Kiffmeister’s #Fintech Daily Digest (08/07/2021)*

Central Bank of Venezuela Digital Bolivar: CBDC or Not?

“The Central Bank of Venezuela announced a redenomination plan for its fiat currency called the “Digital Bolivar.” This proposal seeks to simplify transactions by slashing six zeroes from the current value of the currency.” Earlier this week I jumped to the conclusion that it was a central bank digital currency (CBDC), but it may be more about the development of a private sector digital economy. Juan Gutiérrez‘s translation of the central bank’s press release seems to concur:

“Recently, the new Financial Messaging Exchange System, made in Venezuela and by Venezuelans, began operations, promoting the independence from foreign systems for national banking operations and consolidating the use of the Bolivar. The modernization of payment systems aims to immediately expand the use of the digital bolivar, enabling transfers between clients of different banks to be received in a few seconds with the highest international quality standards.”

Maybe it will turn out to be CBDC, but we need more details to back that up.  

Senate on the Brink of Passing Bill That Threatens Crypto. Here’s What Happens Next

The Senate is gearing up to vote on a $1 trillion infrastructure bill, but first, it’s got to figure out what to do about cryptocurrency. To pay for part of the bill’s proposals, its authors included a provision that will expand the definition of “brokers” to include those dealing in digital assets, such as miners, validators, wallet providers, and DeFi protocol developers. Senators Ron Wyden (D-OR), Cynthia Lummis (R-WY), and Pat Toomey (R-PA) offered an amendment that would exempt non-custodial actors. That was followed by a competing amendment from Senators Mark Warner (D-VA) and Rob Portman (R-OH) that would only explicitly exempt proof-of-work miners and wallet providers from the requirement. This Decrypt article runs through the various scenarios that could unfold over the weekend. 

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