Kiffmeister’s #Fintech Daily Digest (12/18/2020)

An Offline Payment System for Central Bank Digital Currencies

Visa published a technical paper that outlines an approach for offline point-to-point payments between two devices. The protocol allows digital money to be directly downloaded onto a personal device, such as a smartphone or tablet. The money is stored on a secure hardware embedded in that device and managed by a wallet provider (e.g. a bank). CBDC can be transacted from one device to another device directly without any intermediaries such as banks, payment networks, or payment processors. Examples of the underlying technology that can support point-to-point payments include Bluetooth and Near Field Communication (NFC). 

Crypto, What Is It Good For? An Overview of Cryptocurrency Use Cases

The World Economic Forum (WEF) Global Future Council on Cryptocurrencies published its inaugural report on digital assets entitled, Crypto, What Is It Good For? An Overview of Cryptocurrency Use Cases. It highlights a non-exhaustive list of companies, protocols and projects that represent the diversity of use cases that cryptocurrencies and the networks which they power can enable. The report highlights a series of “base layer” protocols, second layers, and service providers. It touches upon both financial services applications as well as non Fintech related services. 

Empty Set Dollar: An experiment in decentralised, composable, oracle-driven stablecoins

The recently launched Empty Set Dollar (ESD) stablecoin is built to be the reserve currency of decentralised finance. It sidesteps the centralisation risk of USDC, USDT, and TUSD, avoids AMPL and BASED’s death spirals, the 100+ percent collateralisation requirements of sUSD & DAI, and, most importantly, it integrates perfectly with existing DeFi protocols. The ESD protocol expands on the work of, which voluntarily shut down before launch due to regulatory pressure on the team. 

Coinbase is preparing to go public

Coinbase has filed the necessary paperwork with the U.S. Securities and Exchange Commission (SEC) to officially go public with an initial public offering (IPO). 

Legal Guidelines for Smart Derivatives Contracts

ISDA has published a series of legal guidelines for smart derivatives contracts. These guidelines provide high level background, identifying opportunities for the potential application of smart contract technology to derivatives contracts; and highlighting important issues for technology developers to consider when designing technology-enabled solutions for trading and processing derivatives and associated processes. These guidelines also highlight areas where further industry collaboration will be required to identify existing areas of legal and regulatory uncertainty and to develop solutions. 

Who has Been Affected by the Huge SolarWinds Cyberattack so Far?

As federal authorities and cybersecurity experts rush to identify the full scope of the SolarWinds compromise, the list of known targets grows. SolarWinds provides IT administrators with tools to manage and update their computer networks. The fallout from the cyberattack appears to be vast, with a slew of powerful U.S. government agencies and businesses seemingly being infected by hackers who are believed to be affiliated with Russia. SolarWinds says it has identified 18,000 customers potentially affected by the incident, which saw the culprits hijack software updates for a widely-used IT monitoring tool called “Orion” to spread malware, seemingly with the intention of espionage.