Kiffmeister’s #Fintech Daily Digest (20230331)

March 31, 2023March 31, 2023 ~ kiffmeister ~ 12 Comments

Sweden does not yet need CBDC, inquiry finds

Sweden does not yet need a central bank digital currency (CBDC) according to a government-appointed investigation. After more than two years’ work, the Payments Investigation presented over 900 pages of analysis to the government. The inquiry, led by Anna Kinberg Batra, concluded the case for a Swedish CBDC or e-krona is not yet strong enough. “We have a guarantee on bank deposits if anything happens to the banks, and banks are also heavily supervised under a rigorous regulatory framework.” However, the report recommended Sveriges Riksbank continue to study CBDC and return to Sweden’s parliament in 2024 with new proposals, if warranted. [Read the full report (in Swedish) on the parliamentary website]

The report acknowledged that “too many people are stuck outside the digital system” and suggested pressuring banks in Sweden to offer so-called “low-risk accounts” with limited functions (such as, for example, limits on international payments). It also calls on the government to to develop and run its own digital ID system, or to put out a tender for one which would be run by a private provider, to replace the private bank-run BankID system that excludes foreigners, such as refugees, foreign students, and people working on short-term contracts, making it impossible for them to identify themselves and use digital payment systems. [Read more at The Local SE]

What consumer surveys say about the design of a U.S. CBDC for retail payments

To understand how a CBDC could provide a good user experience, the Kansas City Fed’s Franklin Noll analyzed recent surveys in the United States and in other countries that have asked consumers about their wants and needs for a potential CBDC. Overall, a majority of polled consumers prefer a CBDC to be dependable, secure, and convenient—a reliable and secure digital payment method that is simple, fast, and makes their lives easier. U.S. respondents indicated that they were generally comfortable with government access to their transactional and financial data if it was clear what information the government could access and under what circumstances. European consumers responded similarly, indicating that they do not have particular concerns about an issuer of a payment instrument knowing their transaction details and that a “medium level of financial privacy” is acceptable. At this level of privacy, non-detailed transaction data is stored by the bank and only shared with the government as legally required. [Read more at the Kansas City Fed]

The Rise and Impact of Fintech in Latin America

The IMF published a paper that examines the development of the financial sector in Latin America, focusing on fintech services and regulation. Exploring fintech’s macro-critical impact using country- and bank-level data, the paper finds that booming financial technologies in Latin America have helped boost competition in the banking sector and inclusion. Additionally, it demonstrates that fintech firms in Latin America experienced robust growth even during the pandemic supported by external funding. Finally, the paper discusses how regulators are addressing the risks associated with financial technologies and how they are leveraging fintech tools in their supervisory activities. [Read more at the IMF]

Boerse Stuttgart Digital subsidiary receives final approval for crypto custody

Boerse Stuttgart Digital, the digital asset brand of the Boerse Stuttgart exchange group has received final licensing from the German Federal Financial Supervisory Authority (BaFin) for its blocknox service to operate as a crypto custodian. Boerse Stuttgart Digital has been providing custody services through blocknox under a provisional license since crypto custody regulations were introduced in Germany on January 1, 2020. It had begun offering trading services to German residents in the prior month and introduced a trading app in 2021. Boerse Stuttgart Digital received its final custody licensing ahead of several other contenders, including Binance. [Read more at Bourse Stuttgart Digital]

Upcoming conferences, webinars and speaking engagements:

I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register 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.

The Sovereign Official Digital Association (SODA) is a technology-agnostic firm offering advisory services at the intersection of central banking, digital finance and the web3 industry, aiming to make public digital money a reality. SODA believes institutions in the existing financial ecosystem should have access to the tools and resources they need to move from discussion to action. SODA offers ‘real life’ use cases to help test digital money and drive adoption as central banks and other public institutions explore the future of a more financially inclusive world powered by interoperable blockchain-based networks. SODA would love you to join us on this journey – please get in touch (chris@sodapublicmoney.org).

Satoshi Capital Advisors is a New York-based, global advisory firm that works with central banks, governments, and the private sector to architect, implement, and operate varying initiatives. Satoshi Capital Advisors’ central bank work revolves around CBDC architecture and implementation, providing advisory services from research phase through to growth phase. Utilizing a product-market fit and technology agnostic approach to CBDC architecture and implementation enables Satoshi Capital Advisors to build tailored solutions, bespoke to local financial system nuances. Satoshi Capital Advisors welcomes requests from central bank officials for virtual and in-person CBDC workshops. [Click here for more information]

WhisperCash offers the first fully offline digital currency platform that has the same properties as physical cash. It can perform secure consecutive offline payments without compromising on security, privacy or accessibility. WhisperCash allows direct person to person offline payments without any server infrastructure or internet connectivity. It comes in various form factors including the self-contained credit card-sized “Pro” that sports an eInk screen and capacitive keyboard, and lasts for two weeks between recharges assuming a few transactions per day. [Click here for more information]

Protected: Kiffmeister’s CBDC Monitor, March 2023

March 31, 2023April 27, 2024 ~ kiffmeister

Kiffmeister’s #Fintech Daily Digest (20230329)

March 29, 2023March 29, 2023 ~ kiffmeister

Russia delays digital ruble launch testing due to lawmaking process

The next phase of the Bank of Russia’s central bank digital currency (CBDC) testing, slated to start on April 1, 2023, has been delayed because relevant legislation has only passed through the first reading in the State Duma — the Federal Assembly’s lower house. However, the legislation may be enacted by early May. Meanwhile, the number of private banks participating in the pilot has also changed from 15 to 13. Some of the banks’ employees would become the test participants for CBDC retail payments, as well as one of the largest insurance companies in the country, Ingosstrakh. Hence, although the April 1 launch was being billed as a “pilot” is appears to be either further proof-of-concept or prototyping work, since none of the general public isn’t involved in the testing. [Read more at TASS]

Opening of the BIS Innovation Hub Eurosystem Centre

The Bank for International Settlements (BIS) Innovation Hub Eurosystem Centre, a joint effort by the BIS and all Eurosystem central banks, opened on March 28, 2023. The Centre will have offices in Frankfurt and in Paris, hosted and supported by the Deutsche Bundesbank and the Banque de France. The European Central Bank will coordinate the interactions of the Eurosystem with the Centre. The Centre’s project focus areas will be decentralized finance (DeFi), wholesale CBDC, cyber security and green finance. Projects include Atlas, which will create an open-source data platform to provide information on DeFi and crypto-asset market capitalization, economic activity and international flows of crypto-assets, and Mariana, which will explore automated market-makers (AMM) for the cross-border exchange of Swiss franc, euro and Singapore dollar wholesale CBDCs. [Read more at the BIS]

EU lawmakers impose €1,000 cap on anonymous crypto, cash transactions

European lawmakers have adopted legislation imposing a €1,000 cap on anonymous cryptocurrency transactions, as part of the Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) package. The draft bill also seeks to cap anonymous cash transactions above €7,000 when it is not possible to identify the sender. The bill had an overwhelming majority of 99 votes in favor, eight against and six abstentions. The European parliament will start negotiations on the final text of the AML/CFT package after a plenary session in April. [Read more at the European Parliament]

Oxbridge Re starts selling tokenized securities to back its reinsurance sidecar

Oxbridge Re Ltd., the Cayman Islands based reinsurance firm with a Gulf Coast risk focus, has begun the initial offering of DeltaCat Re tokenized reinsurance securities, that will represent fractionalized interests in reinsurance contracts written by its reinsurance sidecar. “Democratizing reinsurance through tokenization allows investors to participate directly in the reinsurance business, which traditionally has extremely high barriers to entry… and enable the underwriting of higher value reinsurance contracts.” [Read more at Artemis.bm]

Upcoming conferences, webinars and speaking engagements:

I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230328)

March 28, 2023March 28, 2023 ~ kiffmeister ~ 1 Comment

CFTC sues Binance, CEO Zhao over ‘willful evasion’ of U.S. laws, unregistered crypto derivatives products

The U.S. Commodity Futures Trading Commission (CFTC) sued crypto exchange Binance and founder Changpeng Zhao on allegations the company knowingly offered unregistered crypto derivatives products in the U.S. against federal law.
The suit also alleged that the company directed its employees to spoof their locations through the use of virtual private networks (VPNs). The CFTC is charging Binance with violating laws around offering futures transactions, illegal off-exchange commodity options, failing to register as a futures commissions merchant, designated contract market or swap execution facility, poorly supervising its business, not implementing know-your-customer (KYC) or anti-money laundering (AML) processes and having a poor anti-evasion program. [Read more at the CFTC]

Zhao replied to the complaint and classified them as “unexpected” and “disappointing.” The executive claims that the company has worked with the U.S. regulator since 2021. Zhao said: “upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged in the complaint.” [Read more at Binance]

Custodia comments on the Fed’s 86-page order: new Fed policies and procedural abnormalities

The Fed Board of Governors released its final order on Wyoming-based Custodia Bank’s application to become a member of the Federal Reserve system, expressing strong doubts about Custodia’s management team, financial condition and business model in rejecting the application. Custodia responded with a framing of the context for the Fed’s implicit new policy stance and and what other banks might learn from them. The Fed outlined at least five new policies in the Custodia order, including the casting doubt on whether any issuer of a stablecoin on an open, public and/or decentralized network can comply with anti-money laundering/combating financing of terror laws. Also, the Fed de facto established a new requirement that state banks be FDIC-insured in order to become Fed member banks because, in its words, FDIC insurance is “a critical tool in preventing bank runs.” [Read more at Custodia]

Facilitating increased adoption of payment versus payment (PvP)

The Committee on Payments and Market Infrastructures (CPMI) published the final report on the facilitation of increased adoption of payment versus payment (PvP) to reduce foreign exchange (FX) settlement risk and improve cross-border payments. It analyses the causes of non-PvP settlement, takes stock of existing and proposed new PvP solutions and suggests roles for the private and public sectors to facilitate increased adoption of PvP. The report finds that existing PvP arrangements have been successful at reducing settlement risk for much of the FX market, but certain market segments remain exposed to risk: PvP arrangements are not available for all currencies and may not be the preferred solution of some market participants or for settling certain trades. New PvP solutions can complement the existing arrangements by providing flexibility and functionalities such as real-time settlement or 24/7 operations, expanding coverage to the retail market, and supporting emerging market currencies. [Read more at the CPMI]

UK Treasury Cancels Plans for Government-Backed NFT

The U.K. Treasury is canceling its plans to release a government-backed non-fungible token (NFT). The Royal Mint was tasked with releasing the token by the summer of 2022 but faced delays. The U.K.’s economic secretary Andrew Griffith said that the plans were not moving forward “at this time” but that the proposal would remain under review. Chair of the Treasury Select Committee Harriet Baldwin said that the government’s chief financial minister would be asked if issuing an NFT “remains the policy of his department.” [Read more at CoinDesk]

Upcoming conferences, webinars and speaking engagements:

I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230325)

March 25, 2023March 25, 2023 ~ kiffmeister

Fed explains why Custodia got an ‘F’ on its examination

The Fed’s Board of Governors released its final order on crypto-centric, Wyoming-based Custodia Bank’s application to become a member of the Federal Reserve system. The central bank raised strong doubts about Custodia’s management team, financial condition and business model in rejecting the application. [Read more at the Fed]

The Bank of Japan’s framework for participation in the CBDC Forum

Norbert Gehrke has written up a summary of the terms of engagement for participating in the Bank of Japan’s (BoJ) central bank digital currency (CBDC) prototyping work. (The BoJ calls it a “pilot” but there are no end users taking part, so it sounds more like “prototyping” to me.) “The BoJ will select participants and contractors for developing the experimental system, proceeding with discussions and explorations with the participants and the development of the system.” [Read more at Medium]

Upcoming conferences, webinars and speaking engagements:

I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230324)

March 24, 2023March 24, 2023 ~ kiffmeister

Project Nexus prototype successfully links Eurosystem, Malaysia and Singapore payments systems; partners in Indonesia, Malaysia, the Philippines, Singapore and Thailand to work towards wider payments connectivity

The BIS Innovation Hub Singapore Centre and partners successfully connected the test versions of three established instant payment systems (IPS) using the Nexus model. The next phase of the project will work on the real-world potential of a multilateral network that could be scaled up across more countries. The year-long collaboration included the Bank of Italy, Central Bank of Malaysia (BNM) and Monetary Authority of Singapore (MAS). Test payments were initiated using only the mobile phone numbers or the recipients’ company registration numbers via the Eurosystem’s TARGET Instant Payment Settlement (TIPS), Malaysia’s Real-time Retail Payments Platform (RPP) and Singapore’s Fast and Secure Transfers (FAST) payment system. For the next phase of the project Bank Indonesia, BNM, Bangko Sentral ng Pilipinas, MAS and the Bank of Thailand will leverage experiences from Phase I and Phase II of the project towards connecting their countries’ IPS and facilitate cross-border transactions across a combined population of about 500 million people. Looking ahead, the BIS and the five central banks envisage that Nexus could eventually be implemented globally. To achieve this, they will aim to establish a Global Advisory Panel of central banks and payment system operators to advise on the project’s development beyond the Southeast Asian region. The Bank of Italy and the European Central Bank will be invited to join this panel. [Read more at the BIS]

Successful testing paves way for CBDC use cross-border

Financial messaging firm SWIFT published the results of their experimental central bank digital currency (CBDC) interlinking solution in a sandbox environment with 18 central and commercial banks. It was successfully tested across almost 5,000 transactions between two different blockchain networks and a traditional fiat currency. SWIFT concluded that their solution can meet the needs of CBDC interoperability, ensuring CBDCs can be successfully used in cross-border payments. [Read more at SWIFT]

Upcoming conferences, webinars and speaking engagements:

I’ll be on a “public finance and the digital future” panel at the March 23-25 Willamette College of Law “Our Money, Our Future” (Hybrid) Conference in Salem, Oregon on March 24. [Register here]
I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230323)

March 23, 2023 ~ kiffmeister

Coinbase warned by SEC of potential securities charges

The U.S. Securities and Exchange Commission (SEC) issued Coinbase a Wells notice, warning that it identified potential violations of U.S. securities law. Based on discussions with the SEC staff, Coinbase believes they relate to aspects of the Company’s spot market, staking service Coinbase Earn, Coinbase Prime and Coinbase Wallet, and the potential civil action may seek injunctive relief, disgorgement, and civil penalties. [Read more at Coinbase]

CBUAE Central Bank Digital Currency strategy launched

The Central Bank of the United Arab Emirates (CBUAE) has engaged with G42 Cloud and R3 as the infrastructure and technology providers respectively for its central bank digital currency (CBDC) implementation. The first phase, which is expected to complete over the next 12 to 15 months, comprises (1) the soft launch of mBridge to facilitate real-value cross-border CBDC transactions for international trade settlement, (2) proof-of-concept (PoC) work for bilateral CBDC bridges with India, and (3) PoC work for domestic CBDC issuance covering wholesale and retail usage. [Read more at Emirates News Agency]

Digital Currency and Banking-Sector Stability

According to a paper published by the Office of Financial Research (OFR), if a central bank digital currency (CBDC) or stablecoin became fully integrated into the financial system, banking-sector stability may suffer, but household welfare may improve. The paper’s financial stability focus is on the risk that banks have insufficient equity capital following losses from their investments. [Read more at the OFR]

Upcoming conferences, webinars and speaking engagements:

I’ll be on a “public finance and the digital future” panel at the March 23-25 Willamette College of Law “Our Money, Our Future” (Hybrid) Conference in Salem, Oregon on March 24. [Register here]
I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230321)

March 21, 2023March 21, 2023 ~ kiffmeister

How “payment banks” could prevent the next bank collapse

Calls for “payment banks” are spreading in the wake of the Silicon Valley Bank (SVB) debacle and the teetering of other “community banks”. “It’s tempting in light of SVB’s failure to assume that the insured deposit limit needs to be raised, but that solution creates new problems. A better approach would be for the U.S. to follow the example of other countries and create “payment banks” that take little-to-no risk, are highly regulated, and have access to the payment network. They would be a place where companies could park funds — like venture capital investment earmarked for payroll — without exposing themselves to the risks that normal banks create.” [Read more at the Harvard Business Review]

Why can’t we just have safe, boring banks?

However, the Federal Reserve has been blocking non-lending banks from accessing Fed payment systems, though, which means the “safe banks” either cannot operate at all or cannot provide the very “safe banking” services that consumers want. Custodia Bank is one such bank, and its CEO Caitlin Long makes an interesting point about the soon-to-be-launched FedNow fast payments platform: “In the thick of today’s social media-accelerated, online-banking accelerated banking crisis, the “borrow short-term and lend long-term” model is less stable than it has ever been. And it’s about to become even less stable – because the speed of money movement in the U.S. is scheduled to accelerate this July, when the new FedNow payment system comes online. Intended to replace Fedwire, FedNow will allow depositors to access their bank deposits 24/7/365. Just imagine how much worse today’s banking crisis would be if panicked depositors could move their funds during the news-filled weekends. [Read more at Caitlin-Long.com]

Banking in a digital fiat currency regime

Rohan Grey has written about these banking system-related issues and has published a paper on how a retail central bank digital currency (CBDC) could provide the public with digital checking and payments services, independent of the existing bank-centric depository system. He argues that in such a regime, existing banks will continue to underwrite loans and evaluate collateral, even as their checking and payments processing functions are rendered obsolete. Loans would be funded by CBDC overdrafts directly to successful loan applicants who are creditworthy and/or whose proffered collateral meets prudential regulatory standards. These DFC overdrafts (effectively secured loans) would be recorded as a liability of the lending bank, and an asset of the central bank. [Read more at RohanGrey.net]

Upcoming conferences, webinars and speaking engagements:

I’ll be on a “public finance and the digital future” panel at the March 23-25 Willamette College of Law “Our Money, Our Future” (Hybrid) Conference in Salem, Oregon on March 24. [Register here]
I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230318)

March 18, 2023 ~ kiffmeister

Measurement and Use of Cash by Half the World’s Population

The IMF published a paper that analyzes cash usage in 14 advanced and emerging market economies, using two measures; currency in circulation (CIC) and the value of cash withdrawn from ATMs. It finds that, while the CIC metric continues to rise, ATM withdrawals are declining rapidly. The main reason for this is that CIC includes cash used for payments, hoarding, and illegal use while ATM cash is focused much more on the use of cash for payments alone. As well, CIC is not adjusted for the turnover of cash for payments while ATM cash already includes it. The 14 countries in our sample account for half of the world’s population and two-thirds of its GDP. [Read more at the IMF]

Monetary Policy Implications Central Bank Digital Currencies: Perspectives on Jurisdictions with Conventional and Islamic Banking Systems

The IMF published a paper on the potential impacts of central bank digital currency (CBDC) on monetary policy, through their effects on money velocity, bank deposit disintermediation, volatility of bank reserves, currency substitution, and capital flows. Countries most vulnerable are those with banking systems dominated by small retail and demand deposits, low digital payments usage, and weak macro fundamentals. Caps on CBDC holdings and zero remuneration can moderate disintermediation risks, but they are not sufficient. Jurisdictions with Islamic banking systems could be more vulnerable to deposit disintermediation because of the predominance of unremunerated deposits and retail deposits in banks. The underdeveloped nature of Islamic financial markets and Sharia’h compliant liquidity management tools could also limit the central banks’ scope to respond to liquidity shocks. [Read more at the IMF]

Central Bank Digital Currency and Financial Inclusion

The IMF published a paper that models the financial inclusion implications of introducing a retail CBDC through two key channels. First, CBDC issuance can increase bank deposits from the previously unbanked by incentivizing the opening of bank accounts for access to CBDC wallets. Second, data from CBDC usage allows for the building of credit to reduce credit-risk information asymmetry in lending. We find that CBDC can increase overall lending if (1) bank deposit liquidity risk is low, (2) the size and relative wealth of the previously unbanked population is large, and (3) CBDC is valuable to households as a means of payment or for credit-building. Even when overall lending decreases, households benefit from the value of using CBDC for payments, plus CBDC provides an alternative “safe” savings vehicle, and it generates greater surplus in lending by reducing credit-risk information asymmetry. If non-banks are part of the “two-tier” CBDC distribution, fewer funds may flow into bank deposit accounts from the unbanked because a bank account is no longer needed for CBDC access. However, if CBDC data is shared with banks, those without bank accounts may still build credit and access lower interest rate loans. This is welfare optimal if the gains from greater access to CBDC outweigh any lending contraction. [Read more at the IMF]

Upcoming conferences, webinars and speaking engagements:

I’ll be on a “public finance and the digital future” panel at the March 23-25 Willamette College of Law “Our Money, Our Future” (Hybrid) Conference in Salem, Oregon on March 24. [Register here]
I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor

Kiffmeister’s #Fintech Daily Digest (20230317)

March 17, 2023 ~ kiffmeister

A practical guide to offline payment security

Lipis Advisors in partnership with Crunchfish published a paper that outlines the key security aspects relating to offline digital currency payments. Unlike other offline payment platforms that operate in various devices’ secure elements, Crunchfish advocates a software-based approach that operates in a virtual secure elements on smartphones . The need for hardware-based digital cash (e.g., on cards, wearables and feature phones) is acknowledged, but as peripheral bearers that need to be able to exchange digital cash with the smartphone as the main bearer, even in full offline-mode. [Read more at Crunchfish and watch related videos and webinars here]

Wholesale central bank digital currency – the safe way to debt capital market efficiency

The European Stability Mechanism (ESM) published a paper that analyzes the usefulness of digital currencies for wholesale financial transactions in Europe. It identifies the risks impede broad adoption of distributed ledger technology (DLT), despite potential widespread debt capital market efficiency gains from DLT-based smart contracts. A wholesale central bank digital currency (CBDC) on a private permissioned blockchain could overcome these risks and impediments and lead to significant efficiency gains in the financial system. [Read more at the ESM]

Digital Africa: Technological transformation for jobs

The World Bank published a report that provides evidence that demonstrates that internet availability increases jobs and reduces poverty in African countries. To fully realize their potential, digital technologies need to become more affordable and easier to use. Governments should prioritize policies and investments that increase internet coverage, foster productive internet use, and enhance skills, jobs, and earnings. [Read more at the World Bank]

The world of open banking

Konsentus updated its open banking infographic/map (H/T Lauren Jones). It shows that nearly 40% of the globe has an active open banking program, and there is a key trend towards regulatory driven initiatives, although the depth and breadth of that regulation is market dependent. Also, Latin America and the Middle East are seeing an increased number of legislative frameworks. [Download the map at Konsentus]

Upcoming conferences, webinars and speaking engagements:

I’ll be on a “public finance and the digital future” panel at the March 23-25 Willamette College of Law “Our Money, Our Future” (Hybrid) Conference in Salem, Oregon on March 24. [Register here]
I’ll be moderating the “CBDCs, Stablecoins, Commercial Bank Money Tokens – What is the Future of Money?” panel discussion at the Digital Euro Association (DEA) Digital Euro Conference on March 31 in Frankfurt. [Register with this link and the DECKIFFMEISTER20 code and get a 20% discount]
I’ll be moderating a panel on “what happens when the lights go out…different schemes for offline functionality” at the in-person Digital Currency Conference (DCC) in Mexico City on May 18. [Register here]

Kiffmeister’s global central bank digital currency monthly monitor