Kiffmeister’s #Fintech Daily Digest (01/31/2021)*

Some big news. I’ve just launched an experimental Global Fintech Monthly Monitor that rolls up all of the news that I’ve been reporting here into a thematically organized summary. It and the new Global Fintech Intelligencer blog are still very much works in progress, they’re still a bit rough, and comments and suggestions will be greatly appreciated. Going forward I plan to post these monthlies there, plus long-form more analytic articles, written by me and others, so stay tuned!

Indian parliament to consider issuing central bank digital currency and banning private crypto-assets

On January 29, the Indian government announced that it will introduce The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, during the next session of the lower house of parliament (Lok Sabha). The Bill will “create a facilitative framework for creation of the official digital currency to be issued by the Reserve Bank of India. The Bill also seeks to prohibit all private cryptocurrencies in India, however, it allows for certain exceptions to promote the underlying technology of crytptocurrency and its uses.” 

Visa May Add Crypto-Assets to Its Payments Network, Says CEO

Visa CEO Al Kelly said his firm is in a position to make crypto-assets more “safe, useful and applicable” and may add them to its payments network. Speaking on the company’s fiscal first-quarter 2021 earnings call, Kelly described crypto-assets like bitcoin as “digital gold” which are “not used as a form of payment in a significant way at this point.” “Our strategy here is to work with wallets and exchanges to enable users to purchase these currencies using their Visa credentials or to cash out onto our Visa credential to make a fiat purchase at any of the 70 million merchants where Visa is accepted globally.”  

Ripple Responds to SEC in Court, Alludes to Bias in Ether Classification

Ripple introduced a detailed response that addressed allegations surrounding the U.S. Securities and Exchange Commission (SEC) lawsuit filed against the firm in December. It states that there is no significant differences between XRP’s function and that of Bitcoin and Ethereum. But, while the SEC recognized the two most popular digital currencies as non-securities, the agency turned around and said the opposite was true for its own token. Ripple has also filed a Freedom of Information request with the SEC, asking the agency to explain why it said ETH was born a security, but eventually evolved into a non-security. 

* The views expressed herein are those of the author and should not be attributed to the International Monetary Fund, its Executive Board or its management.