Tag: smartcontracts

Kiffmeister’s #Fintech Daily Digest (20260212)

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European Parliament Votes for Online and Offline Digital Euro (Central Banking)

On February 10, 2025 the European Union (EU) Parliament has approved the digital euro initiative, reaching agreement with the European Council on creating a currency that will function both online and offline. They rejected an earlier proposal by the parliamentary rapporteur that would have restricted the digital euro to an offline version only (420 votes in favor, 158 against and 64 abstentions). Members of Parliament approved an amendment that stated that the central bank digital currency (CBDC) was “essential to strengthen EU monetary sovereignty, reduce fragmentation in retail payments, and support the integrity and resilience of the single market [as] the increasing digitalization of payments, if left exclusively to private and non-EU actors, risks creating new forms of exclusion for both users and merchants” (438 in favor, 158 against and 44 abstentions). [Central Banking and European Parliament]

Bank Negara Launches Digital Ringgit Pilot Programs (BNM)

Bank Negara Malaysia (BNM) announced that its Digital Asset Innovation Hub (DAIH) has onboarded three initiatives in 2026 to test real-world applications of ringgit stablecoins and tokenized deposits, focusing on wholesale payment use cases for domestic and cross-border transactions, including tokenized asset settlement. These initiatives will be conducted in a controlled environment with ecosystem partners, including corporate clients and other regulators, with some exploring Shariah-related considerations. The testing aims to assess monetary and financial stability implications, with BNM planning to provide clearer policy direction on ringgit stablecoins and tokenized deposits by end-2026, potentially integrating with existing wholesale central bank digital currency (CBDC) work. [BNM]

Programming Money Without Programmable Money (FRBNY)

The Federal Reserve Bank of New York published a staff report that examines the distinction between “programmable money” and “programmable payments” in the context of central bank digital currency (CBDC) and tokenized money systems. The authors propose a two-layer framework consisting of an “asset layer” (a ledger recording ownership of plain-vanilla money) and a “program layer” (instructions for conditional transfers), which issues “certificates” that can be classified by two properties: transferability (whether ownership can be transferred) and convertibility (whether the certificate releases basic money when conditions are met). Pure programmable money is defined as transferable but non-convertible certificates that could circulate perpetually without releasing basic money, while pure programmable payments are non-transferable but convertible certificates (like direct debit arrangements). However, programmable money would likely not satisfy the “no questions asked” (NQA) property needed for good money and therefore wouldn’t circulate widely as money. [FRBNY]

Upcoming Speaking Engagements:

The Digital Euro Conference 2026 (Frankfurt, March 26) will explore the future of money with a focus on CBDCs, stablecoins, and commercial bank tokens. This hybrid event offers the perfect platform to understand the future of digital money! [Register here and get 20% off the regular ticket price by using the Kiffmeister20 code!]

I produce a monthly digest of digital fiat currency (DFC) developments exclusively for the official sector (e.g., central banks, ministries of finance and international financial institution (e.g., the BIS, IMF, OECD, World Bank)) plus academics and firms that are active in the DFC space (commercial banks, technology providers, consultants, etc.). (DFCs include central bank digital currency (CBDC), stablecoins and tokenized deposits.) It goes out via email on the first business day of every month, and if you’re interested in being on the mailing list, please email me at john@kiffmeister.com.

Kiffmeister’s #Fintech Daily Digest (20250415)

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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]

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 (20241103)

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The Digital Shekel Challenge – La Finale (Bank of Israel)

The Bank of Israel (BOI) concluded its Digital Shekel Challenge with presentations by the 14 entities selected to develop innovative use cases for the digital shekel. The use cases presented demonstrated the potential of the digital shekel to help create advanced payment solutions and lead innovation in Israel’s payment system. First place was awarded to Siara for a platform for returning debtors to an economic growth path, second went to Paypal for a smart payroll payments system, third to IDEMIA for an offline payments solution, and the “People’s Choice” to QEDIT for a platform that enhances trust for digital transactions using advanced cryptography. [Read more at the BOI]

Digital money and finance: a critical review of terminology (LinkedIn)

A couple of European Central Bank (ECB) staffers, including Director General of Market Infrastructures and Payments Ulrich Bindseil, posted a paper that proposes a new approach to clarifying the essence of new payment technologies. It puts forward an etymology of key concepts and reviews terminology and definitions, in the hope of facilitating ongoing discussions about the eventual merits of, and use cases for, such technology. On the basis of the analysis, the paper identifies a number of issues with the emerging key digital payments and decentralized financed (DeFi) vocabulary, including central bank digital currency (CBDC), crypto-assets, smart contracts, stablecoins, tokenization, and wholesale (as used in the CBDC context). [Download the paper on SSRN]

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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]

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 (20240903)

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Ripple to add smart contracts to XRP Ledger (Cointelegraph)

Ripple will add smart contracts to the XRP Ledger (XRPL) developer ecosystem and XRPL mainnet, although it’s still in its research phase and the firm did not provide a definite time frame for deployment. It also invited programmers familiar with Ethereum virtual machine (EVM) languages to explore possibilities on its sidechain. Ripple also said the sidechain was created for developers using Ethereum-based smart contracts. This gives a familiar environment for deploying DApps, allowing them to use Solidity, a programming language used to build smart contracts on Ethereum. [Read more at Ripple]

CBDCs, payment firms, and geopolitics (NBER)

The U.S. National Bureau of Economic Research (NBER) published a paper that analyzes the effect of a major central bank digital currency (CBDC) – the digital euro – on the payment industry, finding “remarkably” heterogeneous effects. Stock prices of U.S. payment firms decrease, while stock prices of European payment firms increase in response to positive announcements on the digital euro. Bank stocks do not react. The results are consistent with the notion that the development of the digital euro is driven by a desire for strategic autonomy in payments, pointing to a novel geopolitical dimension of CBDCs. [Read more at the NBER]

Russia’s largest bank to start offering customers CBDC in 2025 (Crypto.news)

Russia‘s Sberbank plans to start operations with the country’s digital ruble for its customers in early 2025. Sberbank is among Russian banks expected to join the project in the second round of testing CBDC, along with about 20 other financial institutions. [Read more at the Moscow Times]

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 (20240614)

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2023 BIS survey on central bank digital currencies and crypto

94% of the 86 central banks surveyed (between October 2023 and January 2024) by the Bank for International Settlements (BIS) are exploring central bank digital currency (CBDC). 54% are experimenting with proofs of concept and 31% are running a pilot. Around 30% of central banks focus on retail CBDCs only and 2% are working on wholesale CBDCs only, and it is more likely that central banks will issue a wholesale CBDC within the next six years than retail CBDC. More emerging market and developing economy (EMDE) central banks are likely to issue a retail CBDC on a distributed ledger than advanced economy (AE) central banks, perhaps reflecting a willingness to leapfrog moving from legacy systems to cutting-edge technologies. Also, this year the survey also provides insight into the use of stablecoins for payments and regulatory approaches to crypto-assets across the globe. [Read more at the BIS]

European Central Bank on making the digital euro truly private

The European Central Bank (ECB) published a blog post that explains what degrees of payments privacy future users of a digital euro can expect. It claims that it will promise better privacy and data protection than other current electronic means of payment, but not the same degree of privacy as cash although paying with an “offline digital euro” comes pretty close. Online digital euro payments will not be so private, because the commercial banks that run the user-facing parts of the platform will have full access to user identity and transaction information, just like they currently do on their own platforms. However, digital euro holder identities will be separated from the payment data, and the banks will pseudonymize user data so they are not visible to the Eurosystem. [Read more at the ECB]

Bank of Thailand to test programmable payments in enhanced sandbox

The Bank of Thailand (BoT) will test programmable payments in its Enhanced Regulatory Sandbox. Programmable payments automate transaction with predefined conditions for the payment of goods and services. This project will demonstrate the potential for applying technology to a wide variety of financial services, accompanied by appropriate risk management processes. The BOT will work in collaboration with the Securities and Exchange Commission, the Office of Insurance Commission, and the Fiscal Policy Office, Ministry of Finance, to evaluate the benefits and risks of financial innovations and to establish potential and suitable supervisory policies. [Read more at the BOT]

Are CBDCs quantum safe?

BitMint CEO Amnon Samid argues that CBDCs that rely on blockchain or distributed-ledger tech (DLT) will soon be cryptographically compromised by the power of quantum computers and artificial intelligence. Amnon argues that central banks should secure digital cash as token- or value-based digital representations, instead of designing systems that rely on traditional accounts as used by the commercial banking system. [Podcast on DigFin]

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 (20231124)*

~ kiffmeister

Kazakhstan central bank pilots digital tenge smart contracts

Binur Zhalenov, CEO of the National Bank of Kazakhstan National Payments Corporation, has described a pilot that uses digital tenge smart contracts to optimize government subsidies, in this case involving school canteen subsidies. Each school student in the city of Almaty has an “ONAY!” transportation card. When a student uses this card in the school canteen, a smart contract is triggered that transfers digital tenge from the school’s account directly to the canteen operator’s account, but only when the student actually receives the service. This significantly cuts down on unnecessary reporting, canteens receive funds instantly after providing services, and ensures clear visibility of government fund usage. [Read more on LinkedIn]

China debuts solar power industry digital yuan smart contracts

State Grid Suzhou Power Supply Company completed the first digital yuan smart contract transaction in the solar power industry. The deal was struck the CBDC with the materials and textiles firm Suzhou Shicheng Material Technology that had struck a smart contract loan-type financing deal with a local bank branch. After Suzhou Shicheng Material Technology used electricity over an agreed period, State Grid Suzhou Power Supply issued a bill, causing the contract to close, and Suzhou Shicheng Material Technology’s digital yuan wallet was automatically debited after the issuance of the bill. [Read more at Cryptonews]

FYI here are some of my upcoming speaking engagements:

– Currency Research Americas Cash Cycle & Payments Seminar (Orlando Florida on November 27-30)[Register here]

– Digital Euro Conference 2024 (Frankfurt on February 29)[Register here]

*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 (20231005)*

~ kiffmeister

Bank of Canada: Central banks will face unfamiliar challenges to achieve CBDC inclusivity

The Bank of Canada published a paper that explores quantitative and qualitative information about Canadians who face barriers to making digital payments, and implications for a potential central bank digital currency (CBDC). It identified three types of inclusion necessary for a universally accessible payment method: financial inclusion, digital inclusion and practical accessibility. The challenge is in the delivery of services rather than product design, and private financial institutions may not be incentivized to address the needs of those who are underserved. However, overcoming those challenges will require central banks to face problems that would otherwise be considered far from their scope of interest. [Read more at the Bank of Canada]

Project Mandala: shaping the future of cross-border payments compliance

The Bank for International Settlements (BIS) and the central banks of Australia, Korea, Malaysia and Singapore launched Project Mandala, which explores the feasibility of encoding policy and regulatory requirements into a common protocol for cross-border use cases such as foreign direct investment, borrowing and payments. It aims to ease the policy and regulatory compliance burden by automating compliance procedures, providing real-time transaction monitoring and increasing transparency and visibility around country-specific policies. [Read more at the BIS]

Hong Kong Stock Exchange launches settlement platform powered by smart contracts

Hong Kong Exchanges and Clearing Limited (HKEX) is launching “Synapse,” a platform that will utilize smart contracts to streamline post-trade flows and enhance operational efficiencies. It will be deployed on Stock Connect, an HKEX channel that enables international investors to access more than 1,000 mainland Chinese stocks through routing in Hong Kong. HKEX will be linked to Hong Kong’s Depository Trust and Clearing Corporation through its Institutional Trade Processing service, allowing for the central matching of cross-border transactions. Settlement instructions are then automatically generated and sent back to the Synapse platform, thus enhancing the trade confirmation workflow. [Read more at Coin Telegraph]

Project Atlas: mapping the world of decentralized finance

The BIS Innovation Hub, De Nederlandsche Bank and the Deutsche Bundesbank jointly launched Project Atlas, which creates a data platform that sheds light on the macroeconomic relevance of crypto-asset markets and decentralized finance (DeFi). A first proof of concept of Project Atlas was developed focusing on international flows of crypto-assets. The initial findings indicate that, although relatively small compared with total on-chain network traffic, identified flows between crypto exchanges are significant and substantial economically. Attributing geographical areas to exchanges (where possible) lays out the structure of cross-border flows. Thus, Project Atlas provides a starting point for structural analysis across jurisdictions. [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 (20221005)

~ kiffmeister

The Book of [Blockchain, Crypto and Web3] Jargon

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

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

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

Privacy in cross-border digital currency: A transatlantic approach

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

Smart Contracts Could Improve Efficiency And Transparency In Financial Transactions

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

Tickets available for CBDC Think Tank masterclass

The CBDC Think Tank, in partnership with the IMF and George Washington University, is hosting a full-day in-person CBDC Masterclass on October 12 in Washington DC for “official sector” staff and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) Digital Currency Lecture Series, a set of digital currency lightning talks delivered by subject matter experts, on October 14 in Washington DC. [Request an invite here]

Kiffmeister’s Global Central Bank Digital Currency Monthly Monitor

Just a reminder that I produce a monthly digest of central bank digital currency (CBDC) developments exclusively for the official sector. So for any of you out there who work for a central bank, ministry of finance or international financial institution who would like to receive it by email on the first business day of every month, please DM me on LinkedIn or email me at chronicles@kiffmeister.com.

Kiffmeister’s #Fintech Daily Digest (20220918)

~ kiffmeister

BIS Innovation Center at the NY Fed is looking into wholesale CBDC

Project Cedar, which is being run out of the BIS Innovation Center at the New York Fed, is looking into wholesale central bank digital currency (CBDC) from a research standpoint. It’s led by Per von Zelowitz, and what they’re trying to do, according to the Boston Fed’s Robert Bench, is “understand what are the requirements, or what are the things they need to think about, for the obligations of New York, which is the world’s leading capital market center?” Thanks to the Atlantic Council’s Josh Lipsky for bringing this to my attention.  [Read more at the Atlanta Fed]

Bullet train: New tokens and platforms may transform cross-border payments

A few weeks ago the IMF’s Finance & Development magazine published an article by Tobias Adrian and Tommaso Mancini-Griffoli that pitched the idea of a multi wholesale CBDC platform to achieve greater cross border payment efficiencies. The IMF will soon publish two papers on these topics that will lay out an initial blueprint for such platforms. This concept is also being pursued by the BIS Innovation Hub Hong Kong Centre’s Project mCBDC Bridge, along with the Hong Kong Monetary Authority, Bank of Thailand, People’s Bank of China and Central Bank of the United Arab Emirates. [Read more at the IMF]

Central Bank Digital Currencies – The Quest for Public Digital Payment Infrastructures

This paper by Xavier Lavayssière summarizes the many considerations that go into the decision as to whether a central bank should issue CBDC and the many design dimensions. The decision-making process raises fundamental questions about the functions of central banks, the roles of the public and private sectors, technological design and international monetary competition that will be defining for the payment industry, economic development and sovereignty. [Download at Blockchain@X]

The Demand for Programmable Payments

This paper Charles Kahn and Maarten van Oordt studies the desirability of programmable payments where transfers are automatically executed conditional upon preset objective criteria. They do so in a framework that captures a wide range of economic relationships between two parties, in an environment without legal recourse. They find that optimal payment arrangements for long-term economic relationships consist predominantly of simple direct payments. Programmable payments will be desirable, and may in fact be the only viable payment arrangement, in situations where economic relationships are of a short duration. [Read more at SSRN]

 

Tickets available for CBDC Think Tank masterclass

The CBDC Think Tank, in partnership with the IMF and George Washington University, is hosting a full-day in-person CBDC Masterclass on October 12 in Washington DC for “official sector” staff and academics active in the CBDC / digital currency space only. The sessions are designed as instructional deep dives with full presentations and Q&A components.  Tickets are $99. [Register here]

Also, the CBDC Think Tank, in partnership with Georgetown University and the DC FinTech Week, is hosting a FREE (also in-person) Digital Currency Lecture Series, a set of digital currency lightning talks delivered by subject matter experts, on October 14 in Washington DC. [Request an invite here]

Kiffmeister’s Global Central Bank Digital Currency Monthly Monitor

Just a reminder that I produce a monthly digest of central bank digital currency (CBDC) developments exclusively for the official sector. So for any of you out there who work for a central bank, ministry of finance or international financial institution who would like to receive it by email on the first business day of every month, please DM me on LinkedIn or email me at chronicles@kiffmeister.com.

Kiffmeister’s #Fintech Daily Digest (02/27/2022)*

~ kiffmeister

What’s the marketing strategy for the Fed’s CBDC?

JP Koning wonders whether the U.S. Fed has a central bank digital currency (CBDC) marketing pitch beyond that it is safer than other forms of money (“free from credit risk and liquidity risk”). He argues that “safe” is something that Americans already have with commercial bank money thanks to deposit insurance. And because the Fed is going with an “intermediated” model, users will still have to deal with (and probably pay fees to) the same old banks and other payment service providers. [Read more]

Central bank digital currencies risk becoming a gigantic flop

Peter Bofinger and Thomas Haas made a similar argument a year ago with respect to advanced economy countries more generally – i.e., where a large share of the population have access to government-insured bank accounts. However, they concede that a supranational CBDC with multi-currency operability and an openness to payment objects that are not system-specific, may be a worthwhile response to monopolistic or oligopolistic global retail payment networks such as PayPal. [Read more]

BOJ on track for digital currency roll-out

The Bank of Jamaica (BOJ) is reportedly still on track for the roll-out of its JAM-DEX central bank digital currency (CBDC) during the first quarter of 2022. The remaining steps include the passage of amendments to the Bank of Jamaica Act to make CBDC legal tender and the BOJ the sole issuer, and increasing the number of deposit-taking institutions onboarding clients. Also, launch awaits an independent third-party quality assurance assessment of the system, the results of which will be made public. [Read more]

New European Commission Data Act aims for more control over smart contracts

The European Commission has released its proposal for the union’s new Data Act. Among other things, it would mandate that applications using smart contracts include “internal functions which can reset or instruct the contract to stop or interrupt the operation to avoid future (accidental) executions.” Fears are being expressed that such “kill switches” could threaten the promise of immutability because, with the ability of a single source to make a change, the contract is no longer autonomous. [Read more]