS, and XRP since the beginning of the scam in mid 2018 is still being calculated by our team. Once this data is finalized, we expect that PlusToken will easily emerge as the largest crypto Ponzi scheme in history, surpassing both BitConnect and OneCoin by a handsome margin.
tags: Fintech CryptoAssets Ponzi
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Understanding the crypto-asset phenomenon, its risks and measurement issues
This ECB article discusses the crypto-asset phenomenon with a view to understanding its potential risks and enhancing its monitoring.
tags: Fintech CryptoAssets
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The European Banking Association and the European Securities and Markets Authority have written to the European Commission to say they will review the legal frameworks used by European Union member states for monitoring stablecoins such as Libra.
tags: Fintech CryptoAssets PaymentSystems AltCoins Stablecoins Facebook
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The State of Stablecoins, 2019
2019 has proven a huge year for the development of stablecoins and decentralized finance, particularly in regards to projects built on the Ethereum blockchain.
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The New York Attorney General is investigating Bitfinex, Tether and various associated iFinex companies — on the basis, amongst other reasons, that there’s been funny business with the Tether “reserve”.
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Starbucks, monetary superpower
Starbucks has around $1.6 billion in stored value card liabilities outstanding. This represents the sum of all physical gift cards held in customer’s wallets as well as the digital value of electronic balances held in the Starbucks Mobile App.* It amounts to ~6% of all of the company’s liabilities.
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How China’s Virtual Banks Are Offering Loans to Micro-Businesses Within Minutes
In China, online lenders are filling the credit gap, leveraging cutting edge technology including artificial intelligence (AI) to make lending decision in just a second. Alibaba’s MyBank and Tencent’s WeBank make their lending decisions using AI, processing vast amounts of user data and information gathered from the mobile payment services they operate.
tags: Fintech MachineLearning AI
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More trouble in blockchain-land
Engineer sources told The Block that R3 is finding it hard to manage or support its growing client base, insinuating the company is flogging software that isn’t fully baked yet.
tags: Fintech Corda Blockchain
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New Flexa Tech Will Let You Spend Bitcoin From Other Apps Too
The merchant payments startup Flexa will soon allow any other app to run payments in crypto just like its own SPEDN app has since May. For now, Flexa delivers final payment to most merchants in fiat, working with exchange partners to provide liquidity to trade tokens used in payment for the final currency. But the Flexa system defaults to paying merchants in the cryptocurrency used by the customer, and it hopes to nudge more to do so.
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Binance Venus Aims to Outshine Libra and Chinese National Crypto?
Although both of the stablecoin projects may appear to be international in scope, Binance’s will likely only work with specific countries and regions in developing their own digital currencies to help establish financial autonomy and security.
tags: Fintech CryptoAssets AltCoins Stablecoins Binance Facebook
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Tether to Issue Stablecoin Backed by Yuan in Belgian Bank: Insider
Tether is planning to issue a stablecoin pegged to the Chinese renminbi, according to a trader with ties to the company.
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SEC Approves Blockchain Based Digital Securities Platform Securitize As A Registered Transfer Agent
A new blockchain startup called Securitize has been recently approved as a transfer agent by the U. S. Securities and Exchange Commission (SEC). This means that the company will now be able to act as an official keeper for records involving ownership changes in securities.
tags: Fintech Blockchain Regulation