Digital yuan pilot surges to 140 million, 10% of population
The People’s Bank of China (PBOC) shared the latest statistics on their digital yuan (eCNY) pilot. The number of wallets opened has increased almost sevenfold since June to 140 million, and the number of merchants capable of accepting the digital renminbi is 1.55 million (see table). However, before launch, more work is needed on capacity expansion, security and risk management, and the legal/regulatory framework. For example, the digital forms of the renminbi have to be added to the People’s Bank of China Law, and regulatory measures for eCNY need to be tailormade. [Read more]
Bahamas central bank estimates ‘north of $300K’ Sand Dollars in circulation
The Central Bank of Bahamas reportedly estimates that in excess of 20,000 individuals are currently utilizing Sand Dollars, with “north of $300,000” of the central bank digital currency (CBDC) currently in circulation. The central bank is nearing the end of ensuring there is interoperability with the automated clearing house (ACH) so there can be a pass-through link between Sand Dollar wallets and deposit accounts. Once that exercise is completed, the central bank along with the financial institutions, is going to be focusing on making an aggressive push to get more businesses enrolled in the infrastructure. [Read more]
JP Morgan, Oliver Wyman predict CBDC to save $100 billion cross border payment costs
Oliver Wyman and JP Morgan published a joint report exploring how a multiple central bank digital currency (mCBDC) network could save corporates money. They estimate that corporate wholesale payments amount to $24 trillion a year and cost $120 billion, which could fall by $100 billion using an mCBDC network. The savings will come at the expense of banks, via the loss of correspondent banking fees and the reduction of corporate overnight balances by up to $10 billion. Plus, banks will have to pay to operate two sets of cross-border payment systems in parallel during this transition. [Read more]
US SEC Delays Decision on Valkyrie Bitcoin Spot ETF Proposal Until 2022
The US Securities and Exchange Commission (SEC) has once again delayed approving a proposed exchange-traded fund (ETF) backed by physical Bitcoin applied by Valkyrie Investments, this time to January 7, 2022. The Valkyrie Bitcoin Fund is a physical bitcoin (spot) ETF, which is fundamentally different from recently-approved futures ETFs such as the Valkyrie Bitcoin Strategy ETF, which gives customers shares tied to a series of contracts to buy Bitcoin in the future. [Read more]
ASIC releases guidance on crypto-asset related investment products
Australian Securities and Investments Commission (ASIC) recently released information for product issuers and market operators on how they can meet their regulatory obligations in relation to crypto-asset exchange traded products (ETPs) and other investment products. It covers good practices in how these products are admitted and supervised by market operators, and good practices in how product issuers establish and operate them. It also includes good practice guidance on admission and monitoring standards, custody of crypto-assets, pricing methodologies, disclosure and risk management. [Read more]
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