DFC

More
Basel Committee publishes final disclosure framework for banks' cryptoasset exposures and targeted amendments to its cryptoasset standard
Basel Committee publishes final disclosure framework for banks' cryptoasset exposures and targeted amendments to its cryptoasset standard
The Basel Committee on Banking Supervision published its final disclosure framework for banks' crypto-asset exposures and targeted amendments to its crypto-asset standard published in December 2022. The disclosure framework includes a set of standardized tables and templates covering banks' crypto-asset exposures to enhance information availability and support market discipline. The targeted amendments include clarified criteria for stablecoins to receive a preferential regulatory treatment. https://www.ledgerinsights.com/basel-crypto-rules-receive-minor-updates-no-permissionless-blockchain-changes/
#Fintech#CryptoAssets#Stablecoins#Regulation#BIS#DFC
·bis.org·
Basel Committee publishes final disclosure framework for banks' cryptoasset exposures and targeted amendments to its cryptoasset standard
Taiwan to test CBDC prototype via 'digital voucher' system
Taiwan to test CBDC prototype via 'digital voucher' system
Taiwan’s Central Bank of the Republic of China (CBRC) reportedly may start testing a CBDC prototype in collaboration with the Ministry of Digital Affairs “digital voucher” system at the end of 2024 or early 2025. The Taiwanese government has previously issued stimulus vouchers to boost consumption. In the planned pilot, the Ministry would oversee voucher distribution, while the central bank would manage the subsequent payment and settlement operations after users spend the digital vouchers from their wallets. A local media source said that the digital voucher system could commence testing in August and go live in October. The CBDC prototype would not employ blockchain or smart contracts. https://ivod.ly.gov.tw/Play/Full/1M/16085
#Fintech#CBDC#Taiwan#DFC
·theblock.co·
Taiwan to test CBDC prototype via 'digital voucher' system
The Role of Public Money in the Digital Age
The Role of Public Money in the Digital Age
The Bank of Canada (BOC) published a paper that argues that there is now and will continue to be a fundamental need for a relevant retail public money (cash or central bank digital currency (CBDC)) as part of a well-functioning monetary system in which public and private money coexist and complement each other while trading at par, allowing money to move back and forth safely and efficiently. The paper posits that increasing demand for digital payments and the declining use of cash could lead to a loss of the uniformity of money, adoption of alternative units of account and exclusion of some segments of the population. This could lead to frictions and potential abuse of market power by private money providers that could reduce the efficiency of the economy. Also, to perform its interlinking function, retail public money needs to be a viable payment option and a practical mechanism to transfer between private forms of money. The paper argues that a properly designed CBDC would help fill the gap and maintain the relevance of a retail public money in the economy.
#Fintech#CBDC#Canada#DFC
·bankofcanada.ca·
The Role of Public Money in the Digital Age
What stablecoins can learn from history's currency pegs
What stablecoins can learn from history's currency pegs
The challenges faced by stablecoins are not entirely new – a deep dive into 334 historical currency pegs – when a country's central bank or government fixes the exchange rate for its currency – since 1800 reveals valuable lessons. Our analysis of this unique dataset covering more than 300 currency pegs since 1800 found that only 14% of currency pegs survived, with the median lifespan of failed or discontinued pegs ranging from 8-10 years. Among the remaining 51%, 30% were stopped, 6% joined the euro system and only 14% survived. Successful pegs were more often found in smaller, autocratic nations or oil-exporting economies with robust financial backing.
#Fintech#CryptoAssets#Stablecoins#DFC
·weforum.org·
What stablecoins can learn from history's currency pegs
Central bank money settlement of wholesale transactions
Central bank money settlement of wholesale transactions
"This article discusses the rationale for the Eurosystem exploring central bank money settlement of transactions registered on DLT platforms, the results of its analysis so far and the envisaged next steps. Section 2 provides background on the role of central bank money in the settlement of wholesale financial transactions. Section 3 discusses market developments regarding the use of new technologies, such as DLT, for wholesale financial transactions. Section 4 discusses the implications of a potential market uptake of DLT for the Eurosystem’s wholesale central bank money settlement infrastructures. Section 5 outlines the Eurosystem’s plans to further explore how wholesale financial transactions recorded on DLT platforms could be settled in central bank money."
#Fintech#wCBDC#CBDC#Settlement#ECB#DLT#DFC
·ecb.europa.eu·
Central bank money settlement of wholesale transactions
Digital shekel launch unlikely ahead of other advanced economy countries
Digital shekel launch unlikely ahead of other advanced economy countries
The Bank of Israel (BOI) remains committed to plans for a digital shekel currency to improve Israel's payments system and foster innovation, but is unlikely to launch one ahead of other advanced economies, according to Deputy Governor Andrew Abir. He wants an eventual central bank digital currency (CBDC) to pay interest to create competition with bank deposits and provide an incentive for the public to hold it. It will operate in a two-tier model, with a wide range of participants providing services on the digital shekel platform, including banks, plus other payment companies, fintech or Bigtech companies, consumer clubs, and retail entities. Participants will support regular payment use cases, plus advanced and innovative use cases. https://www.boi.org.il/en/communication-and-publications/speeches-and-presentations/9-7-2024en/
#Fintech#CBDC#Israel#DFC
·reuters.com·
Digital shekel launch unlikely ahead of other advanced economy countries
Visa showcases tokenized deposits with HSBC, Hang Seng Bank
Visa showcases tokenized deposits with HSBC, Hang Seng Bank
Visa published a report on its tokenized deposit trial with HSBC and Hang Seng Bank, which involved (i) settling high value real estate transaction and (ii) settling Visa card payments. In Hong Kong there are restrictions on faster payment amounts, so the real estate transaction supported a high value instant payment with tokenized deposits. With tokenized deposits, when a payee transfers money to a recipient, the sending bank burns the tokens and the recipient bank mints them so they appear in the recipient’s wallet. Instant settlement is facilitated by wholesale CBDC, with the token and CBDC exchanges happening simultaneously, so there’s no settlement risk. https://usa.visa.com/content/dam/VCOM/regional/na/us/Solutions/documents/e-hkd-and-the-future-of-global-money-movement.pdf?linkId=492498536
#Fintech#DepositTokens#CBDC#wCBDC#HongKong#VISA#DFC
·ledgerinsights.com·
Visa showcases tokenized deposits with HSBC, Hang Seng Bank
Potential climate impact of retail CBDC models
Potential climate impact of retail CBDC models
Sveriges Riksbank published a paper that analyses central bank digital currency (CBDC) electricity consumption compared to existing retail payment services. Findings indicate that the energy use per transaction of an e-krona is comparable to that of card payments. However, there are significant differences depending on whether the design of the infrastructure for the e-krona is centralized or decentralized, where a centralized solution tend to be less energy consuming than a decentralized solution. Algorand's proof-of-stake public-permissioned network was chosen to represent the decentralized platform, and Hedera's private-permissioned network the centralized platform, and the transactions volumes were assumed to be similar to that of cash-based transactions.
#Fintech#CBDC#Climate#Sweden#DFC
·riksbank.se·
Potential climate impact of retail CBDC models
Taiwan central bank says no rush for CBDC launch
Taiwan central bank says no rush for CBDC launch
The President of the Central Bank of the Republic of China (CBRC), Yang Chin-long, said that developing a central bank digital currency (CBDC) is not a competition and that the central bank is focused on steady progress over speed. Yang said the central bank is conducting experiments in three scenarios to enhance domestic payment efficiency and innovation, retail and wholesale CBDC and the application of tokenization technology to digitally transform wholesale CBDC and commercial bank currency, supporting various asset tokens. The CBRC is also conducting proofs-of-concept and collaborating with participating banks to build a common platform for tokenization. https://www.cbc.gov.tw/tw/cp-302-170834-8653d-1.html
#Fintech#CBDC#wCBDC#Tokenization#Taiwan#DFC
·cointelegraph.com·
Taiwan central bank says no rush for CBDC launch
MiCAR's Influence on Stablecoins: Industry Insights and Implications
MiCAR's Influence on Stablecoins: Industry Insights and Implications
The Digital Euro Association (DEA) published a paper that dissects the Markets in Crypto-Assets Regulation (MiCAR) and its transformative impact on the stablecoin landscape. It explores the diverse regulatory approaches to stablecoins across major jurisdictions and how MiCAR might serve as a model for global regulation. The paper discusses the potential market opportunities MiCAR offers for stablecoin issuers, including enhanced consumer trust, clearer regulatory guidance, and increased access to the European market. Also, it covers the significant challenges stablecoin issuers face under MiCAR, from stringent compliance requirements to operational and technological strains, and how these hurdles might impact smaller issuers and market dynamics.
#Fintech#CryptoAssets#Stablecoins#Regulation#Europe#DFC
·blog.digital-euro-association.de·
MiCAR's Influence on Stablecoins: Industry Insights and Implications
Monetary Devolution and the Political Economy of CBDCs
Monetary Devolution and the Political Economy of CBDCs
According to a paper by Leonidas Zelmanovitz and Bruno Meyerhof Salama, retail central bank digital currency (CBDC) can be considered a form of "monetary devolution," that shifts the power, at least in part, from commercial banks to central banks. They discuss the institutional incentives of digital currencies in general and monetary devolution in the United States in particular. Next they outline an alternative that incorporates the technological edge provided by CBDCs. This alternative would be the creation of wholesale CBDCs to serve as the monetary base for settling retail payments with stablecoins. Designed as such, CBDCs could preserve the current balance between private and public money.
#Fintech#CBDC#DFC
·papers.ssrn.com·
Monetary Devolution and the Political Economy of CBDCs
The facts about MiCA stablecoin caps
The facts about MiCA stablecoin caps
The EU is saying if you want to use stablecoins to buy crypto and do DeFi stuff, have at it. But if you want to use stablecoins to pay for goods and services like your coffee or your rent, then you need to use Euro (or other EU currency) stablecoins. The limits are really about monetary sovereignty.
#Fintech#CryptoAssets#Stablecoins#Regulation#Europe#DFC
·ledgerinsights.com·
The facts about MiCA stablecoin caps
SocGen Forge awarded e-money license for EURCV stablecoin
SocGen Forge awarded e-money license for EURCV stablecoin
Societe Generale – Forge was awarded an Electronic Money Institution (EMI) license by France’s Autorité de Contrôle Prudentiel et de Résolution (ACPR), making its EURCV stablecoin compliant with the EU Markets in Crypto-Assets (MiCA) regulations that came into force on June 30, 2024. To date there hasn’t been a huge amount of EURCV activity. The current EURCV balance is €11.1 million, with one wallet holding a €10.3 million balance and Bitstamp just under €600,000. https://www.sgforge.com/stablecoin-elevation/
#Fintech#CryptoAssets#Stablecoins#France#Europe#Regulation#DFC
·ledgerinsights.com·
SocGen Forge awarded e-money license for EURCV stablecoin
Paxos approved to issue stablecoins in Singapore
Paxos approved to issue stablecoins in Singapore
Paxos received full approval from the Monetary Authority of Singapore (MAS) for its Singapore entity to offer digital payment token services as a Major Payments Institution. The approval enables Paxos to issue stablecoins in line with MAS’s upcoming stablecoin framework. With the approval, Singapore becomes the third market, alongside the United States and United Arab Emirates, that Paxos and its related entities are authorized to issue stablecoins. Paxos has selected DBS Bank, Southeast Asia’s largest bank by assets, as its primary banking partner for cash management and custody of stablecoin reserves.
#Fintech#CryptoAssets#Stablecoins#Paxos#Singapore#Regulation#DFC
·paxos.com·
Paxos approved to issue stablecoins in Singapore
Bahamas to force banks to offer Sand Dollars
Bahamas to force banks to offer Sand Dollars
The Bahamas is reportedly preparing regulations that will require commercial banks to provide access to Sand Dollars in a bid to stimulate adoption. Governor John Rolle said with take-up of the central bank digital currency (CBDC) still limited, so commercial banks are being told of forthcoming regulations that will effectively force them to distribute it. Rolle said requiring commercial banks to embed the Sand Dollar in their systems should help usage but acknowledged the bigger problem was to get more merchants to accept it as a form of payment.
#Fintech#CBDC#Bahamas#DFC
·reuters.com·
Bahamas to force banks to offer Sand Dollars
Circle is First Global Stablecoin Issuer to Comply with MiCA
Circle is First Global Stablecoin Issuer to Comply with MiCA
Circle, the issuer of USDC and EURC, has become the first global stablecoin issuer to achieve compliance with the European Union's Markets in Crypto-Assets (MiCA) regulatory framework. This was enabled by the company’s attainment of an Electronic Money Institution (EMI) license (’agrément en qualité d'établissement de monnaie électronique) from the Autorité de Contrôle Prudentiel et de Résolution (ACPR). Of the top 10 stablecoins by market capitalization, only USDC is currently MiCA-compliant.
#Fintech#CryptoAssets#Stablecoins#Circle#Europe#Regulation#DFC
·circle.com·
Circle is First Global Stablecoin Issuer to Comply with MiCA
True offline payments are impossible. Or are they?
True offline payments are impossible. Or are they?
True offline payments are possible. They rely on, among other measures, strong hardware security, which is well-established in the industry. What is new is that CBDC will enable additional use cases, for example when both payer and payee are offline. But the technology for that is already there.
#Fintech#CBDC#Offline#DFC
·linkedin.com·
True offline payments are impossible. Or are they?
First trials with the Bundesbank Trigger Solution settled
First trials with the Bundesbank Trigger Solution settled
As part of the Eurosystem exploratory work, the first two trials with the Deutsche Bundesbank's Trigger Solution were successfully settled. The use case comprised the issuance and primary distribution of a commercial paper with the use case team Clearstream as a market distributed ledger technology (DLT) operator, and two market participants (DekaBank and DZ Bank). The exploration was conducted as a trial in the participants' production systems and ultimately resulted in real and final bookings in TARGET, the Eurosystem's payment system, by using the Trigger Solution. The Trigger Solution links DLT platforms operated by the market with the traditional Eurosystem payment system (TARGET), thus enabling the direct settlement of DLT-based wholesale transactions in central bank money on participants' existing RTGS accounts.
#Fintech#Settlement#Tokenization#Eurozone#ECB#CBDC#wCBDC#DFC
·bundesbank.de·
First trials with the Bundesbank Trigger Solution settled
Bank of Japan’s 7th Liaison Meeting on CBDC
Bank of Japan’s 7th Liaison Meeting on CBDC
The Bank of Japan published the minutes of the seventh “Liaison Meeting on Central Bank Digital Currency (CBDC)” held on May 29, but it’s in Japanese only. However, Norbert Gehrke has kindly provided a translation. Here are some of the points (all via the Ministry of Finance) that I found particularly interesting...It is not essential to allow non-residents to use CBDC from the initial issuance stage, because of the challenges associated with KYC and AML/CFT for non-residents and the possibility that their need for CBDC might not be particularly high. No concrete decisions have yet been made regarding CBDC cost sharing between the public and private sectors, in response to a suggestion from the Japan Securities Dealers Association that the public sector should bear all the cost because CBDC is the foundation of economic activities. CBDC is viewed as complementary to cash, and it is not essential for CBDC to replicate all cash functionalities. For instance, offline functionality, which carries risks of double-spending and counterfeiting, might not be necessary during the initial stages if cash remains usable. Regarding anonymity, the extent to which it can be ensured, given AML/CFT concerns, is still under consideration. https://www.boj.or.jp/paym/digital/dig240626a.pdf
#Fintech#CBDC#Japan#DFC
·medium.com·
Bank of Japan’s 7th Liaison Meeting on CBDC
Ousmène Jacques Mandeng on why CBDC?
Ousmène Jacques Mandeng on why CBDC?
"CBDC has brought a new thinking about the utility and functionality of money. It should be seen as an extension of existing payment systems but may be most effective for specific use cases only. CBDC is to equip financial systems with new functionality to address actual and future payment demands. It is to ensure central bank money can remain competitive... When being asked whether CBDC is a solution in search of a problem, I normally answer, that the question is referring only to problems we know. If we are looking to address the problems we know today, we are unlikely to be ready for the future."
#Fintech#CBDC#DFC
·linkedin.com·
Ousmène Jacques Mandeng on why CBDC?
Going cashless has turned Sweden into a high-crime nation?
Going cashless has turned Sweden into a high-crime nation?
Financial crime has become a growing risk for Sweden, with criminals taking 1.2 billion kronor in 2023 through scams, doubling from 2021. And law-enforcement agencies estimate that the size of Sweden’s criminal economy could amount to as high as 2.5% of the country’s gross domestic product. A Fortune article links these developments to switch from cash to electronic payments, and the pervasiveness of the BankID system that speeds such transactions up. It requires a six-digit code, a fingerprint or a face scan for authentication, but the system is being abused by fraudsters and scammers. Some are calling for banks to bear a bigger share of the burden when customers are defrauded, as will be the case in the United Kingdom, where, starting in October, banks will have to reimburse customers who have been conned into making transfers.
#Fintech#Cash#Payments#CyberCrime#Sweden#DFC
·fortune.com·
Going cashless has turned Sweden into a high-crime nation?
BdF and HKMA to unlock new WCBDC cross-border opportunities
BdF and HKMA to unlock new WCBDC cross-border opportunities
The Banque de France (BdF) and the Hong Kong Monetary Authority (HKMA) have launched a collaboration relating to wholesale central bank digital currency (CBDC). They will delve into the study of interoperability between their wholesale CBDC infrastructure, i.e. the BDF's DL3S and the HKMA's Project Ensemble Sandbox, with the main focus on real-time cross-border and cross-currency payments. The cross-border experiment aims to explore how to optimize settlement efficiency of cross-border transactions, and facilitate interoperability between financial market infrastructures in different jurisdictions.
#Fintech#CBDC#WCBDC#CrossBorder#HongKong#France#Eurozone#DFC
·hkma.gov.hk·
BdF and HKMA to unlock new WCBDC cross-border opportunities
ECB publishes first progress report on digital euro preparation phase
ECB publishes first progress report on digital euro preparation phase
On June 24, 2024 the European Central Bank (ECB) published its first progress report on the digital euro preparation phase, which was launched on November 1, 2023 with the aim of laying the foundations for the potential issuance of a digital euro. The report outlines the progress made on key digital euro design aspects and the envisaged next steps for the project.
#Fintech#CBDC#Eurozone#ECB#DFC
·ecb.europa.eu·
ECB publishes first progress report on digital euro preparation phase
India’s retail CBDC transaction volumes continue to slump
India’s retail CBDC transaction volumes continue to slump
Usage of India’s e-rupee, has slumped to just a tenth of the 1 million retail transactions per day peak hit in December 2023, according to a Reuters report. The transactions that are continuing are in part due to banks disbursing benefits to their employees via the e-rupee. This has helped to push up transactions to about 250,000 to 300,000 per day towards the end of each month. Apparently, the Reserve Bank of India (RBI) is not planning to rapidly expand the pilot and the current focus is on testing the technology and developing use cases for the digital currency.
#Fintech#CBDC#India#DFC
·reuters.com·
India’s retail CBDC transaction volumes continue to slump
Boerse Stuttgart, German banks to test settle tokenized securities
Boerse Stuttgart, German banks to test settle tokenized securities
The Boerse Stuttgart Group (BSG) will be part of the second wave of the European Central Bank (ECB) European Union-wide wholesale DLT trials for central bank money settlement. Commerzbank, Deutsche Bank, DZ Bank, LBBW, Bankhaus Metzler and V-Bank, who are directly connected to the Bourse’s new blockchain-based settlement solution, will act as trading and settlement participants to test the settlement of exchange transactions with tokenized securities against central bank money. The Deutsche Bundesbank is providing its trigger solution, which connects blockchain transactions with the traditional euro payment system, for the test.
#Fintech#CBDC#wCBDC#Eurozone#Tokenization#Settlement#Germany#DFC
·group.boerse-stuttgart.com·
Boerse Stuttgart, German banks to test settle tokenized securities
Central banks of France and Luxembourg publish results of Project Venus
Central banks of France and Luxembourg publish results of Project Venus
The Banque de France (BdF) and Banque centrale du Luxembourg have published the results of Project Venus, a successful 2022 experiment demonstrating the use of distributed ledger technologies (DLTs) in digital bond issuance and settlement. On 29 November 2022, the European Investment Bank (EIB) successfully issued a euro‑denominated digital bond on a private blockchain using wholesale central bank digital currency (CBDC) for settlement. Goldman Sachs Bank Europe, Santander and Société Générale facilitated the subscription and distribution processes. While project Venus was considered a success, further experimentation and policy work will be required before the decision is made to issue issue a wholesale CBDC. Meanwhile, the Eurosystem is conducting additional experiments and trials, with conclusions expected by mid-2025.
#Fintech#CBDC#wCBDC#Eurozone#Tokenization#Settlement#France#Luxembourg#DFC
·banque-france.fr·
Central banks of France and Luxembourg publish results of Project Venus
ECB announces 48 participants in wholesale DLT trials
ECB announces 48 participants in wholesale DLT trials
The European Central Bank (ECB) gave its approval for an additional group of participants to test distributed ledger technology (DLT) for the settlement of wholesale transactions in central bank money. In total, 48 private firms from the financial sector and three central banks will take part in the second wave of the Eurosystem’s exploratory work. From July to November 2024, the group will explore specific use cases, joining a first group of participants who have already been testing since May 13. This second wave will broaden the scope of the exploratory work and will cover (i) domestic payments within the euro area with mock settlement, (ii) a wide set of securities-related use cases with both real and mock settlement, and (iii) foreign exchange payment-versus-payment (PvP) transactions with other central banks with mock settlement. Meanwhile, nine participants from the first group will add further use cases and interoperability-type solutions. https://www.ecb.europa.eu/press/intro/news/html/ecb.mipnews240621.en.html
#Fintech#CBDC#wCBDC#ECB#Eurozone#Tokenization#Settlement#DFC
·ledgerinsights.com·
ECB announces 48 participants in wholesale DLT trials
Iran Officially Unveils Central Bank Digital Currency Project
Iran Officially Unveils Central Bank Digital Currency Project
Iran reportedly officially unveiled its CBDC on June 23, 2024 during a ceremony attended by Central Bank of Iran (CBI) Governor Mohammad Reza Farzin and chief executives of several major banks. A pilot project will commence in July on the island of Kish, involving two major Iranian banks, Mellat and Tejarat, and will focus on retail transactions. The digital rial’s introduction is part of Iran’s strategy to enhance its digital economy and payment infrastructure.
#Fintech#CBDC#Iran#DFC
·news.bitcoin.com·
Iran Officially Unveils Central Bank Digital Currency Project