Kiffmeister’s #Fintech Daily Digest (06/21/2021)*

China’s PBOC Orders Alipay, Banks Not to Assist Crypto Business

The People’s Bank of China (PBOC) summoned Alipay and several major domestic to reiterate its prohibition on the provision of services linked to trading of virtual currencies, such as providing payment channels for crypto exchanges and over-the-counter platforms. Shortly after the PBOC’s statement, the ICBC, ABC, CBC and AliPay all issued a similar notice, stating that if any users were found dealing with crypto transactions, they would terminate the relevant customer accounts and would report the issue to the relevant authorities.  

China to shut down over 90% of its Bitcoin mining capacity after local bans

Many Bitcoin mines in Southwest China’s Sichuan Province – one of China’s largest cryptocurrency mining bases – were reportedly closed as of Sunday, after local authorities ordered a halt to mining in the region on Friday amid an intensified nationwide crackdown against cryptocurrency mining. The ban also means that more than 90 percent of China’s Bitcoin mining capacity is estimated to be shut down, at least for the short term, as regulators in other key mining hubs in China’s north and southwest regions have taken similar harsh steps. 

Banque de France tested digital currency-based securities settlement

On June 18, the Banque de France successfully conducted a central bank digital currency (CBDC) experiment with SEBA Bank, as part of the experimental program launched in March 2020. The CBDC was used to simulate the settlement of listed securities and trigger their delivery in the TARGET2-Securities (T2S) test environment, using T2S’s conditional securities delivery (CoSD) feature. The Banque de France simulated CBDC issuance on a public blockchain, preserving control and confidentiality of transactions using a dedicated smart contract. 

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