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With regard to their volatile prices, limited number, small total amount, and concentrated market, stablecoins have so far met with a mixed success. They rather represent a complement to the crypto-assets market. However, the arrival of very large issuers, securing a higher degree of confidence to users, and apt to reach a wide public, could give their projects a potentially systemic impact. These global stablecoins would create risks, in particular for financial stability and monetary policy, and in lesser-developed economies. This paper reviews these risks and the way the private sector, regulators and central banks can address them.
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Circle’s business clients can now sign up for the Circle Business Account, a toolbox of APIs that allow developers to build on top of its USDC stablecoin.
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The UK’s biggest fintech startup Revolut is reportedly preparing to apply for a UK banking licence, enabling the firm to offer FSCS-protected deposits and lending services for customers. The cash transfer app was granted a European banking licence by the Bank of Lithuania in 2018, but has continued to operate outside of the bounds of the regulatory regime in the UK.
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On Sunday, BitMex had the most Bitcoin-related liquidations in three months, according to crypto derivatives tracker Skew. More than $190 million has been liquidated on the exchange in the last 24 hours, according to TokenAnalyst.io. BitMex offers as much as 100 times leverage on futures contracts, and when trades go bad, users are at risk of facing margin calls on what’s borrowed that can end up leading to the liquidation of their position.
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The miner’s rolling inventory (MRI) figure, created by crypto markets data company ByteTree to measure the changes in inventory levels held by these key market participants, remained below 100 percent in January, suggesting a lack of confidence in the 30 percent price rally that month.
Some catching up on some recent regulatory news thanks to the always excellent bi-weekly Milken Institute Fintech in Focus:
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Dubai International Financial Centre signed a Memorandum of Understanding with Tribe Accelerator, the first Singapore government supported Blockchain accelerator, to collaborate on knowledge sharing and to partner during joint events.
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The Saudi Arabian Monetary Authority (SAMA) has announced the success of two experiments of providing online opening of bank accounts and electronic wallets to individual institutions and resident companies within the framework of the regulatory experimental environment (sandbox) for innovative financial services and products in the Kingdom. With the participation of a number of banks and financial technology companies operating in the local market.tags: Fintech Regulation
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The Saudi Arabian Monetary Authority “SAMA” announces the licensing of two digital wallet companies; Bayan Payments (Bayanpay) and Halalah. This comes after their successful graduation of SAMA regulatory sandbox. This decision is based on SAMA’s mandate to license, control, and oversee the payments sector in the Kingdom as per the Council of Ministers Resolution No. 226 dated 02/05/1440 H.tags: Fintech Regulation
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The Saudi Arabian Monetary Authority published Additional Licensing Guidelines and Criteria for Digital-Only Banks in Saudi Arabia.tags: Fintech DigitalBanks
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The Gulf region has become a hotbed for FinTech activity and regulatory development, with several jurisdictions competing to establish themselves as the FinTech hub in the region.tags: Fintech
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The South Korea Financial Services Commission announced its key policy plans for fintech and digital finance, which include advancing digital finance, promoting data economy, cultivating new fintech industry and services, working on regulatory reform in fintech and digital sectors, and strengthening the foundation for innovation.tags: Fintech
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Global fintech investment in 2019 fell just shy of 2018 results, with $137.5 billion invested across 2,693 deals. Despite the slight drop, fintech investment remained more than double every year prior to 2018 — highlighting the enormous strength of the global fintech market. Two deals drove a very significant proportion of this investment: the $42.5 billion acquisition of Worldpay by Fidelity National Information Services (FIS) and the $22 billion acquisition of First Data by Fiserv.tags: Fintech
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“The business opportunities presented by cryptoasset custody models are significant. The wave of institutions entering and participating in the market need a trusted partner to hold their cryptoassets for safekeeping, minimizing the risk of theft or loss while ensuring they are available and accessible for speedy transactions on blockchain networks. However, the technical and operational requirements of cryptoasset custody, security and exchange create unique challenges for enterprises and financial services institutions, including both traditional institutions and crypto-native startups.”
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Bank Negara Malaysia issued an updated Exposure Draft on the Licensing Framework for Digital Banks that incorporates the proposed simplified regulatory framework for digital banks applicable during the foundational phase. The simplifications aim to reduce regulatory burden for new entrants that have strong value propositions for the development of the Malaysian economy, whilst safeguarding the integrity and stability of the financial system.tags: Fintech
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The European Data Portal released a new study on the value created by open data across Europe and builds on the EDP’s 2015 report “Creating Value through Open Data”.
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A Thomson Reuters Regulatory Intelligence report sheds further light on the impact that technology is having on the role of compliance within financial service firms. It highlights the ebb and flow of attitudes on the adoption and use, in practice, of technology in financial services. It also examines the shifting role of the regulator and global concerns over tackling rising cyber-risk.
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The Ministry of Finance will be directly involved in the development of financial technologies in Bulgaria by setting up a regulatory box (Sofia RegTech Sandbox) and participating in its management.
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Brunei’s monetary authority called for applications to enter its FinTech Regulatory Sandbox. The sandbox—which was first established in February 2017—has seen a number of companies test their financial products and services.