Kiffmeister’s #Fintech Daily Digest (20221006)

Central Bank Digital Currency (CBDC): identifying appropriate policy goals and design for Nepal

Nepal Rastra Bank (NRB) published a concept report on central bank digital currency (CBDC) for public consultation. The report recommends that the NRB move forward in with CBDC issuance plans, with design focusing on four policy goals; improving access to payments, enhancing payment system resilience, reducing currency management costs, and promoting financial inclusion. It suggests that a retail, intermediated, semi-centralized infrastructure-based CBDC that is interoperable with other domestic payment systems, is most suitable for Nepal. Also, it should be unremunerated, available 24/7 hours, quantity restrictive, and programmable for broader usage options. The next steps is to set up a cross-functional dedicated team, to carry out the exhaustive and rigorous next steps. [Read more at the NRB]

Archetypes for a retail central bank digital currency

The Bank of Canada published a paper that proposes a common framework to analyze and compare the different possible CBDC designs, independent of vendor, platform and technology. It is based on five archetypes—common patterns that recur in system designs—and discuss their trade-offs from the perspective of privacy, compliance, visibility, scalability, resilience, extensibility, online and offline payments. The five archetypes are centralized, leaderless, macro-partitioned (money service businesses (MSBs) own and operate partitions), micro-partitioned (users maintain the different partitions) and direct (users directly provide their own oversight). The analysis suggests that a design based on a single archetype is unlikely to achieve all policy goals. [Read more at the Bank of Canada]

Europe finalizes landmark crypto rules

The Council of the European Union Permanent Representatives Committee approved the legal text for its  Markets in Crypto Asset Regulation (MiCA), marking a significant step in the journey towards a fully authorized and regulated crypto-asset market in Europe. The European Parliament’s Committee on Economic and Monetary Affairs will now vote to pass the final text on October 10, before a date is decided for the implementation of the regulation. [Read more at the Council of the European Union]

IMF releases the 2022 financial access survey results

The International Monetary Fund released the results of the 13th annual Financial Access Survey which presents the 2021 data and highlights the continued expansion in the use of digital financial services—considerably higher than pre-pandemic levels. The usage of digital financial services has also increased, with the value of mobile money transactions growing from about 40% of GDP to 70% in low-income countries, and the value of mobile and internet banking transactions increasing from 225% of GDP to 324% in middle-income countries between 2019 to 2021. [Read more at the IMF]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20221005)

The Book of [Blockchain, Crypto and Web3] Jargon

Latham & Watkins LLP has published a very helpful interactive glossary of acronyms, slang, and blockchain, crypto and Web3 industry terminology. [Download at Latham & Watkins LLP]

SWIFT innovation paves way for global use of CBDCs and tokenized assets

SWIFT, working with Capgemini, has shown that central bank digital currencies (CBDCs) and tokenized assets can move seamlessly on existing financial infrastructure. The findings, from two separate experiments, bridged transactions between different distributed ledger technology (DLT) platforms (JPMorgan Quorum and R3 Corda) and real-time gross settlement systems. However, it appears that it still uses intermediaries for cross border payments, and and intermediaries are a significant cause of friction in the payment system. Fourteen banks will be involved in further experiments to scale the system. [Read more at SWIFT]

Privacy in cross-border digital currency: A transatlantic approach

The Atlantic Council published an article illustrating how various technical design choices can affect the privacy and transparency of cross-border CBDCs. Many of the cross-border CBDC pilot studies to date have adopted the technical designs provided by enterprise DLT platforms. However, some of these designs make tradeoffs regarding privacy, efficiency, and/or security. Whether these tradeoffs are acceptable is a matter of policy, and requires coordination between different regulators and central banks. [Read more at the Atlantic Council]

Smart Contracts Could Improve Efficiency And Transparency In Financial Transactions

S&P Global has published a smart contract explainer. Using smart contracts in financial transactions can improve efficiency and reduce reliance on third parties like asset servicers and custodians, as well as make transaction resolutions faster–enhancing creditworthiness and the integrity of business dealings. However, smart contracts have had slow and limited adoption in the financial markets owing to key risks including technology issues (such as incorrect coding) and legal and regulatory ambiguities that make accountability difficult. [Read more at S&P Global]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20221004)

Financial Stability Oversight Council Releases Report on Digital Asset Financial Stability Risks and Regulation

The Financial Stability Oversight Council (FSOC) released its report on the financial stability risks and regulatory gaps posed by various types of digital assets and provides recommendations to address such risks. To address regulatory gaps, the FSOC recommends the passage of legislation providing for rulemaking authority for federal financial regulators over the spot market for crypto-assets that are not securities; steps to address regulatory arbitrage including coordination, legislation regarding risks posed by stablecoins, legislation relating to regulators’ authorities to have visibility into, and otherwise supervise, the activities of all of the affiliates and subsidiaries of crypto-asset entities, and appropriate service provider regulation; and study of potential vertical integration by crypto-asset firms. [Read more at the FSOC]

Mastercard launches new crypto fraud protection tool

Mastercard is launching Crypto Secure to help banks assess the risk of crime associated with crypto merchants on its network. The service, powered by Mastercard-owned blockchain security startup CipherTrace, combines applies artificial intelligence to blockchain data and public records of crypto transactions, along with other sources, to determine crime-related risks of crypto exchanges within the Mastercard network. On the Crypto Secure platform, banks and other card issuers are shown a dashboard with color-coded ratings representing the risk of suspicious activity, with severity of risk ranging from red for “high” to green for “low.” [Read more at CNBC]

Fraud and scams are becoming more commonplace on P2P payment service Zelle

According to a report by from the office of U.S. Senator Elizabeth Warren, fraud and scams are a growing problem on peer-to-peer (P2P) payment service Zelle, and the banks that run the platform are not refunding the vast majority of defrauded consumers, breaking their promises to their customers and potentially violating federal law. A response by the industry acknowledged that Zelle,  like every instant P2P payment service, is not entirely free from those who seek to defraud users, but expanding the bank liability framework would have adverse impacts on consumers choice, the cost of the service, and on small financial institutions for whom the costs related to the potential for unlimited liability would be too onerous. [Read more at Quartz]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20221003)

Tether Increases US Treasury Portfolio, Cuts Commercial Paper Holdings to Below $50M

Tether has cut its commercial paper holding to less than $50 million, as of September 30, and increased its holding of U.S. Treasuries to 58.1% of its total portfolio from 43.5% of its total portfolio as of June 30, according to a Tweet by its Chief Technology Officer, Paolo Ardoino. [Read more at CoinDesk]

Bigtech regulation: in search of a new framework

The Bank for International Settlements (BIS) published a paper on two potential Bigtech regulatory models. The first is segregation, which is a structural approach that seeks to minimize risks arising from group interdependencies between financial and non-financial activities by imposing specific ring-fencing rules. The second is inclusion, that creates a new regulatory category for Bigtech groups with significant financial activities. The paper concludes that the inclusion approach provides for a more tailored option to address specific risks associated with Bigtech business models. [Read more at the BIS]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220930)

Towards CBDCs in Asia and the Pacific: Results of a Regional Survey

The IMF published a Fintech Note that, drawing on survey responses from 34 Asian economies and country case studies, takes stock of recent developments related to central bank digital currencies (CBDCs) and crypto-assets in Asia. The survey finds that there is significant heterogeneity in terms of stage of development, but the emergence of private crypto assets has created an impetus to consider CBDCs. While most countries are engaged in research and development, with some at advanced stages of testing and pilots, very few countries are likely to issue CBDCs in the near-to-medium term, reflecting the still considerable uncertainties. Still, country experiences so far provide some key insights for others in their journey in this area. [Download at the IMF]

Importantly for my CBDC tracking, the IMF report confirmed that Laos, Fiji, Vanuatu, Solomon Islands and Tonga are conducting CBDS feasibility studies with Soramitsu, a Japan-based private-sector technology platform provider. Here are the specifics:

Banks’ Crypto Asset Holdings May Be Just 0.01% of Total Risk Exposure, Basel Study Finds

The world’s largest banks are exposed to about 9.4 billion euros of crypto-assets, a study by the Basel Committee on Banking Supervision (BCBS) found. The exposure, mainly client services involving bitcoin (BTC) and ether (ETH), represents 0.14% of the total exposure to risk from the 19 banks who sent in data. Exposures are distributed unevenly across reporting banks, with two banks making up 53% of overall crypto-asset exposures, and four more making up 39% of the remaining exposures. [Read more at the BIS]

The “CBDC Design Trilemma

The Digital Euro Association [DEA] published a blog on a CBDC design trilemma. The “Blockchain Trilemma”, is a term used to describe the challenge of increasing performance, security, and decentralization at the same time. Current enterprise blockchains are not truly decentralised. They may be structurally decentralised, but are operationally centralised. By reversing this, having structurally centralised, but operationally decentralised architecture, a CBDC can achieve a high-performance blockchain. However, any blockchain-based CBDC should not only solve the blockchain trilemma, but also the CBDC design trilemma, which notes that identity, privacy, and programmability cannot be easily enhanced at the same time. A CBDC cannot ignore privacy for the sake of achieving legal compliance and implementing programmable money. From an expertise point of view, the answer to this trilemma is the use of a decentralized identity system such as self-sovereign identity (SSID) to find the perfect equilibrium for the CBDC design trilemma. Self-sovereign identity is very popular for its advanced privacy protection. By having an SSID-based blockchain system, a CBDC can incorporate both privacy and transparency into the blockchain-based CBDC system. Additionally, a use of zero-knowledge encryption to protect the transaction privacy of blockchain data is highly recommended for any CBDC implementation. [Read more at the DEA]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220929)

ECB provides update on its digital euro work

The European Central Bank (ECB) provided a status report on its central bank digital currency (CBDC) work. It confirmed that a digital euro would incorporate individual user holding limits to slow the possible conversion of bank deposits into digital euro  (disintermediation risk). A digital euro would also bear interest calibrated to make digital holdings above a certain threshold unattractive compared to other highly liquid low-risk assets.  Offline payments will only be allowed for low value, low risk, close proximity transactions. [Read the report here] In addition, ECB board member Fabio Panetta set out a plan for a digital euro scheme involving a set of rules, practices and standards with plans to start working on a rulebook. [Read the plan here]

Digital Currency: Yuan comes with an expiry date: Spend or it will vanish

China is reportedly exploring putting expiration dates on its e-CNY retail CBDC, which could force holders to use it up by a certain date. This idea has most recently been explored in a Celo working paper that advocated using expiration dates to increase the “velocity” of money, based on an an unconventional monetary policy instrument known as a Gesell money. [Read more at the Economic Times]

Bank of England: FMI Sandbox will start with DLT securities post trade

The Bank of England announced that the U.K.’s Financial Market Infrastructure (FMI) Sandbox would initially focus on distributed ledger technology (DLT) based securities settlement systems. The Sandbox is a joint initiative between HM Treasury, the Bank of England and the Financial Conduct Authority. [Read more at the Bank of England]

ERC-20R and ERC-721R: Reversible Transactions on Ethereum

This paper proposes reversible versions of ERC-20 and ERC-721, whereby a transaction is eligible for reversal for a short period of time after it has been posted on chain. After the dispute period has elapsed, the transaction can no longer be reversed. Within the short dispute period, a sender can request to reverse a transaction by convincing a decentralized set of judges to first freeze the disputed assets, and then later convincing them to reverse the transaction. The paper provides a prototype implementation. [Read more at arxiv.org]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220928)

Project Icebreaker: Central banks of Israel, Norway and Sweden team up with the BIS to explore retail CBDC for international payments

The Bank for International Settlements (BIS) and the central banks of Israel, Norway and Sweden are launching Project Icebreaker, a joint exploration of how central bank digital currencies (CBDCs) can be used for international retail and remittance payments. using a hub-and-spoke model. The project will run through the end of the year, with a final report expected in the first quarter of 2023. [Read more at the BIS]

CBDC pilots and research, lessons for the digital euro

The Digital Euro Association published a very nice summary of the current state of play in the CBDC space. It’s part of a series of articles, this first one providing a general overview of global CBDC projects, motivations, with a particular focus on the Bahamas, China, Eastern Caribbean Union, Nigeria and Russia. Subsequent articles in this series will provide a deeper understanding of CBDC research and development in countries with different challenges and policy objectives. The articles will highlight that there is no one-size-fits-all approach to CBDC, but that CBDC solutions must be based on the needs and challenges of each country. [Read more at the DEA]

ESMA not planning blockchain securities rule changes before DLT pilot regime starts

The European Securities and Markets Authority (ESMA) says there is no need for new regulatory technical standards before the start of the European Union’s distributed ledger technology (DLT) pilot regime in March 2023. The regime aims to reduce the regulatory burden to enable blockchain-based securities trading and settlement to be trialed at scale and provide legal certainty. Tokenized stocks, bonds and investment funds fall within the DLT Pilot regime and have monetary limits. [Read more at Ledger Insights]

FCA green lights Revolut, making no UK crypto firms operating under temporary status

The UK Financial Conduct Authority (FCA) has added crypto-friendly payments app Revolut to its list of companies authorized to offer crypto products and services in the country. Revolut was among a small number of entities granted an extension to the FCA’s temporary cryptocurrency licensing program in March 2022. It was the last company on this list as other applicants withdrew their requests, were refused registration, or had their licenses granted before the end of June. [Read more at CoinTelegraph]

France’s CBDC Projects to Manage DeFi Liquidity, Settle Tokenized Assets

The Banque de France announced two new wholesale CBDC projects. The first will look at improving CBDC market liquidity management in decentralized finance (DeFi), such as via automated market makers. The second will focus on issuing and distributing tokenized bonds on a blockchain. [Read more at the Banque de France]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220926)

Australian CBDC Pilot for Digital Finance Innovation

The Reserve Bank of Australia (RBA) and the Digital Finance Cooperative Research Centre (DFCRC) published a white paper that explains in detail the objectives and approach of their eAUD central bank digital currency (CBDC) project. They also invited interested industry participants to make submissions on CBDC use cases, and offered participants the chance to express interest in operating their use case in a pilot (or proof of concept?) project to test and demonstrate the value proposition. The DFCRC will develop and install the eAUD platform as a private, permissioned Ethereum (Quorum) implementation, and the eAUD ledger will operate as a centralised platform, under the management and oversight of the RBA. [Read more at the RBA]

Nomura invests in Fnality institutional blockchain payments platform

Nomura is investing in Fnality, the interbank payment and settlement platform that uses “synthetic” wholesale CBDC to settle transactions on distributed ledger technology (DLT) based financial market infrastructures (FMIs). (A “synthetic CBDC” is essentially a stablecoin backed by central bank deposits.) Fnality reportedly says it will launch its first such synthetic CBDC in October 2022, pegged to the British Pound (GBP) and backed by deposits at the Bank of England. [Read more at Ledger Insights]

Demystifying wholesale central bank digital currency

According to European Central Bank (ECB) executive board member Fabio Panetta, the ECB is looking at the potential of DLT in improving the efficiency of interbank settlements. However, after listing the many benefits of DLT, Panetta highlighted some drawbacks, and made a case for a system that builds on the ECB’s existing infrastructure for wholesale settlements, instead of building a new one based entirely on DLT. [Read more at the ECB]

DTCC’s DLT stock settlement system live in parallel production

In August the Depository Trust & Clearing Corporation (DTCC) DLT-based Project Ion platform for stock settlement went into production. The R3 Corda-based platform runs in parallel with the DTC’s classic settlement system, which remains the definitive record. At this stage, Project Ion is designed to only deal with bilateral equity transactions but is already processing an average of 100,000 transactions per day. [Read more at DTCC]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220925)

I’ve updated my tabulation of retail central bank digital currency (CBDC) explorers; just minor updates and link repairs. [Click here]

How the US can regulate stablecoins now without congressional action

The Brookings Institution published a paper that proposes a US federal framework for the issuance of stablecoins within the existing regulatory framework for insured depository institutions, a structure that would not require any new legislation. Under current law, the Comptroller of the Currency could authorize a national trust bank charter, organized as an operating subsidiary of an insured depository institution, to create stablecoins through the use of a dedicated trust vehicle. The Comptroller would adopt standards limiting the investment of stablecoin reserves to high quality liquid assets and address redemptions and operational resilience, among other matters. The proposed framework guarantees that holders of a failed stablecoin are paid out rapidly and in full, because it uses the same resolution process by which failed banks are wound up. [Read more at Brookings]

Financial Inclusion and Central Bank Digital Currency in The Bahamas

The Central Bank of the Bahamas (CBOB) published a paper that attempts to assess the introduction of CBDC in the Bahamas. It uses a theoretical model that assumes that CBDC will lead to a decrease in the number of unbanked. As these individuals acquire access to financial institutions, the fraction of hand-to-mouth agents in the economy falls. If the number of unbanked individuals is cut in half, the economic benefits include: a reduction in the volatility of all shocks; monetary policy is more effective at controlling inflation and contributes less to the volatility of the overall economy; fiscal policy becomes more Ricardian, mitigating the size of fiscal shocks. [Read more at the CBOB]

Privacy and Central Bank Digital Currency in the Digital Economy

A paper written by European Central Bank staff studies how the choice of payment instruments affects privacy and welfare in the digital economy. Cash allows merchants to preserve their anonymity but cannot be used for online transactions that generate higher sales. Bank deposits can be used online but do not preserve anonymity. Payment tokens issued by digital platforms allow merchants to hide from the bank but also enable platforms to stifle competition. However, a CBDC that allows agents to share their payment data with selected parties can overcome all frictions and achieve efficient allocation. [Read more at SUERF]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.

Kiffmeister’s #Fintech Daily Digest (20220924)

What’s next for DAOs? Breaking down the CFTC’s latest enforcement action

The Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Ooki DAO in the U.S. District Court for the Northern District of California. The complaint alleged that the Decentralized Autonomous Organization (DAO) was an unincorporated association involved in unlawful activity. This complaint has broad implications for the crypto industry. There are now 2,276 DAOs, which control about $10 billion of crypto in a wide array of blockchain-based financial tools. [Read more at]

PBOC to expand e-CNY trials to four entire provinces

The People’s Bank of China (PBOC) will reportedly expand its e-CNY trials to Guangdong, Jiangsu, Hebei and Sichuan provinces. Deputy Governor Fan Yifei, reportedly said the number of users, merchants and transactions is “steadily growing”, but he did not provide details. [Read more at the South China Morning Post]

Bitcoin was almost named Netcoin by Satoshi Nakamoto

Historical data of domain name purchases suggest that Satoshi Nakamoto, the creator of Bitcoin (BTC), had an alternate naming option in mind that did not make it to the whitepaper. Bitcoin.org, the website domain linked to the original Bitcoin, was created on August 18, 2008, a day after the creation of Netcoin.org using the same registrar. [Read more at CoinTelegraph]

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 and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) 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.