Tag: Custody

Kiffmeister’s #Fintech Daily Digest (20250715)

~ kiffmeister

FSB Chair Makes Stablecoins a Priority Ahead of G20 Meeting (Coindesk)

In a letter to the G20, Financial Stability Board Chair Andrew Bailey called for further attention to be given to assessing the increasing role of stablecoins for payment and settlement purposes, on account of under-explored potential risks, in part due to the pace of market developments. He called for the FSB to continue to ensure that it is implementing its agreed recommendations, monitoring developments in this area and collaborating across jurisdictions and with the standard-setting bodies where relevant. [Read more at the FSB]

U.S. FRB, OCC, FDIC Outline Expectations for Bank Digital Asset Custody (Ledger Insights)

The U.S. Federal Reserve Board (FRB), Office of the Comptroller of the Currency (OCC), and Federal Deposit Insurance Corporation (FDIC) have published a statement outlining their expectations for banks providing crypto custody services. The statement emphasizes the importance of banks having the necessary knowledge and understanding of crypto safekeeping to conduct the activity safely and in compliance with regulations. It also highlights the risks associated with cryptographic keys, legal and compliance risks, and third-party risks, particularly in the case of sub-custodians. This guidance comes after a shift in regulatory policies since President Trump’s second administration, which rolled back the Securities and Exchange Commission (SEC) Staff Accounting Bulletin (SAB) 121 that effectively prevented banks from providing crypto custody. [Read more at the FRB]

Stablecoins Have Long Road to Mainstream Payments, Mastercard Says (Bloomberg)

In an article published on Bloomberg, Mastercard’s chief product officer, Jorn Lambert, says stablecoins have a long way to go before becoming a mainstream payment tool. While stablecoins offer promising attributes like high speed and low costs, they lack essential attributes like a seamless user experience and wide distribution to consumers. Mastercard is positioning itself as a bridge between digital assets and traditional finance, providing infrastructure to make stablecoins usable at scale by leveraging its global network and security safeguards. However, Lambert notes that stablecoin adoption faces significant hurdles, including consumer adoption and friction in online checkout experiences, making it difficult to clear in the near-term. [Read more at Bloomberg]

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 (20250529)

~ kiffmeister

Reserve Bank of India CBDC Pilots Update (RBI)

The Reserve Bank of India (RBI) outlined its 2025–26 plans for its digital rupee central bank digital currency (CBDC) pilots in its 2024-25 Annual Report. In 2024-25 the pilots tested offline and programmable functionalities, including use cases such as direct benefit transfers, agricultural loans, and targeted employee allowances. These pilots have been extended to public schemes, like direct benefit transfers to farmers against generation of carbon credits and loans to tenant farmers in select locations. Looking ahead, discussions are ongoing with central and state agencies to scale programmable CBDC for defined-use fund transfers. Also, the RBI plans to explore both bilateral and multilateral cross-border CBDC pilots, especially given India’s role as a leading remittance recipient. The upcoming agenda also includes testing new designs, technologies, and use cases such as asset tokenization. [Read more at the RBI]

UK FCA seeks further views on stablecoins and crypto custody (UK FCA)

The UK Financial Conduct Authority (FCA) published a consultation paper that outlines a proposed regulatory framework for the issuance of fiat-referenced stablecoins and the custody of qualifying crypto-assets. The framework focuses on establishing clear rules to ensure the stability, transparency, and redemption rights of stablecoins, mandating that issuers back tokens 1:1 with secure, liquid assets held in statutory trust by independent custodians. Custodians must also segregate and safeguard client assets under trust arrangements. The proposals aim to enhance consumer protection, market integrity, and innovation, while aligning with global standards. The FCA plans further consultations on conduct, prudential, and governance standards, and encourages industry feedback by July 31, 2025. [Read more at the UK FCA]

Korea becomes testing ground for CBDC vs stablecoin supremacy battle (Ledger Insights)

Bank of Korea (BOK) Governor Rhee Chang-yong reportedly visited the nation’s six largest banks to advocate for the central bank’s two wholesale central bank digital currency (CBDC) projects, Project Hangang and Project Agorá, offering to cover a third of the costs for Project Hangang. This initiative coincides with these banks’ plans to launch a joint stablecoin, highlighting a competitive landscape between public and private digital currencies. The BOK’s strategy includes leveraging permissioned blockchains for tokenized deposits, contrasting with the banks’ preference for permissionless blockchain-based stablecoins. [Read more at The Korea Times]

Stablecoins and Safe Asset Prices (BIS)

The Bank for International Settlements (BIS) published a paper that examines the impact of dollar-backed stablecoin flows on short-term US Treasury yields using daily data from 2021 to 2025. The results of the empirical analysis suggest that a 2-standard deviation inflow into stablecoins lowers 3-month Treasury yields by 2-2.5 basis points within 10 days, with limited to no spillover effects on longer tenors. It also finds evidence of asymmetric effects: stablecoin outflows raise yields by two to three times as much as inflows lower them. Decomposing the yield impact by issuer shows that USDT (Tether) has the largest contribution followed by USDC (Circle), consistent with their relative size. [Read more at the BIS]

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 (20250124)

~ kiffmeister

Strengthening American leadership in digital financial technology (US White House)

U.S. President Donald Trump signed an Executive Order (XO) “prohibiting the establishment, issuance, circulation, and use of a central bank digital currency (CBDC) within the jurisdiction of the United States” on the grounds that they “threaten the stability of the financial system, individual privacy, and the sovereignty of the United States”. The XO uses the standard BIS (2020) CBDC definition: “a form of digital money or monetary value, denominated in the national unit of account, that is a direct liability of the central bank” which is a bit problematic, because it encompasses both retail and wholesale CBDC. It’s problematic because, by that definition, the Federal Reserve (Fed) is already running a WCBDC in the form of commercial bank reserve and settlement accounts. [Read more at the White House]

Instead, the White House could have followed the language of a bill introduced to the U.S. House of Representatives by Rep. Tom Emmers, the “CBDC Anti-Surveillance State Act“. It starts with the same CBDC definition as the White House XO, but goes on to narrow down the impact of the bill to prohibit the Fed from “offer[ing] products or services directly to an individual; maintain[ing] an account on behalf of an individual; or issu[ing] a central bank digital currency, or any digital asset that is substantially similar under any other name or label, directly to an individual [or] indirectly to an individual through a financial institution or other intermediary… [This] may not be construed to prohibit any dollar-denominated currency that is open, permissionless, and private, and fully preserves the privacy protections of United States coins and physical currency.” [Read the Emmers bill here]

The XO also says that “except to the extent required by law, agencies are hereby prohibited from undertaking any action to establish, issue, or promote CBDCs within the jurisdiction of the United States or abroad.

Trump orders crypto working group to draft new regulations, explore national stockpile (Reuters)

In the same XO, President Trump also ordered the creation of a cryptocurrency working group tasked with proposing new digital asset regulations and exploring the creation of a national cryptocurrency stockpile. The working group will include the Treasury secretary, chairs of the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC), but notably no one from the Federal Reserve or Federal Deposit Insurance Corporation (FDIC) . The XO also ordered that banking services for crypto companies be protected, alluding to industry claims that the Fed and FDIC have directed lenders to cut crypto companies off from banking services.

SEC rescinds SAB 121 freeing banks to provide digital asset custody (Ledger Insights)

The U.S. Securities and Exchange Commission (SEC) rescinded Staff Accounting Bulletin (SAB) 121, which required companies to put digital assets under custody as an asset and a liability on their balance sheet. Usually, as common sense would suggest, these such assets don’t go on the balance sheet because they belong to the client. This rule is especially problematic for U.S. banks because they are subject to capital requirements based on their balance sheet. The SEC had been exempting some banks from this requirement, but only for very specific assets. [Read more at the SEC]

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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. [register 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]

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 (20240829)

~ kiffmeister

Malawi central bank to launch a CBDC proof of concept (RBM)

The Reserve Bank of Malawi (RBM) is looking to engage a consultant to further its central bank digital currency (CBDC) proof of concept work. The initiative aims at exploring the feasibility, benefits and challenges associated with the implementation of a CBDC in Malawi. [Read more at the RBM]

Assessing the implications of a Dominican Republic retail CBDC (IMF)

The International Monetary Fund (IMF) published a technical assistance report that helped the Banco Central de la República Dominicana (BCRD) to assess a CBDC’s potential macro-financial, legal, and financial integrity implications, and shared lessons from other countries’ CBDC and digital money projects, technology considerations, practices for stakeholder engagement, and how CBDC can increase financial inclusion, among others. The mission advised the BCRD to continue the exploration of macro-financial implications of a CBDC, conduct the legal framework revisions should a positive decision of CBDC be taken, assess risks to financial integrity once a firmer design choice is made, and build up technology knowledge and capacity meanwhile. [Read more at the IMF]

Novel risks, mitigants and uncertainties with permissionless DLT (BCBS)

The Basel Committee on Banking Supervision (BCBS) published a working paper on the various risks faced by banks that transact on permissionless blockchains or similar distributed ledger technologies (DLTs). Certain risks stem from the blockchain’s reliance on unknown or third parties, which makes it difficult for banks to conduct due diligence and oversight. These risks require new risk management strategies and safeguards. The paper finds that current practices for mitigating these risks remain in various stages of development and have not been tested under stress. [Read more at the Bank for International Settlements]

ECB hosting a digital euro design focus session (ECB)

The European Central Bank (ECB) is hosting a virtual digital euro design focus session on September 9, 2024. The “digital euro design for the European payments market” is a technical forum aimed at payment service providers and professionals from the financial sector with an interest in the design of the digital euro and its impact on the European payments market. The entire focus session will be live streamed, recorded and published on the ECB’s website shortly after the event, together with the slides presented. [Read more at the ECB]

WFE sets out crypto-asset custody provider good practice (WFE)

The World Federation of Exchanges (WFE) published good practice recommendations for crypto-asset custody providers. These include segregating client assets to ensure they are protected in the event of a company’s bankruptcy, ensuring client assets remain bankruptcy-remote, having adequate insurance and/or surety bonds and disclose these policies in clear understandable terms, and seeking independent audits from reputable and credible auditors to provide an assessment of financial statements, process and controls. [Read more at the WFE]

Upcoming Speaking Engagements:

  • Intertribal Foreign Affairs Council Forum 2024, Yidindji, August 30-31. The conference will bring together indigenous nations to showcase the excellence of their governance practices and generate new ideas for the future. I’ll be on a panel focused on the future of money and indigenous financial inclusion. [Find out more and register here]
  • CBDC Conference, Istanbul, September 10-12. The conference will offer representatives of central banks, commercial banks, technology providers, policy makers and academics the perfect platform to learn about the latest CBDC developments, exchange ideas with experts and peers. [Find out more and register here][Central bank delegates may be eligible for free registration (email registration@cbdc-conference.com to find out more)]
  • Digital Currency Conference, London, September 23-24. The conference will bring together policymakers, regulators, and technology and innovation experts to network and discuss all aspects of digital currencies. And enter the KiffmeisterDCC code at registration to get a 20% discount! [Find out more and register here]

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 (20240712)

~ kiffmeister

House fails to override Biden’s veto on nullifying SEC crypto rule (Coin Telegraph)

The U.S. House of Representatives could not gather enough support to override President Joe Biden’s veto of a resolution affecting a Securities and Exchange Commission (SEC) rule on banks recording cryptocurrency held in custody for customers as a liability on their balance sheets. In a July 11 vote, 228 House members voted to override President Biden’s veto of H.J.Res. 109, overturning SEC Staff Accounting Bulletin (SAB) No. 121 — 60 votes short of the two-thirds majority required. However, Rep. Maxine Waters (D-Calif.) said the SEC has been negotiating with banking industry representatives about “targeted modifications” to the policy and “may be close to reaching an agreement.” [Read more at Coin Telegraph]

Upcoming Speaking Engagements:

  • CBDC Conference, Istanbul, September 10-12. The conference will offer representatives of central banks, commercial banks, technology providers, policy makers and academics the perfect platform to learn about the latest CBDC developments, exchange ideas with experts and peers. [Find out more and register here][Central bank delegates may be eligible for free registration (email registration@cbdc-conference.com to find out more)]
  • Digital Currency Conference, London, September 23-24. The conference will bring together policymakers, regulators, and technology and innovation experts to network and discuss all aspects of digital currencies. And enter the KiffmeisterDCC code at registration to get a 20% discount! [Find out more and register here]

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 (20240403)

~ kiffmeister

The CBDCTracker.org central bank digital currency (CBDC) database has been updated for developments in March 2024. Check out Atakan Kavuklu’s blog for a complete rundown of the March developments.

Project Agorá: Exploring tokenized commercial bank deposits

The Bank for International Settlements (BIS) together with seven central banks will explore how tokenization of wholesale central bank money (i.e., wholesale CBDC) and commercial bank deposits on programmable platforms can improve the monetary system. Project Agorá’s primary area of exploration will be to increase the speed and integrity of international payments, while lowering costs by building on the BIS’s proposed unified ledger concept. The BIS will issue a call for expressions of interest to private financial institutions, with the Institute of International Finance (IIF) acting as the intermediary and convener, to join the project. [Read more at the BIS]

CBDCs: Consumer attitudes and expectations in the United States

The Federal Reserve Bank of Philadelphia conducted a survey in October 2022 in which it asked consumers about their interest in retail central bank digital currency (CBDC). 52.6% of respondents said they would possibly use a digital dollar, but widespread consumer adoption will require that the product does not require fees to access or use (63.5% of respondents who would possibly use a digital dollar), be accepted widely in the marketplace (57.3%), provides high levels of security and privacy for consumers (42.0%), and bear interest (39.2%). At the same time, not all consumers were confident they could render an opinion about a CBDC. [Read more at the Philadelphia Fed]

Bank of England and UK Financial Conduct Authority propose Digital Securities Sandbox

The Bank of England (BoE) and U.K. Financial Conduct Authority published a consultation paper proposing to implement and operate a Digital Securities Sandbox (DSS). The DSS will allow firms to use developing technology, such as distributed ledger technology (DLT), in the issuance, trading and settlement of securities such as shares and bonds. Firms that successfully apply for the DSS will be able to operate under a set of rules and regulations that has been modified to facilitate this. The DSS lasts for five years and will help regulators design a permanent technology friendly regime for the securities market. [Read more at the BoE]

MAS introduces new crypto regulations, including digital asset custody

The Monetary Authority of Singapore (MAS) has introduced cryptocurrency-related amendments to the Payment Services Act, focusing on digital payment token (DPT) service providers, including guidelines for digital asset custody. Under the new guidance, customers’ digital assets held in trust must be segregated from the assets of the service provider, and at least 90% of customer assets must be stored offline in cold wallets. The guidelines also mandate that service providers prevent retail customers from engaging in activities like pledging, lending, or staking their digital assets. [Read more at the MAS]

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 (20240301)*

~ kiffmeister

Hong Kong to broaden e-CNY pilot in move to boost cross-border payment efficiency

The Hong Kong Monetary Authority (HKMA) plans to expand its central bank digital currency (CBDC) testing to allow Hong Kong residents to open and top up digital yuan (e-CNY) wallets through the existing local fast payment system. Phase 1 of the pilot program, which ended in October 2023, involved domestic e-HKD retail use cases in areas like programmable and offline payments, and tokenized deposits. [Read more at the HKMA]

Congressional Committee rejects SEC rule blocking bank digital asset custody

The U.S. House Financial Services Committee passed a resolution to reject the Securities and Exchange Commission Staff Accounting Bulletin (SAB) 121 accounting rule. The resolution will be binding once the full House and Senate approve it. SAB 121 requires companies to put digital assets held in custody on their balance sheet as both an asset and liability. Because bank regulations base capital requirements on their balance sheet, digital asset custody is made prohibitively expensive. [Read more at Ledger Insights]

Bank Indonesia Still Testing Digital Rupiah

Bank Indonesia (BI) is reportedly continuing its digital rupiah but it is still in the conceptual design stage or proof of concept, and will not likely be launched this year (2024). [Read more at Kontan]

*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]