Kiffmeister’s #Fintech Daily Digest (20250702)

July 3, 2025 ~ kiffmeister

A Macroeconomic Model of Remunerated Central Bank Digital Currency (NBER)

The U.S. National Bureau of Research (NBER) published a paper that develops a calibrated New Keynesian DSGE model featuring monopolistic banks to assess the macroeconomic impact of introducing a remunerated central bank digital currency (CBDC). The analysis shows that households gain from enhanced liquidity services and higher deposit interest rates due to reduced bank market power, while banks experience lower profits and lending volumes. Exploring economies across different interest rate regimes, the authors identify significant welfare improvements from remunerated CBDC adoption, especially in economies with high interest rates where banks have substantial market power in deposit markets. They propose a practical CBDC interest-rate setting rule—setting it as the greater of zero and the policy rate minus one percentage point—which closely approximates the optimal rate found in their model. [Read more at the NBER]

Ripple Follows Circle in Bid for US Banking License (Decrypt)

Ripple has filed an application with the Office of the Comptroller of the Currency (OCC) to obtain a national bank charter, following in the footsteps of Circle’s similar application just two days earlier. The application comes as stablecoin issuers prepare for expected regulatory requirements under the GENIUS Act legislation, which recently passed the Senate. Ripple has also filed for a Federal Reserve master account through its Standard Custody subsidiary, which would allow it to hold RLUSD stablecoin reserves directly with the Fed and provide more flexibility for processing digital assets. [Read more at X]

Peter Thiel joins tech billionaires backing new lender Erebor to rival Silicon Valley Bank (FT)

A group of tech billionaires including Palmer Luckey of Anduril and Joe Lonsdale of 8VC are launching Erebor, a new US bank designed to serve the gap left by Silicon Valley Bank’s collapse in 2023. Backed by high-profile investors including Peter Thiel’s Founders Fund, the bank aims to serve tech companies and crypto businesses that traditional banks often reject, with a particular focus on virtual currencies, AI, defense, and manufacturing companies. Erebor has applied for a national bank charter and plans to differentiate itself by working with underserved customers who lack sufficient access to credit, with stablecoin transactions expected to be a significant part of its operations. The bank will be headquartered in Columbus, Ohio, with a New York office, and will operate primarily through digital channels. [Read more at the FT]

Moody’s Brings Credit Ratings Onchain via Solana (CoinTelegraph)

Moody’s partnered with fintech startup Alphaledger in June 2025 to run a pilot program exploring how traditional credit ratings could be integrated into blockchain systems using the Solana network. The experiment involved creating a tokenized municipal bond on Solana, with Moody’s providing a real credit rating that was then pushed directly onto the blockchain via API, making it permanently embedded and publicly viewable as part of the token’s metadata. This allows smart contracts and decentralized applications to automatically query bond ratings without needing external verification, potentially enabling real-time credit assessments, automated compliance, and new forms of programmable financial infrastructure. [Read more at CoinTelegraph]

Upcoming Speaking Engagements:

The CB+DC Conference (Nassau, Bahamas, September 9-11) is a premier gathering centered on CBDCs, tokenized assets, and stablecoins. It provides a forum for central bankers, commercial bankers, technology innovators, policymakers, and academics to explore the latest advancements in digital currency, engage with experts and peers, and discuss the future of digital currency. [Register here but before you do, email me at john@kiffmeister.com for a 15% discount]

And 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 john@kiffmeister.com.

Kiffmeister’s #Fintech Daily Digest (20250701)

July 1, 2025July 1, 2025 ~ kiffmeister

ECB Commits to DLT Settlement Plans with Dual-Track Strategy (ECB)

The European Central Bank (ECB) will follow a dual-track strategy to enable distributed ledger technology (DLT) transaction settlement using central bank money. The “Pontes” track is a short-term solution that will pilot connections between DLT platforms and the Trans-European Automated Real-time Gross Settlement Express Transfer (TARGET) platform by the end of Q3 2026. “Appia” is a long-term approach focused on creating innovative, integrated financial ecosystems, like the “full DLT” solutions tested by the Banque d France” in which settlements were completed using on-chain “exploratory cash tokens” (i.e., wholesale central bank digital currency (CBDC)). This decision builds on the Eurosystem’s 2024 exploratory work involving 64 participants conducting over 50 DLT trials and experiments, the results of which were published along with the announcement of the dual-track strategy. [Read more at the ECB]

Swiss National Bank Extends and Expands Project Helvetia (SNB)

The Swiss National Bank (SNB) is extending and expanding Project Helvetia, which examines various approaches to settling tokenized assets in central bank money, for a further year and continue the pilot until at least mid-2027. (The project was slated to end a two-year extension on June 2026.) Additionally, the SNB is expanding Project Helvetia to include the settlement of tokenized assets with traditional central bank money through a real time gross settlement (RTGS) link, providing BX Digital with a production environment to test this approach alongside the existing wholesale central bank digital currency (CBDC) settlement on the SIX Digital Exchange platform. The extension allows for a direct comparison between the two settlement approaches in a production environment to provide further insights into their respective advantages and disadvantages. [Read more at the SNB]

Robinhood Launches Layer-2 Blockchain for Stock Trading in Europe (CoinTelegraph)

Robinhood launched a tokenization-focused layer-2 blockchain and introducing stock token trading European Union (EU) users. Built on Arbitrum, the new layer-2 network will enable the issuance of over 200 US stock and exchange-traded fund (ETF) tokens, giving European investors access to U.S. assets. Robinhood’s stock tokens will have zero commissions and be available for trading 24 hours a day, five days a week. [Read more at Robinhood]

Paxos Launches Global Dollar USDG in the EU (Ledger Insights)

Paxos has launched its Global Dollar stablecoin (USDG) in the European Union in compliance with local Markets in Crypto-Assets (MiCA) regulations, with initial distributors including Kraken and Gate. The stablecoin operates under a revenue-sharing model where Paxos shares most of the revenues earned on reserves with distribution partners, departing from industry norms. Originally issued under Singapore laws, USDG entered the EU market through Paxos’s acquisition of Finland’s Membrane Finance, which held a MiCA license. The launch highlights the complexity of managing multi-jurisdictional stablecoins, as EU regulations require 30% of reserves to be held as cash in local bank accounts, necessitating a rebalancing process that has drawn criticism from EU parliamentarians who worry about potential regulatory circumvention during crisis situations. [Read more at Paxos]

Circle Applies for National Trust Charter (Circle)

Circle submitted an application to the Office of the Comptroller of the Currency (OCC) to establish a national trust bank, First National Digital Currency Bank, N.A. If approved, the bank would be authorized to operate as a federally regulated trust institution, subject to OCC oversight, and would oversee the management of the USDC Reserve on behalf of Circle’s U.S. issuer. An approval would also further strengthen the infrastructure that supports the issuance and circulation of USDC and would offer digital asset custody services to institutional customers. A federally regulated trust charter would also help Circle meet expected requirements under the proposed GENIUS Act legislation, which would represent a meaningful step forward in integrating digital assets into the broader U.S. financial system. [Read more at Circle]

New Technology and Settlement in Central Bank Money Between Banks (Danmarks Nationalbank)

Danmarks Nationalbank published a paper that examines how distributed ledger technology (DLT) could transform financial market infrastructure while maintaining the critical role of central bank money in interbank settlements. The paper explains that while DLT platforms offer potential benefits like streamlined capital markets, automated smart contracts, and reduced intermediaries, they currently cannot integrate with central bank money systems, creating risks of market fragmentation and reduced monetary policy effectiveness. To address this challenge, central banks are exploring two main approaches: connecting existing central bank systems to DLT platforms through interoperability solutions, or developing new systems where central bank money and digital assets operate on the same DLT platform. The analysis emphasizes that regardless of technological advances, maintaining central bank money as the primary settlement asset is essential for financial stability, and Denmark will collaborate with the European Central Bank (ECB) through the TARGET Services platform to ensure future settlement infrastructure developments benefit the Danish financial system while preserving the unique safety and liquidity properties of central bank money. [Read more at Danmarks Nationalbank]

Upcoming Speaking Engagements:

Kiffmeister’s #Fintech Daily Digest (20250617)

June 17, 2025June 17, 2025 ~ kiffmeister

Retail CBDC Design for Basic Payments Feasibility Study (BOC)

The Bank of Canada (BOC) published a paper that explores the technical architecture for a retail central bank digital currency (CBDC) tailored for basic payments. The authors analyze a micro-partitioned system based on the UTXO (unspent transaction output) funds model, using a two-tiered model based on OpenCBDC 2PC as a representative design. It found that the baseline design handles over 250,000 transactions per second (TPS), though privacy-preserving variants (e.g., Pedersen commitments) reduce performance. Privacy is enhanced by minimizing central bank visibility into user data, with optional anonymity for users. Challenges include integrating with existing retail payment systems, auditing large-scale monetary supplies, and ensuring core system resilience. The study concludes that such architectures are feasible for basic payments but highlights areas needing further research, such as compliance mechanisms and recovery protocols for system outages. [Read more at the BOC]

Coinbase Seeking US SEC Approval to Offer Blockchain-Based Stocks (Reuters)

Coinbase is seeking U.S. Securities and Exchange Commission (SEC) approval to offer tokenized equities. Chief Legal Officer Paul Grewal described the initiative as a “huge priority,” emphasizing the benefits—lower trading costs, faster settlement, and 24/7 access—while acknowledging lingering concerns over liquidity, global standards, and regulatory clarity. To proceed in the U.S., Coinbase must secure a “no-action letter” or similar exemptive relief from the SEC, since it isn’t registered as a broker-dealer. Grewal did not specify whether a formal SEC request had been filed or when the launch might occur, though the move follows rival Kraken’s recent rollout of tokenized U.S. equities outside the United States. [Read more at Reuters]

Upcoming Speaking Engagements:

Kiffmeister’s #Fintech Daily Digest (20250415)

April 15, 2025April 15, 2025 ~ kiffmeister

A formally defined model to describe and compare payment system architectures (BIS)

The Bank for International Settlements (BIS) proposed a formally defined model to represent three key functions of payment system architectures: issuance/withdrawal, holding and transfer of funds in a standardized manner. The model defines payment diagrams, using a precisely defined syntax. The paper illustrates the application of these diagrams for domestic and cross-border account transfers, as well as cash, card, e-money and stablecoin payments. However, the payment diagrams can be used for any type of funds and can be applied across different payment system architectures. It also demonstrates how the diagrams correspond to the balance sheet approach commonly used in economics, and that it offers added value by providing an end-to-end visualization of every stage of the payment journey. The model provides a tool for central banks, regulators and the payment industry to better understand and compare existing and new payment system architectures. [Read more at the BIS]

Fnality rolls out “earmarking” for programmable payments (Fnality)

Fnality has released a new “earmarking” feature that allows banks to program funds for release upon receipt of proof of an event elsewhere. For example, institutions will be able to systematically program when funds move in exchange for a specified asset, or a related market event. A proof is a cryptographically signed piece of data representing specific information from another system, triggering the release of the £FnPS’s digital representation of central bank funds. When an earmark is in place prior to its release, the funds remain on the originating participant’s balance sheet at all times. [Read more at Fnality]

Kiffmeister’s #Fintech Daily Digest (20250118)

January 18, 2025 ~ kiffmeister

The economic limits of cryptocurrencies and blockchains (QJE)

The Quarterly Journal of Economics (QJE) published a paper by Eric Budish that shows that Nakamoto’s form of trust is economically limited. A zero-profit condition on the quantity of honest blockchain “trust support” (work, stake, etc.) and an incentive-compatibility condition on the system’s security against majority attack together imply an equilibrium constraint which says that the “flow” cost of blockchain trust has to be large at all times relative to the benefits of attacking the system. This is extremely expensive relative to traditional forms of trust and scales linearly with the value of attack. However, the paper’s analysis is consistent with the continued use of cryptocurrencies and blockchains for black market purposes, and more generally in use cases where users are willing to pay the high implicit costs of anonymous, decentralized trust. [Read more at the QJE and see also McConnell (2017)]

To be clear, the Budish paper’s critique is of blockchains and permissionless consensus, not of distributed databases with trust grounded in traditional sources. (see Budish and Sunderam (2023) for discussion of the potential value of the blockchain data structure in the context of traditional finance).

Fostering empathy for Canadians facing challenges with digital payment systems (BOC)

The Bank of Canada (BOC) published a paper on designing inclusive and user-friendly digital payment systems, focusing on fostering empathy for and identifying the needs of users who exhibit behaviors that indicate they encounter accessibility or usability barriers in digital systems. Specifically, it examines two types of users based on two common behaviors: users who rely on others to perform tasks and those who avoid interacting with technology. The findings show that individuals in the two groups avoid systems they expect lack usability. Addressing these issues through standard accessibility practices, live assistance and thoughtful interface design can enhance user interaction and trust. For accessibility issues that cannot realistically be eliminated, technology that enhances cooperative relationships and allows account owners to control information sharing is key. [Read more at the BOC]

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Upcoming Speaking Engagements:

The Central Bank Payments Conference (Paris, February 17–19) will explore the latest issues and developments confronting central banks and their evolving role as operators, overseers, and catalysts within the payments landscape. The focus will be on cross-border payments, CBDC and tokenization, open finance, instant payments, and financial inclusion, among other topics. When you register get 15% off by using the Kiffmeister15 code. [r egister here]
The Global Payments Summit (Paris, February 19–21), the second half of Currency Research Payments Week, will explore emerging payments trends and innovations, positioning the ecosystem’s commercial players — banks, PSPs, solution providers — at the center of the discussions. When you register get 15% off by using the Kiffmeister15 code. [register here]
The Digital Euro Conference 2025 (Frankfurt, March 27) will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [register here]

Kiffmeister’s #Fintech Daily Digest (20241213)

December 13, 2024December 13, 2024 ~ kiffmeister

Bank Indonesia completes digital rupiah PoC (BI)

Bank Indonesia (BI) completed its Project Garuda proof of concept (PoC) for a distributed ledger technology (DLT) based digital rupiah wholesale cash ledger. The testing confirmed that the solution can meet the business and technical needs requirements (transaction security, interoperability with existing payment systems and financial infrastructure). Two DLT-based platforms were tested; Corda (R3) and Hyperledger Besu (Kaleido). Both were able to meet all testing scenarios and address all key questions. Project Garuda will proceed with a broader exploration of securities ledger, including exploring liquidity management and privacy technology. [Read more at BI]

Macau pataca prototype system development completed (AMCM)

The Monetary Authority of Macau (AMCM) has completed the development of a prototype digital Macau pataca (e-MOP) which will soon undergo sandbox and public testing. There is also a chance it will be linked to China’s e-CNY and Hong Kong’s e-HKD in the future. The People’s Bank of China (PBOC) provided technical support, and the Hong Kong Monetary Authority (HKMA) is responsible for supervising and managing e-MOP issuance, cancellation and circulation. The AMCM will set up self-service money exchangers to allow holders to accept e-MOP or other foreign currencies for cash reloading by exchanging money. [Read the e-MOP white paper at the AMCM]

AXA IM in two ECB wholesale CBDC trials (Ledger Insights)

AXA Investment Managers (AXA IM) executed two transactions using the Banque de France’s pilot distributed ledger technology (DLT) based wholesale central bank digital currency (CBDC), as part of the Eurosystem wholesale DLT settlement trials. The first was a €3 million investment by AXA IM, on behalf of AXA France, into a digital sovereign bond issued by the Republic of Slovenia. The transaction was executed on BNP Paribas’ “Neobonds” tokenization platform with T+1 settlement on T+1 using the Banque de France’s DL3S platform. The second experiment executed a fund share subscription of €1 million from Generali into AXA Court Terme with instant settlement process using digital CeBM via the IZNES blockchain platform. [Read more at AXA IM]

SocGen completes repo transaction on public blockchain with the Banque de France (SocGen)

Societe Generale (SocGen) completed a collateralized market transaction fully executed on blockchain through its SG-FORGE subsidiary. This is the first sale and repurchase agreement (repo) transaction in digital securities with a Eurosystem central bank. SocGen deposited as collateral with the Banque de France some bonds issued in 2020 on the public Ethereum blockchain in exchange for pilot central bank digital currency (CBDC) issued by the Banque de France on its DL3S blockchain. [Read more at SocGen]

HQLAᵡ and market participants collaborate on collateral mobility initiative (DerivSource)
HQLAᵡ successfully concluded a feasibility initiative to address pain points in triparty collateral mobility. It uses its platform to transfer securities collateral to – or between – multiple triparty agents without triggering cross-custodian settlements. The HQLAᵡ platform uses distributed ledger technology (DLT) to validate the ownership of the securities at any given point in time. [Read more at DerivSource]

EBA assesses potential benefits and challenges of tokenized deposits (EBA)

The European Banking Authority (EBA) published a report to facilitate awareness of tokenized deposits, as well as assess their potential benefits and challenges. The report also aims to promote convergence in the classification of tokenized deposits in contrast with electronic money tokens (EMTs) issued by credit institutions under the Markets in Crypto-Assets Regulation (MiCAR). [Read more at the EBA]

ESAs provide guidelines to facilitate crypto-asset classification consistency (EBA)

Three European Supervisory Authorities (ESAs) published joint guidelines intended to facilitate consistency in the regulatory classification of crypto-assets under MiCAR. The guidelines include a standardized test to promote a common approach to classification as well as templates market participants should use when communicating to supervisors the regulatory classification of crypto-assets. [Read more at the EBA]

Recommendations related to cross-border payment data flows and regulation (FSB)

The Financial Stability Board (FSB) published recommendations to promote greater alignment in data frameworks related to cross-border payments and consistency in the regulation and supervision of bank and non-bank payment service providers. These recommendations advance key actions from the G20 Roadmap to address legal, supervisory, and regulatory issues in cross-border payments. [Read more at the FSB]

Exploring wholesale central bank digital currencies (CCAF)

The Cambridge Centre for Alternative Finance (CCAF) published a report that reviews the case for a wholesale CBDC, the various approaches in how it can be delivered, and an assessment of the pilots and experiments undertaken by the industry and central banks. It finds that buy- and sell-side firms are progressing with tokenization initiatives, driving a need for digital money for the cash leg. which may increasingly be delivered through tokenized bank deposits or stablecoins. Meanwhile, central banks are raising concerns on the risks of using such private settlement assets for settlement, facilitating experiments demonstrating how central bank money can be used instead, but with no clear indication yet on how and when this may be delivered in practice. [Read more at the CCAF]

Digital tool sheds light on stablecoin flows and regulation (CCAF)

Also, the CCAF updated its Cambridge Digital Money Dashboard (CDMD), offering new insights into the geographical flows of stablecoins, as well as regulatory overviews for a wider set of jurisdictions. This new update was made possible through a joint work with Chainalysis, a blockchain data platform specializing in on-chain data analytics for investigations and compliance. [Read more at the CCAF]

ICMA publishes DLT bonds reference guide (ICMA)

The International Capital Market Association (ICMA) published a reference guidance for DLT-based debt securities. The guide highlights considerations for the end-to-end lifecycle of DLT-based debt securities. It is designed for market practitioners as well as a broader audience of market stakeholders. It comprises over 50 practical questions and serves as a reference point across the lifecycle of a DLT-based debt security. [Read more at ICMA]

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Upcoming Speaking Engagements:

Digital Euro Conference 2025, Frankfurt, March 27, 2025. The DEC25 conference will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [Find out more and register here]

Kiffmeister’s #Fintech Daily Digest (20241127)

November 27, 2024November 27, 2024 ~ kiffmeister

Retail CBDC legal and system design considerations (BIS)

The Bank for International Settlements (BIS) published reports on retail central bank digital currency (CBDC) system design and legal considerations. They were written by a group comprised of the BIS and seven central banks (Bank of Canada, the Bank of England, the Bank of Japan, the European Central Bank, the Board of Governors of the Federal Reserve System, Sveriges Riksbank and the Swiss National Bank). The system design paper provides perspectives on overall system design and four key issues: privacy, cyber security (including quantum computing), offline functionality and point of sale considerations. The legal paper examines key legal questions, focusing on four areas: the legal classification of retail CBDC; the obligations and liabilities of participants in the retail CBDC ecosystem; privacy and financial crime and cross-border issues. [Read more at the BIS]

Russian ministry urges 2-year transition period for CBDC (Crypto.News)

The Russian Ministry of Industry and Trade has called for a two-year transition period before making merchant acceptance of digital ruble payments mandatory, citing concerns over unprepared infrastructure. The draft law that would make digital ruble payments mandatory for large retailers by July 2025, which could create serious challenges for those businesses. The Ministry particularly emphasized the need for clear operational guidelines, and additional time to finalize software, update information systems, conduct testing, and train staff. [Read more at Izvestia]

Automated fund administration and transfer agency using smart contracts (Chainlink)

As part of the Monetary Authority of Singapore (MAS) Project Guardian, SBI Digital Markets, UBS Asset Management, and Chainlink completed the implementation of a tokenized fund. They showed how tokenization, smart contracts, and Chainlink infrastructure can automate the fund management process for fund administrators and transfer agents. The pilot demonstrated the possibility for a tokenized fund to maintain its share register on one blockchain while using Chainlink’s Cross-Chain Interoperability Protocol (CCIP) to enable the processing of intensive fund lifecycle activities on another blockchain with different underlying security, cost, and efficiency properties. [Read more at PR Newswire]

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Upcoming Speaking Engagements:

Digital Euro Conference 2025, Frankfurt, March 27, 2025. The DEC25 conference will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [Find out more and register here]

Kiffmeister’s #Fintech Daily Digest (20241112)

November 12, 2024November 12, 2024 ~ kiffmeister

CDC issues €100m digital bond settled with pilot wCBDC (Ledger Insights)

Caisse des Dépôts et Consignations (CDC) issued a €100 million digital bond settled using the Banque de France’s DL3S distributed ledger technology (DLT) platform using its pilot wholesale central bank digital currency (CBDC). The transaction formed part of the European Central Bank’s wholesale distributed ledger technology (DLT) settlement trials. The Banque de France avoids using the term wholesale CBDC, instead referring to it as a tokenized representation of central bank money. For the CDC issuance, it required synchronizing the issuance of the digitally native note (DNN) on Euroclear’s D-FMI platform with the settlement on the central bank’s DL3S. [Read more at Ledger Insights]

Use of DLT and tokenization in financial markets (AFME)

The Association for Financial Markets in Europe (AFME) published a response to a call for submissions from the European Commission (EC) Directorate-General for Financial Stability, Financial Services and Capital Markets Union (DG FISMA) on any issues and opportunities relating to the deployment of DLT based infrastructure and services in the European Union (EU) that may merit the EC’s attention. AFME’s overarching view is that a transformative potential of DLT is that can enable companies and individuals to access a shared, peer-validated database as a single-source-of-truth, without the need to centralize data and transaction processing with a single actor. This increases accessibility by participants, data security and immutability, and data transparency in the real economy. Innovation in finance plays a key role in this vision, which will only begin in earnest with the updating of capital markets infrastructure. [Download the response at the AFME]

JPMorgan renames Onyx blockchain platform to Kinexys (CoinDesk)

JPMorgan (JPM) rebranded its blockchain platform, formerly Onyx, as Kinexys, and its JPM Coin System has been renamed “Kinexys Digital Payments”. The bank also said it plans to introduce on-chain foreign exchange capabilities to the platform as early as the first quarter of 2025, paving the way for the “automation of 24/7, near real-time multicurrency clearing and settlement.” The service will first be available for the U.S. dollar and euro with plans to expand to other currencies. [Read more at JPM]

Sponsored Content:

Upcoming Speaking Engagements:

Digital Euro Conference 2025, Frankfurt, March 27, 2025. The DEC25 conference will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [Find out more and register here]

Kiffmeister’s #Fintech Daily Digest (20241016)

October 16, 2024October 16, 2024 ~ kiffmeister

Project Aperta: enabling cross-border data portability through open finance interoperability (BIS)

The Bank for International Settlements (BIS) launched Project Aperta (Latin for “open”) to explore how to reduce frictions and costs in global finance by enabling seamless cross-border data portability. The project aims to connect the domestic open finance infrastructures of different jurisdictions. The initial exploratory use case is in trade finance for small and medium-sized enterprises (SMEs). Collaborators include the Central Bank of the United Arab Emirates, Banco Central do Brasil, U.K. Financial Conduct Authority , Hong Kong Monetary Authority, and the Global Legal Entity Identifier Foundation. [Read more at the BIS]

ANZ explores stablecoin to track pension payments (Ledger Insights)

The Health Employees Superannuation Trust Australia (HESTA) and ANZ are examining whether the bank’s A$DC stablecoin could allow HESTA to streamline pension payment reconciliation. Currently, HESAT member firms contributing to staff pensions pay the money across and separately send data about what it relates to. ANZ’s idea is for the data to accompany the stablecoin payment as part of a smart contract. This could eliminate the entire reconciliation process and employees would be able to see their contributions in real time. [Read more at Ledger Insights]

ECB exploratory work on new technologies for wholesale central bank money settlement

Last week I reported on a couple of trials that are part of the European Central Bank (ECB) exploratory work on new technologies for wholesale central bank money settlement. It has since come to my attention that there are a couple of places where all of the trials associated with two of the three solutions are tracked. The Deutsche Börse trials of the Banque de France led wholesale central bank digital currency (CBDC) based solutions are listed on its website here. And trials of the Deutsche Bundesbank (BuBa) “trigger solution is tracked on BuBa’s website here. (The trigger solution links distributed ledger technology (DLT) securities settlement platforms operated by the market with the traditional Eurosystem payment system (TARGET) to achieve atomic settlement.

Upcoming Speaking Engagements:

Digital Euro Conference 2025, Frankfurt, March 27, 2025. The DEC25 conference will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [Find out more and register here]

Kiffmeister’s #Fintech Daily Digest (20241012)

October 12, 2024 ~ kiffmeister

CBDCs and financial stability: balance sheet analysis and policy choices (IMF)

The IMF published a paper that analyzes the financial stability implications of retail central bank digital currency (CBDC). It starts with a systematic analysis of balance sheet changes that arise from the new liability for the central bank and the banking system, and examine how they depend on preconditions, central bank choices, and banking system responses. Based on this, it discusses the range of implications for financial stability that may arise in steady state, in the context of adoption, and in crisis times. Threats to financial intermediation in steady state arise mainly in situations where the central bank balance sheet expands, and triggers adjustment mechanisms that lead to more costly or less stable funding of the banking system, while in crisis times run risk may increase. The analysis of policy choices to control these effects considers macroprudential policy, and an expansion of central bank lending to commercial banks, but finds that a main contribution needs to come from a design of the CBDC that encourages its use as a means of payment rather than a store of value. [Read more at the IMF]

First EU DLT Pilot Regime system gets green light: CSD Prague (Ledger Insights)

The Central Securities Depository Prague (CDCP) has become the first institution to get official authorization to launch under the European Securities and Market Authority (ESMA) DLT Pilot Regime. The DLT Pilot Regime provides the legal framework for trading and settlement of transactions in crypto-assets that qualify as financial instruments under European regulation, while facilitating the set-up of new types of market infrastructures. Starting November 18, 2024, CDCP will be able to offer issuers of book-entry securities registration of issues in the newly created distributed ledger technology (DLT) based registry. [Read more at CDCP]

Ripple escalates dispute with SEC, files notice of cross-appeal (Cointelegraph)

In an October 10, 2024 filing in the U.S. District Court for the Southern District of New York, Ripple disclosed plans to take a cross-appeal to the Court of Appeals for the Second Circuit, in its ongoing legal battle with the U.S. Securities and Exchange Commission (SEC). On October 2 the SEC filed an appeal to an August 7 order for Ripple to pay a $125 million civil penalty for violating federal securities laws. The Court of Appeals will review both appeals to determine if any legal or procedural errors were made in the August 7 decision. [Read more at Cointelegraph]

Upcoming Speaking Engagements:

Digital Euro Conference 2025, Frankfurt, March 27, 2025. The DEC25 conference will explore the future of money with a focus on CBDCs, stablecoins, tokenized deposits, and the intersection of AI and digital ID. When you register, get 20% off the regular ticket price by using the Kiffmeister20 code! [Find out more and register here]