Banco do Brasil selects G+D to test offline payments for CBDC [Misleading news!]
“Banco do Brasil is to work with German firm Giesecke+Devrient (G+D) to test offline payments as part of pilot trials of the Drex central banking digital currency (CBDC)“. At this point you may be thinking that we’re talking about the central bank, Banco Central do Brasil (BCB). However, Banco do Brasil is a commercial bank that purports to be part of the BCB’s Drex pilot. It may be true that this offline payment test is done with the BCB’s blessing, but the press release could make that clearer. [Read more at Banco do Brasil]
HKMA launches stablecoin issuer sandbox arrangement
The Hong Kong Monetary Authority (HKMA) launched its stablecoin issuer sandbox. Tying in with the consultation on the legislative proposal for implementing the regulatory regime for stablecoin issuers, the HKMA wishes to leverage the sandbox arrangement to communicate supervisory expectations to parties interested in issuing fiat-referenced stablecoins in Hong Kong, as well as to obtain feedback from participants on the proposed regulatory requirements. The list of participants of the sandbox arrangement will be available on the HKMA website. [Read more at the HKMA]
EBA launches consultation on stablecoin redemption guidelines
The European Banking Authority (EBA) has initiated a consultation on the guidelines for the orderly redemption of asset-referenced or e-money tokens in the event that the issuer fails to fulfil its obligations under the Markets in Crypto assets Regulation (MiCAR). For example, the draft guideline calls for the clarification of the main principles governing the redemption and distribution plan, such as the equitable treatment of token holders, and describe the main steps for the orderly and timely implementation of the plan. [Read more at the EBA]
Tokenization of financial assets
Xavier Lavayssière posted a paper that provides an interdisciplinary analysis of asset tokenization to clarify the concept and its effect. The paper identifies three key elements; (i) the link between a token and its underlying asset, (ii) the characteristics of the token and its infrastructures where their essential properties, sharedness and trust-minimization, rather than specific technologies, are established, and (iii) the representation of ownership, with new models of custodianship and identification. The paper also discusses the new roles for the various market participants, from register operators, legal advisors, auditors, and underlying platform operators. Also it covers the challenges that tokenization presents, including issues around privacy, technical security, and redefining concepts of ownership, transfer, finality, and interoperability. [Read more at SSRN]
*For those interested in intra-day updates, check out my searchable Diigo Fintech developments database, which is also a good place to go to query for past developments: https://www.diigo.com/user/kiffmeister/ART.
Kiffmeister’s 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 (only) if you work at a central bank, ministry of finance or international financial institution (e.g., the BIS, IMF, OECD, World Bank) and 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]