Kiffmeister’s #Fintech Daily Digest (03/25/2021)*

ECB on digital central bank money for Europeans – getting ready for the future

According to this European Central Bank (ECB) blog post… “There are three misconceptions about the digital euro. First, that the ECB intends to abolish cash and then, having done so, impose even lower interest rates on the digital euro for reasons related to how monetary policy is implemented. Second, that a digital euro would displace banking intermediation. And third, that the digital euro would not be based on a viable business model. First of all, it is not yet decided whether a digital euro will be introduced at all. We are still exploring the possibility and considering it conceptually. Later this year, the ECB’s Governing Council will decide whether or not the ECB should launch a project to get ready to issue a digital euro. Even if it decides to do so, it would simply mean that it want to be prepared. A decision to actually issue a digital euro would come at a later stage.” 

BIS Innovation Hub and SWIFT announce winners of ISO 20022 and API hackathon

The BIS Innovation Hub and SWIFT announced the three winners of the ISO 20022 hackathon, which invited teams to build and showcase solutions that enhance cross-border payments, using the ISO 20022 standard for payments messages and application programming interfaces (APIs):

  • Atomic Wire won for its highly scalable stream processing solution that performs real-time atomic settlement of FX transactions, eliminating settlement risk and removing barriers to adopting payment-versus-payment for cross-border payments. 
  • Mojaloop won for its solution for bridging the “last mile,” bringing cross-border payments to users in emerging market economies who rely on mobile money transfer systems. 
  • The Isonauts (Virtusa & AWS) won for their solution using machine learning to ensure completeness and correctness of data as a basis for smoothing international payments.  

Fidelity files for Bitcoin ETF

Fidelity Investments has filed with the US Securities and Exchange Commission (SEC) to list a new Bitcoin exchange-traded fund (ETF). The Wise Origin Bitocin Trust aims to track Bitcoin’s daily performance using the Fidelity Bitcoin Index PR, an index that’s derived from several price feeds. 

U.S. regulator reportedly opens inquiry into Wall Street’s blank check IPO frenzy

The U.S. Securities and Exchange Commission (SEC) has reportedly opened an inquiry into “blank check” special purpose acquisition companies (SPACs). SPACs are listed shell companies that raise funds to acquire a private company with the purpose of taking it public, allowing such targets to sidestep a traditional initial public offering. The SEC letters asked the banks to provide the information voluntarily and, as such, did not rise to the level of a formal investigative demand. The SEC wanted information on SPAC deal fees, volumes, and what controls banks have in place to police the deals internally. 

* 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.