Category: Crypto Assets

Kiffmeister’s #Fintech Daily Digest (20230921)*

~ kiffmeister ~ Leave a comment

Emmer’s CBDC Anti-Surveillance State Act passes Financial Services Committee

The US House Financial Services Committee considered Majority Whip Tom Emmer’s CBDC Anti-Surveillance State Act. The bill was passed out of the Committee and reported favorably to the House floor during the markup session, an important step toward passing this legislation through Congress. The Act would prevent the Federal Reserve from issuing a central bank digital currency (CBDC) directly or indirectly to individuals or maintaining accounts on behalf of individuals. It would also prohibit the Secretary of the Treasury from directing the Federal Reserve to issue a CBDC and clarifies that a CBDC can only be issued pursuant to congressional authorization. [Read more on Emmer’s website]

Interestingly, Emmer’s bill does leave the door open for a privacy-preserving digital currency: “this Act and the amendments made by this Act shall not apply to any dollar-denominated currency that is open, permissionless, and private, and fully preserves the privacy protections of United States coins and physical currency.” That could leave the door open for House Representative Stephen Lynch’s ECASH Act that would direct the Secretary of the Treasury (not the Federal Reserve) to develop and pilot digital dollar technologies that replicate the privacy-respecting features of physical cash. [Read the ECASH Act here and the FAQ here]

JP Morgan is part of Regulated Liability Network digital currency project

JP Morgan is participating in the Regulated Liability Network (RLN). Earlier in September 2023, the UK arm of the RLN shared the findings of its latest work without mentioning the participants. The network aims to bring together banks and central banks to support different types of digital currency on the same network. That includes CBDCs, deposit tokens and regulated stablecoins. In July the US RLN published a report involving several other U.S. banks, the New York Federal Reserve’s innovation arm and Mastercard. The premise that underpins the RLN is interoperability so that banks don’t need to use the same type of blockchain to transfer tokens between them. [Read more at Ledger Insights]

R3 lays off a fifth of its employees

R3 has laid off a fifth of its employees as part of cost-cutting drive, blaming tough economic conditions that it says have led the company to shift its focus and business model. According to Bloomberg, the company had laid off just over a fifth of its headcount, affecting the company’s operations globally and across different functions. R3 is based in New York but operates an office in the United Kingdom. While enterprise blockchain technology has gained traction over the years, it remains a slow-moving industry where projects take years. However, these projects have moved slowly while others have been abandoned, leading to lost revenue for R3. [Read more at R3]

PayPal USD (PYUSD) is now available on Venmo

PayPal’s PYUSD dollar-denominated stablecoin is now available on Venmo to select users and will be rolling out fully in the coming weeks. Transfers between PayPal and Venmo users are fast and free, and individuals using compatible external wallets, and merchants accepting payments in PYUSD, will also be able to receive transfers from Venmo users (blockchain network fees apply). Also, PYUSD has been greenlisted by the New York State Department of Financial Services, making it easier for virtual currency entities licensed in New York to support PYUSD. [Read more at PayPal]

BIS and IADB join forces to foster LATAM innovation and financial inclusion

The Bank for International Settlements (BIS) and the Inter-American Development Bank (IDB) are joining forces to explore and develop technology that can help to modernize Latin American and the Caribbean financial systems . The first collaboration will be on Project FuSSE (Fully Scalable Settlement Engine) aiming to design and test backend functionality that can be adapted to multiple types of infrastructures, allowing them to process a growing number of transactions and participants across various types of assets and the number of participants. The technology could support payment systems, security settlement systems or even CBDCs. [Read more at the BIS]

*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]

Kiffmeister’s #Fintech Daily Digest (20230914)*

~ kiffmeister ~ Leave a comment

Franklin Templeton files for Bitcoin ETF

Asset manager Franklin Templeton, which is one of the world’s largest asset managers, filed an application for a spot Bitcoin exchange-traded fund (ETF) with the U.S. Securities and Exchange Commission (SEC) on September 12, 2023. The product would be called “The Franklin Bitcoin ETF” and its shares would be listed and traded on the CBOE BZX Exchange. Coinbase would be the fund’s custodian and surveillance-sharing partner. [Read more at Decrypt]

Fintech funding in Europe stumbles 70% YoY

According to Finch Capital’s 8th Annual State of European Fintech Report, European fintech companies secured only EUR 4.6 billion in funding in H1 2023, versus the EUR 15.8 billion raised during the same period in 2022. The deal count in H1 2023 dropped 48% to 463. The massive drop was mainly driven by a decreased number of mega rounds, a retreat in activity from American investors, and a return to investment fundamentals. [Read more at Finch Capital]

Vanuatu launches VANKLIA, a new national payment system

The Reserve Bank of Vanuatu launched a new national digital payment platform, VANKLIA, to strengthen its digital economy and promote financial inclusion. The VANKLIA system is comprised of a real-time gross settlement (RTGS) component and an automated clearing house (ACH) component which facilitates the clearing of low value, high volume electronic fund transfers for batch payments. [Read more at the International Finance Corporation]

*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]

Kiffmeister’s #Fintech Daily Digest (20230913)*

~ kiffmeister ~ Leave a comment

SWIFT begins beta tests of CBDC connector

SWIFT is working with three central banks and 30 financial institutions on beta tests of an experimental method for interlinking central bank digital currencies (CBDCs) with existing fiat infrastructures. In addition, SWIFT has started a second phase of sandbox testing, with commercial banks, central banks and financial market infrastructures exploring uses such as trigger-based payments for digital trade platforms, foreign exchange models, delivery vs. payment and liquidity saving mechanisms. [Read more at SWIFT]

Telegram integrates TON-based crypto wallet for its 800 million users

Telegram Messenger has reportedly integrated The Open Network-based self-custodial (TON Space) crypto wallet for its over 800 million monthly active users. All Telegram Wallet users can now access TON Space. Telegram Wallet is a bot that allows users to buy and sell crypto. Then, beginning in November 2023, all global Telegram users will be able to access the self-custodial wallet — excluding the U.S. and some other countries. In 2020, Telegram abandoned TON after the US Securities and Exchange Commission (SEC) sued Telegram for raising $1.7 billion through an initial coin offering (ICO) which they claimed was an unregistered security. [Read more at The Block]

World Bank study reveals key Fintech growth enabling factors

The World Bank published a paper that found that countries with less developed and less competitive banking systems exhibit higher levels of Fintech activity, in part explained by lower barriers to entry and more opportunities for digital financial services in such countries. It also found that Fintech activity is positively correlated with capital market development that may reflect a more favorable investment climate that fosters the emergence of fintech companies by providing the funding they need to develop. [Read more at the World Bank]

BCG Global Payments Report 2023

The Boston Consulting group (BCG) published its 2023 Global Payments Report, that takes deep dives into four payments industry subsectors: acquirers, issuers, wholesale transaction banks, and payments infrastructure providers. Total payments revenues grew at an annual rate of 8.3% from 2017 to 2022, taking the revenue pool to $1.6 trillion at the end of 2022. However, revenue growth is expected to slow as the retail payments mix shifts from cards to account-to-account transactions, and card margins shrink in some markets. [Read more at BCG]

*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]

Kiffmeister’s #Fintech Daily Digest (20230912)*

~ kiffmeister ~ Leave a comment

BIS and Israel and HK central banks examine security, privacy and accessibility in CBDC design

Project Sela, a joint experiment conducted by the Bank for International Settlements (BIS) and the Israeli and Hong Kong central banks, showed that a retail central bank digital currency (CBDC) ecosystem can combine accessibility, competition and preventative cyber security, while retaining key advantages of physical cash. In Sela, the retail CBDC ledger is operated by the central bank without compromising end user privacy as personal identifiers are obfuscated. Retail payments are therefore settled directly on the central bank’s balance sheet in a privacy-preserving manner, meaning instant finality for transactions. [Read more at the BIS]

PayPal introduces on and off ramps for Web3 payments

U.S.-based PayPal users can now seamlessly convert their crypto into USD with its new off-ramp service. The company had already been operating an on-ramp service for its customers, allowing them to purchase crypto-assets. Currently, the new service is available to decentralized applications (dApps), wallets, and non-fungible token (NFT) marketplaces and is also available to users on MetaMask. Also Web3 merchants can integrate the new off-ramp service and connect to robust security controls and tools for fraud management, disputes, and chargebacks. [Read more at PayPal]

There are now two types of PayPal dollars, and one is better than the other

Interestingly, JP Koning shows that of the two types of US dollar digital currencies now offered by Pay Pal, its PayPal USD (PYUSD) stablecoins are actually safer than its the traditional account offering. Better quality assets back PYUSD, they are ranked more senior to other creditors if PayPal goes kaput in most states, and they are disclosed more transparently. Notably, PayPal’s regular accounts are regulated piecemeal under each U.S. states’ own peculiar version of a money transmitter license, that can almost always be legally backed by riskier assets, and typically do not require that they be held in trust solely for the benefit of customers. [Read more at Moneyness and the Cornell Law Review]

NIST stablecoin report highlights security and stability concerns

The US National Institute of Standards and Technology (NIST) published a report on stablecoin security considerations. These include unauthorized or arbitrary minting; vulnerability in smart contract codes leading to the theft of the stablecoin’s on-blockchain reserves, the malicious hacking or updating of smart contract codes, denial-of-service attacks on the data oracles that provide the smart contracts with off-blockchain information, and attacks on the underlying blockchain. The stability and trust issues the report identifies vary based upon the stablecoin use case, as well as the kind of marketplace that the stablecoins are traded upon. [Read more at NIST]

*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]

Kiffmeister’s #Fintech Daily Digest (20230910)*

~ kiffmeister ~ Leave a comment

SEC vs. Ripple: Commission urges court To grant appeal request in latest filing

In a new filing submitted on September 8 the Securities & Exchange Commission (SEC) urged the US District Court for the Southern District of New York to certify its motion for interlocutory appeal of the court’s judgment in the lawsuit against Ripple and “stay further proceedings until the resolution of that appeal.” This comes week after the payment technology platform argued that the court should not certify the commission’s interlocutory appeal. [Read more at the CourtListener]

The Palau stablecoin proof of concept reporting mess

On September 7, 2023 I reported that the Palau was wrapping up the first of its US dollar stablecoin (PSC) proof-of-concept (PoC) experiments on September 8, 2023. This was based on an X (formerly Twitter) post by Jay Hunter Anson, Digital Residency Office Director at the Palau Ministry of Finance. Some crypto publications took this to mean that Palau was entirely shutting down the PSC research project so Mr. Anson came back on X to make it clear that the PoC, originally scheduled for 60 days, was actually extended for another 30 days to test some additional use cases discovered along the way, and allow more people to participate.

We can blame the crypto press for not doing proper fact checking, but the Palau government could also do a better job of coordinating its communication. You have to link various X and Facebook posts to get the whole story. For example, an end-July post on the government’s Facebook page said that the PoC was originally scheduled for 90 days starting at the end of July, which would put the 60 day inflection point at the end of September, making the original September 7 post on X sound a bit fishy. Later on the 7th, Mr. Anson filled in the blanks to imply that the 90-day PoC had three phases. The August phase was apparently for live field testing, the September phase will see the completion of retailer redemption, freezing of the August batch of PSC and then the minting of new PSC for another live test in the October phase.

However, the confusion doesn’t end there. There was another post on the government’s Facebook page on September 7 that said that the PoC terminates at the end of September, contradicting the end-July announcement of a 90-day PoC.

All of this is why most governments have dedicated communications staff to coordinate such messages.

*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]

Kiffmeister’s #Fintech Daily Digest (20230908)*

~ kiffmeister ~ Leave a comment

Hong Kong expands trial of China’s digital yuan to more banks

Hong Kong is reportedly actively testing China’s digital yuan and has entered the second phase of technical testing to incorporate a predominant local payment system. The Hong Kong Monetary Authority (HKMA) and the People’s Bank of China (PBOC) have completed the initial technical tests for cross-border payments using the digital yuan in Hong Kong. Currently, they are conducting the second phase of the technical trial, involving more Hong Kong banks and testing the digital yuan wallet’s top-up function through the Faster Payment System. [Read more at The Block]

Circle says its USDC stablecoin was as diversified as possible. Is that accurate?

JP Koning published an article that debunks Circle’s claim that the reserves backing its USDC stablecoin were “as diversified as possible” prior to the collapse of Silicon Valley Bank, in which $3.3 billion (8% of reserves) was held in the form of uninsured deposits. Circle blames banking for its woes, which is “extremely difficult” for crypto firms, but Paxos doesn’t seem to be having the same problem with its USDP stablecoin. $185.5 million were spread over thousands of banks using deposit placement networks like IntraFi, and were thus insured by the government. For the remainder, Paxos obtained $72 million worth private insurance. Only $10.9 million in deposits were effectively unprotected, a small 1.3% sliver of USDP’s total assets. JP askes, rather than keeping 8% of its assets lodged at a second tier bank without insurance, why didn’t Circle follow Paxos’s risk reduction strategy? [Read more at Moneyness]

Fortune magazine published a behind-the-scenes account of Circle’s Silicon Valley Bank (SVB) trials and tribultations. Circle’s management “devised a plan A, B, and C. The first failed when Circle’s attempted wire to get out its deposits didn’t go through. [They] remained optimistic that the government would guarantee its deposits—plan B. In case that didn’t work out, the executives spent the weekend negotiating deals with companies who would buy Circle’s SVB holdings for $0.85 on the dollar, which, along with Circle’s own balance sheet, would be enough to restore USDC’s reserves.” [Read more at Fortune]

IOSCO consults on global DeFi regulation. Targets MEV, developers 

The International Organization of Security Commissions (IOSCO) published a report on the regulation of decentralized finance (DeFi). It makes nine recommendations that include analyzing the DeFi protocol, identifying responsible persons and mapping functionality to existing regulated activities. The proposed recommendations are principles-based and outcomes-focused, and aimed at DeFi products, services, arrangements, and activities by applying IOSCO’s widely accepted  global standards for securities markets regulation. [Read more at IOSCO]

The oracle problem and the future of DeFi

The BIS published a paper on the role of oracles to import real-world data into blockchain-based decentralized finance (DeFi) environments for use in smart contracts. Smart contracts in DeFi rely on accurate reporting of real-world events to function correctly. The oracle problem poses a challenge of incorporating reliable real-world information into DeFi applications while maintaining the core principles of decentralization: trustlessness and no single point of failure. It underscores a notable limitation of DeFi, which requires sacrificing trust in intentions (whether individuals or institutions are fair and ethical) that cannot be fully captured by consensus protocols. This restricts the scope of DeFi to communities that are willing to rely solely on trust in competence. [Read more at the BIS]

*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]

Kiffmeister’s #Fintech Daily Digest (20230907)*

~ kiffmeister ~ 1 Comment

CBDCTracker.org released another update to its central bank digital currency (CBDC) database. [Check it out at CBDCTracker.org and read Atakan Kavuklu’s  summary of the key updates on Medium]

FSB and IMF outline comprehensive approach to identify and respond to macroeconomic and financial stability risks associated with crypto-assets

The Financial Stability Board (FSB) and the IMF published a report outlining a comprehensive policy and regulatory response to crypto-asset activities to address the risks of crypto-assets to macroeconomic and financial stability. To address macroeconomic risks, it says jurisdictions should safeguard monetary sovereignty and strengthen monetary policy frameworks, guard against excessive capital flow volatility and adopt unambiguous tax treatment of crypto-assets. Some authorities might consider bans but they should not substitute for robust macroeconomic policies, credible institutional and monetary policy frameworks, and comprehensive regulation and oversight. [Read more at the FSB] 

Bangko Sentral ng Pilipinas selects technology for CBDC project

​The Bangko Sentral ng Pilipinas (BSP) has selected Hyperledger Fabric as the distributed ledger technology (DLT) for its Project Agila (formerly known as Project CBDCPh) wholesale central bank digital currency (CBDC) sandbox tests. Project Agila aims to orient the BSP and participating financial institutions on CBDC technology solutions that have the potential to enhance the country’s large-value payment system. By the end of Project Agila, the participants are expected to have a clearer understanding of CBDC technology and assess the capability of wholesale CBDCs to foster advancements in the large-value payment system.  [Read more at the BSP]

Palau to freeze USD-backed stablecoin after proof-of-concept launch in July

Palau is wrapping up the first of its US dollar stablecoin (PSC) proof-of-concept (PoC) experiments on September 8, 2023, just over a month after the launch in July 2023 that was slated to run for three months. Following the distribution halt, PSC will also be frozen after September 15, becoming unavailable for spending by users. The government will send a survey to PoC participants, the results of which will be critical to deciding whether to move forward with the next phase of the stablecoin program. [Read more on X]

IMF reports on Saudi Arabia’s CBDC exploration

The IMF in its Saudi Arabia 2023 Article IV staff report reported on the Saudi Central Bank (SAMA) central bank digital currency (CBDC) explorations. Through Project Aber, SAMA was one of the first central banks to experiment with domestic and cross-border wholesale CBDC. Leveraging the lessons of the experiment, SAMA is continuing to explore wholesale CBDC use cases. SAMA is undertaking a three-phased approach (evaluation, testing, implementation), allowing for ongoing assessment at each stage, against which the future roadmap will continue to evolve. [Read more at the IMF] 

FASB says crypto-assets should be marked at current values

The U.S. Financial Accounting Standards Board (FASB) has moved to insist companies use “fair-value” accounting to report their crypto holdings. The accounting rules will be mandatory for all companies for fiscal years beginning after December 15, 2024. However, companies will be allowed to adopt the rules once FASB formally publishes them later in 2023. The crypto assets have to be currently classified as intangible assets, as defined by US accounting rules, and fungible. Stablecoins and wrapped tokens aren’t covered. [Read more at FASB]

*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]

Kiffmeister’s #Fintech Daily Digest (20230906)*

~ kiffmeister ~ Leave a comment

Blockchain privacy and regulatory compliance: towards a practical equilibrium

Ethereum’s Vitalik Buterin has co-authored a paper on a smart contract-based protocol designed to reconcile financial privacy with regulatory compliance. The core idea is to allow users to publish a zero-knowledge proof, demonstrating that their funds (do not) originate from known (un-)lawful sources, without publicly revealing their entire transaction transaction history. This is achieved by proving membership in custom association sets (“privacy pools”) that satisfy certain properties, required by regulation or social consensus.  [Read more on SSRN]

Bank of Canada explores impact of quantum computing on CBDCs

The Bank of Canada has engaged evolutionQ for a research project involving quantum-safe cybersecurity technologies for greenfield digital currencies. The Bank of Canada is exploring technologies and technical ecosystems that may inform decisions relating to the development of a potential digital loonie. The evolutionQ research will explore the impact of integrating quantum-safe encryption methods and crypto-agility as design goals for central bank digital currency (CBDC). The code developed during the research will be released as open source to give developers and researchers the opportunity to explore the new cryptographic methods.  [Read more at evolutionQ]

*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]

Kiffmeister’s #Fintech Daily Digest (20230901)*

~ kiffmeister ~ Leave a comment

SEC delays spot Bitcoin ETF decision for all applicants including BlackRock, Fidelity

The U.S. Securities and Exchange Commission (SEC) has delayed until October making a decision on all of the spot bitcoin exchange-traded fund (ETF) applications filed by applicants including BlackRock, WisdomTree, Invesco Galaxy, Wise Origin, VanEck, Bitwise and Valkyrie Digital Assets earlier this year. The SEC has a total of 240 days from when it first begins its review of the applications to make a final decision to approve or deny. SEC staff have traditionally used every possible comment and review period to delay making final decisions until those 240 days have elapsed. [Read more on the SEC website, making sure to focus on the August 31, 2023 updates]

RBI to add support for NFC to India’s UPI Lite digital wallet service

The Reserve Bank of India (RBI) will add support for near-field communications (NFC) payments to the country’s Unified Payments Interface (UPI) Lite digital wallet, enabling users to conduct transactions on their smartphone when there is no internet or mobile connection. The RBI is adding the option to the stored value wallet, launched in September 2022, to “optimize processing resources for banks, thereby reducing transaction failures”. [Read more at the RBI]

Tether’s stablecoin USDT ‘has a peg stability problem’, claims Kaiko analyst

USDT has a peg stability problem compared to other stablecoins. Its redemption fee and minimum means it’s often rational for USDT holders to sell the token on the market rather than redeem it for USD with Tether. As liquidity has dwindled, the market is no longer able to absorb significant USDT selling. Tether charges a 0.1% fee for fiat withdrawals over $1,000, meaning that USDT is redeemable at $0.99, with the minimum fiat withdrawal or deposit set at $100,000. Another catch is that users have to pay a non-refundable amount of $150 for “verification,” which, according to Tether, “is intended to ensure that only those who are serious about establishing an account apply.” [Read more at Decrypt] 

Enabling offline payment scalability

Lipis Advisors in partnership with Crunchfish released the fifth white paper in the “enabling offline payments in an online world” series. The new paper focuses on scalability, pointing out that the choice of hardware or software-based offline trusted environment can greatly impact the scalability features of offline payment systems. Software-based trusted environments are generally more scalable, because they don’t require the distribution of physical components and may be updated more easily. However, in low-income countries where most potential users can’t afford devices that support software-based trusted environments (i.e., smartphones), some combination of hardware- and software-based trusted environments should be implemented to ensure true scalability. [Read more at Crunchfish]

*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]

Kiffmeister’s #Fintech Daily Digest (20230831)*

~ kiffmeister ~ Leave a comment

SWIFT hails success of blockchain interoperability pilot

SWIFT published the results from a series of experiments that show its infrastructure can seamlessly facilitate the transfer of tokenized value across multiple public and private blockchains. Working with more than a dozen major financial institutions and market infrastructures, SWIFT demonstrated that it can provide a single point of access to multiple networks using existing, secure infrastructure. Chainlink  was used as an enterprise abstraction layer to securely connect the SWIFT network to the Ethereum Sepolia network, while Chainlink’s Cross-Chain Interoperability Protocol enabled complete interoperability between the source and destination blockchains. [Read more at SWIFT]

Binance to ‘gradually’ end support for BUSD products

Binance will “gradually” end support for its BUSD stablecoin, removing it from spot and margin trading pairs. Users have been asked to convert their BUSD into other assets by February next year. Binance is also delisting BUSD as a loanable asset on September 6 and will cease withdrawals of Binance-peg BUSD tokens via BNB Chain, Avalanche, Polygon and Tron on September 7. A decision to end support for BUSD has been expected since BUSD issuer Paxos was ordered to stop minting the coin in February. [Read more at Binance]

The controversial business of cash-to-crypto Bitcoin ATMs

The Kansas City Federal Reserve published an article that surveys the data available on the multi-billion Bitcoin ATM (BTM) industry in the United States and reviews its overall shape and customer base. It finds that the industry continues to grow, with the number of BTMs increasing after the “crypto winter” retrenchment. Despite high fees, consumers seem likely to use them—perhaps for remittances, investment, or both. [Read more at the Kansas City Fed]

*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]