Kiffmeister’s #Fintech Daily Digest (20220906)

RBI in talks with 4 banks, fintechs for CBDC launch this financial year

The Reserve Bank of India (RBI) is reportedly in talks with fintech companies and state-controlled banks about a trial run of a central bank digital currency (CBDC) with a possible rollout by the end of the fiscal year ending March 31, 2023. The list of fintechs that the RBI is consulting include US-based FIS, plus four state-run banks to run a pilot CBDC project (State Bank of India, Punjab National Bank, Union Bank of India and Bank of Baroda). [Read more at MoneyControl]

Binance, Issuer of 3rd Biggest Stablecoin, to Stop Supporting Larger Rival USDC

Binance effectively banished USD Coin (USDC), the second-biggest stablecoin, from trading at its cryptocurrency exchange in favor of its own competing product. On September 29, customers’ holdings of USDC will be converted to Binance USD (BUSD). The same will happen with two smaller stablecoins: Pax Dollar (USDP) and TrueUSD (TUSD).  The action effectively removes USDC as a tradable asset on one of the most prominent perches in crypto, and creates a headache for Circle Internet Financial, USDC’s issuer, as the company mulls an IPO. [Read more at Binance]

Bitcoin S&P 500 Correlation: Be Careful What You Wish For

Here’s an interesting observation from Caitlin Long. The correlation between Bitcoin and the S&P 500 bounced around zero for years, but hasn’t been negative since 2020, and now it’s fluctuating around 50% (see below). Caitlin attributes this to hedge funds buying leverage on, and correlation with, them, and Bitcoin trading markets have paid a big price for the liquidity they brought. I would argue that it’s an instance of “be careful what you wish for” with respect to the “institutionalization” and popularization of crypt. Crypto is just another “risk-on/risk-off” asset class.

 

Discounted tickets available for CBDC Think Tank masterclass

The CBDC Think Tank, in partnership with the IMF and George Washington University, is hosting a full-day in-person CBDC Masterclass on October 12 in Washington DC for “official sector” staff. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Ticket prices start at $99 and you can save 30% by entering KIFFMEISTER where the registration page asks for a discount code. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE Digital Currency Lecture Series, a set of digital currency lightning talks delivered by subject matter experts, on October 14 in Washington DC. [Request an invite here]

Kiffmeister’s Global Central Bank Digital Currency Monthly Monitor

Just a reminder that I produce a monthly digest of central bank digital currency (CBDC) developments exclusively for the official sector. So for any of you out there who work for a central bank, ministry of finance or international financial institution who would like to receive it by email on the first business day of every month, please DM me on LinkedIn or email me at chronicles@kiffmeister.com.

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