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Recent Technological Advances in Financial Market Infrastructure in ASEAN+3
Recent Technological Advances in Financial Market Infrastructure in ASEAN+3
This Asian Development Bank (ADB) report ascertains the current status of technology adoption, including wholesale CBDC applications, by its Cross-Border Settlement Infrastructure Forum member organizations. They include central securities depositories and central banks in the Association of Southeast Asian Nations (ASEAN) plus the People’s Republic of China, Japan, and the Republic of Korea (collectively known as ASEAN+3) region.
#Fintech#CBDC#wCBDC#Asia#FMIs#DFC
·adb.org·
Recent Technological Advances in Financial Market Infrastructure in ASEAN+3
The digitalisation of money (BIS WP)
The digitalisation of money (BIS WP)
"The ongoing digital revolution may lead to a radical departure from the traditional model of monetary exchange. We may see an unbundling of the separate roles of money, creating fiercer competition among specialized currencies. On the other hand, digital currencies associated with large platform ecosystems may lead to a re-bundling of money in which payment services are packaged with an array of data services, encouraging differentiation but discouraging interoperability between platforms. Digital currencies may also cause an upheaval of the international monetary system: countries that are socially or digitally integrated with their neighbors may face digital dollarization, and the prevalence of systemically important platforms could lead to the emergence of digital currency areas that transcend national borders. Central bank digital currency (CBDC) ensures that public money remains a relevant unit of account."
#Fintech#CryptoAssets#CBDC#Stablecoins#DFC
·bis.org·
The digitalisation of money (BIS WP)
Taiwan completes trials of its prototype CBDC for retail use
Taiwan completes trials of its prototype CBDC for retail use
[This is a 2022 story] Taiwan has completed trials of its prototype retail central bank digital currency (CBDC) in technical simulations. Taiwan started to study and test a retail CBDC in September 2020, and the central bank has engaged with at least Taiwanese five commercial banks in the proof-of-concept (POC) work. They also tested a wholesale CBDC. Next steps are to educate the public on purported benefits, draw up regulations and put in place a sound legal framework, before proceeding to a public pilot. https://www.cbc.gov.tw/tw/cp-302-153094-0954b-1.html
#Fintech#CBDC#Asia#China#wCBDC#DFC
·forkast.news·
Taiwan completes trials of its prototype CBDC for retail use
Central bank provider SICPA to create CBDC venture with INX
Central bank provider SICPA to create CBDC venture with INX
INX, the inter-dealer broker and digital asset trading platform, is planning a joint venture with central bank provider SICPA to develop a central bank digital currency (CBDC) offering. While SICPA is best known for its secure inks that have been used on Euro notes, it also has extensive digital capabilities. The CBDC offering will be based on blockchain and aims to expand interoperability between different stakeholders across borders.
#Fintech#CBDC#DFC
·ledgerinsights.com·
Central bank provider SICPA to create CBDC venture with INX
Ripple Launches CBDC Competition to Encourage XRPL Innovation
Ripple Launches CBDC Competition to Encourage XRPL Innovation
Ripple has announced the CBDC Innovate challenge, with a total prize pool of $150,000. The Ripple CBDC Innovate challenge seeks to inspire programmers to build applications capable of running on the XRP Ledger and supporting retail central bank digital currencies (CBDCs), interoperability and financial inclusion. The deadline for the first batch of submissions is August 25. Competitors are expected to build or update a fintech or payment solution that makes use of CBDC and can run on the XRP Ledger, create a solution that can take advantage of CBDC's advantages or create an interface that allows any human to engage with a CBDC.
#Fintech#CryptoAssets#Ripple#CBDC#DFC
·ripplecbdc.devpost.com·
Ripple Launches CBDC Competition to Encourage XRPL Innovation
ANZ completes first A$DC stablecoin transaction
ANZ completes first A$DC stablecoin transaction
ANZ customer Victor Smorgon Group successfully purchased tokenized Australian carbon credits (BCAU) using the ANZ-issued stablecoin A$DC. This transaction is an important step for ANZ as the bank explores greater circulation of the stablecoin. In this transaction, Victor Smorgon Group used A$DC as a medium of exchange to purchase the BCAU carbon tokens from Zerocap, an Australian crypto asset investment platform.
#Fintech#CryptoAssets#Stablecoins#Australia#DFC
·finextra.com·
ANZ completes first A$DC stablecoin transaction
Bank of Russia Accelerates Schedule for Digital Ruble Project
Bank of Russia Accelerates Schedule for Digital Ruble Project
The Central Bank of Russia is continuing to step up efforts to test and issue the digital ruble, with a roadmap for full implementation now expected by the end of 2023, with pilot testing scheduled to begin in April 2023. In February (2022) the central bank had implied that it had started pilot testing already, but this new announcement makes the earlier efforts sound more like proof of concept work ("clients were able to exchange non-cash rubles in their accounts for digital ones, and then they transferred digital rubles between themselves").
#Fintech#CBDC#Russia#DFC
·cbr.ru·
Bank of Russia Accelerates Schedule for Digital Ruble Project
Himes Proposes Central Bank Digital Currency
Himes Proposes Central Bank Digital Currency
"Congressman Jim Himes (CT-04) today released a proposal for the issuance of a Central Bank Digital Currency (CBDC) by the Federal Reserve. In the white paper, Rep. Himes argues that along with many other benefits, the implementation of digital currency by the U.S. government could play a critical role in preserving the dollar’s role as the global reserve currency of choice."
#Fintech#CBDC#UnitedStates#DFC
·himes.house.gov·
Himes Proposes Central Bank Digital Currency
More African Central Banks Are Exploring Digital Currencies
More African Central Banks Are Exploring Digital Currencies
The IMF published a blog that provides a summary of African central bank digital currency (CBDC) activity based on CBDCTracker.org data. It points to the need for governments to improve access to digital infrastructure such as a phone or internet connectivity, and the importance of offline access, for a retail CBDC to be effective, particularly if financial inclusion is a primary motivator. It also underscores the need for central banks to develop the expertise and technical capacity to manage data privacy and financial integrity risks, including strengthening national identification systems so know-your-customer requirements are more easily enforced. There is also a risk that users pull too much money out of banks to purchase CBDCs, affecting banks’ ability to lend.
#Fintech#CBDC#Africa#IMF#Offline#DFC
·blogs.imf.org·
More African Central Banks Are Exploring Digital Currencies
New types of digital money
New types of digital money
Danmarks Nationalbank published a paper that summarizes the central bank's thoughts on digital currency, including retail central bank digital currency (CBDC). At present, and with the associated costs and possible risks, the paper concludes that it is not clear how retail CBDCs will create significant added value relative to the existing solutions in Denmark. However, the central bank will continue to continuously assess the various reasons for issuing retail CBDC and their possible relevance in relation to the Danish financial system
#Fintech#CBDC#Europe#Denmark#DFC
·nationalbanken.dk·
New types of digital money
Tether To Launch GBP₮, Tether Tokens Pegged to the British Pound Sterling
Tether To Launch GBP₮, Tether Tokens Pegged to the British Pound Sterling
Tether will be launching Tether tokens (“GBP₮”) pegged to British Pound Sterling in July. No further details were provided, such as how and where it will be backed. It will join four other fiat-currency pegged tokens Tether has in the market: the U.S. dollar-pegged USD₮, the Euro-pegged EUR₮, the offshore Chinese Yuan-pegged CNH₮, and MXN₮, the Mexican Peso-pegged stablecoin.
#Fintech#CryptoAssets#Stablecoins#Tether#DFC
·tether.to·
Tether To Launch GBP₮, Tether Tokens Pegged to the British Pound Sterling
Bank of Israel investigates anonymous digital shekel payments
Bank of Israel investigates anonymous digital shekel payments
The Bank of Israel published an update on their CBDC proof-of-concept (PoC) experiments, including some that were based on distributed-ledger technology (DLT) infrastructure on the cloud, and the application of a Quorum blockchain based on Ethereum. They also examined a platform developed by VMware in which there would be a wallet that can hold “ordinary” digital shekels, the transfer of which is recorded in the ledger, and “private” digital shekels, the transfer details of which are not recorded openly, and where both sides to the transaction enjoy complete privacy as with cash payments. There would be a periodic (e.g., monthly) “budget” for payment using private shekels. https://www.boi.org.il/en/NewsAndPublications/PressReleases/Pages/20-6-22.aspx
#Fintech#CBDC#MiddleEast#Privacy#DFC
·finextra.com·
Bank of Israel investigates anonymous digital shekel payments
CBDCs, Not Crypto, Will Be Cornerstone of Future Monetary System, BIS Says
CBDCs, Not Crypto, Will Be Cornerstone of Future Monetary System, BIS Says
According to a 42-page chapter in the Bank for International Settlements (BIS) 2022 Annual Economic Report crypto’s structural flaws make it an unsuitable basis for a monetary system, and instead envisions a future where programmability and tokenization are built on top of central bank digital currencies (CBDCs). Structural flaws make the crypto universe unsuitable as the basis for a monetary system: because it lacks a stable nominal anchor, while limits to its scalability result in fragmentation. Contrary to the decentralization narrative, crypto often relies on unregulated intermediaries that pose financial risks. https://www.bis.org/publ/arpdf/ar2022e3.htm
#Fintech#CBDC#BIS#DFC
·coindesk.com·
CBDCs, Not Crypto, Will Be Cornerstone of Future Monetary System, BIS Says
Project Rosalind Phase 1 - Invitation for Expression of Interest (EOI) for API Users and Advisors Group
Project Rosalind Phase 1 - Invitation for Expression of Interest (EOI) for API Users and Advisors Group
The BIS Innovation Hub London Centre invites companies and organizations to submit expressions of interest to join the Project Rosalind to develop application programming interface (API) prototypes for distributing CBDCs. The group will be structured into two tiers – API users and technical advisors, with different roles and responsibilities for each. The project, run jointly with the Bank of England, aims to address some of the questions around developing a retail CBDC system, including: how to improve public-private sector collaboration? How to maximize interoperability, encourage competition and enable adoption? How might retail CBDC meet current and future consumer needs in a fast-changing payments landscape? The objective is to explore how this interface could best enable a central bank ledger to interact with private sector service providers to safely provision retail payments.
#Fintech#CBDC#BIS#DFC
·bis.org·
Project Rosalind Phase 1 - Invitation for Expression of Interest (EOI) for API Users and Advisors Group
Bangladesh exploring CBDC as an alternative to ‘risky’ private digital currencies
Bangladesh exploring CBDC as an alternative to ‘risky’ private digital currencies
Bangladesh Bank will be conducting a central bank digital currency (CBDC) feasibility study, according to the country's Minister of Finance AHM Mustafa Kamal. The main motivation is to "facilitate currency in virtual transactions and to encourage startups and e-commerce businesses.
#Fintech#CBDC#Asia#DFC
·mof.portal.gov.bd·
Bangladesh exploring CBDC as an alternative to ‘risky’ private digital currencies
Philippines, Vietnam conducting CBDC feasibility studies with Soramitsu
Philippines, Vietnam conducting CBDC feasibility studies with Soramitsu
"Japanese blockchain firm Soramitsu has reportedly landed feasibility studies for central bank digital currency (CBDC) with both Vietnam and the Philippines. Soramitsu is establishing a considerable footprint in Southeast Asia following its successful implementation of Cambodia’s Bakong project in 2020. Last year it also started working with Laos’ central bank on a CBDC research project."
#Fintech#CBDC#Asia-Pacific#DFC
·ledgerinsights.com·
Philippines, Vietnam conducting CBDC feasibility studies with Soramitsu
Central Bank preparing concept of digital manat
Central Bank preparing concept of digital manat
"Central Bank of Azerbaijan (CBA) is preparing the concept of a digital manat [country’s national currency], an expert of the National Payment Systems Development Division of the Payment Systems and Settlements Department of CBA Rashad Gasimov said during еру Fintex Summit 2022 [Finance and Technologies Expo is being held in Azerbaijan’s Baku, on June 16-17], Trend reports."
#Fintech#CBDC#Asia#DFC
·azernews.az·
Central Bank preparing concept of digital manat
BIS Innovation Hub, Bank of Israel and Hong Kong Monetary Authority will cooperate to test retail CBDC
BIS Innovation Hub, Bank of Israel and Hong Kong Monetary Authority will cooperate to test retail CBDC
The BIS Innovation Hub, the Bank of Israel and the Hong Kong Monetary Authority will join forces to test the feasibility of a cyber secure two-tier retail central bank digital currency (CBDC) in which intermediaries are "exposure-less". Intermediaries in "Project Sela" will have technological access to the CBDC system, conduct the know your customer (KYC) processes, and provide consumer services, but are not financially exposed, at any point of the processes of obtaining, transferring, or redeeming CBDC. This architecture is assumed to have several benefits: less financial risk for customers, more liquidity, lower costs, increased competition, and wider access, plus  enhanced resilience to sophisticated cyber attacks.
#Fintech#CBDC#DFC
·boi.org.il·
BIS Innovation Hub, Bank of Israel and Hong Kong Monetary Authority will cooperate to test retail CBDC
Euro Coin (EUROC) is coming on June 30th
Euro Coin (EUROC) is coming on June 30th
Circle, the issuer of the USD Coin (USDC) dollar-pegged stablecoin, is launching a EUR-backed stablecoin (EUROC) on June 30. EUROC will be 100% backed by euros held in euro-denominated banking accounts so that it’s always redeemable 1:1 for euros. Businesses will be able to mint EUROC straight from the source by depositing euros into their Circle Account using Silvergate’s Euro SEN network, after which it will be available to non-Circle Account users via digital asset exchanges and DeFi protocols. Additional deposit options are expected to be available later this year. EUROC will be issued as an ERC-20 token on the Ethereum blockchain, with support for additional blockchains expected later this year.
#Fintech#CryptoAssets#Stablecoins#Circle#DFC
·circle.com·
Euro Coin (EUROC) is coming on June 30th
Seven lessons from the e-Peso pilot plan
Seven lessons from the e-Peso pilot plan
The Banco Central del Uruguay's Adolfo Sarmiento writes about seven lessons from the 2017-18 e-Peso CBDC pilot, highlighting that CBDC choices are based not only on technical considerations but also on money use culture. This implies a holistic assessment of the payment environment and a clear understanding of the cultural implications of a change that will be incremental but not reversible. This implies that research on CBDC must concern idiosyncratic aspects: economy organization, historical aspects, and even social implications of money.
#Fintech#CBDC#LATAM#DFC
·sciencedirect.com·
Seven lessons from the e-Peso pilot plan
Missing Key: The challenge of cybersecurity and central bank digital currency
Missing Key: The challenge of cybersecurity and central bank digital currency
The Atlantic Council published a report on cybersecurity issues related to central bank digital currency (CBDC). It analyzes the intertwined questions of policy, design, and security to focus policy makers on how to build secure CBDCs that protect users’ data and maintain financial stability. The analysis shows that privacy-preserving CBDC designs are not only possible, but also come with inherent security advantages, compared to current payment systems, that may reduce the risk of cyberattacks.
#Fintech#CBDC#CyberSecurity#DFC
·atlanticcouncil.org·
Missing Key: The challenge of cybersecurity and central bank digital currency
DEA provides industry insights on digital euro design to ECB
DEA provides industry insights on digital euro design to ECB
"Jürgen Schaaf stressed the importance of privacy (ranked first in the consultation on the digital euro by European citizens) and discussed different privacy options the ECB has analyzed. These options range from full anonymity to fully transparent payments to the central bank. It was argued that full anonymity will, as a preliminary view, not be a viable option as it conflicts with regulation around anti-money laundering. Nevertheless, and as stressed by some participants, since there is no CBDC regulation in place, an anonymous CBDC would not necessarily be against compliance. During the meeting, a survey about privacy was conducted amongst attendees and revealed that 50% of  participants were in favor of selective privacy, which means higher privacy for low-value transactions, an approach that has already been seen as technically feasible. 33% of the participants voted for anonymity, and 0% (!!) voted for payment transparency to an intermediary or fully transparent to the central bank. "
#Fintech#CBDC#Privacy#Offline#DFC
·blog.digital-euro-association.de·
DEA provides industry insights on digital euro design to ECB
Cash in the Pocket, Cash in the Cloud: Cash Holdings of Bitcoin Owners
Cash in the Pocket, Cash in the Cloud: Cash Holdings of Bitcoin Owners
"We estimate the effect of Bitcoin ownership on the level of cash holdings of Canadian consumers. Bitcoin ownership positively correlates with cash holdings even after accounting for selection into ownership via a control function approach. On average, Bitcoin owners hold 83 percent (in 2018) to 95 percent (in 2017) more cash than non-owners. Focusing on the quantiles of cash holdings, we find that Bitcoin ownership has a highly nonlinear effect. For example, the difference in cash holdings between Bitcoin owners and non-owners in 2017 varies from 63 percent at the 25th quantile of cash to 176 percent at the 95th quantile of cash. Our results provide some evidence to reject the hypothesis that new digital currencies or technologies, such as Bitcoin, will lead to a decline in cash holdings."
#Fintech#CryptoAssets#Bitcoin#Cash#DFC
·bankofcanada.ca·
Cash in the Pocket, Cash in the Cloud: Cash Holdings of Bitcoin Owners
Tether Condemns False Rumors About Its Commercial Paper Holdings
Tether Condemns False Rumors About Its Commercial Paper Holdings
Tether pushed back on rumors that the commercial paper held as USDT stablecoin reserves is 85% comprised of paper backed by (mostly shaky) Chinese or Asian firms. As of the most recent attestation report commercial paper made up about 25% of USDT's backing, and Tether is gradually switching maturing paper into short-maturity U.S. Treasury securities. Also, Tether's Celsius position has been liquidated with no losses to Tether, and Tether has currently zero exposure to Celsius apart from a small investment made out of Tether equity in the company.
#Fintech#CryptoAssets#Stablecoins#Tether#DFC
·tether.to·
Tether Condemns False Rumors About Its Commercial Paper Holdings
Runs on Algorithmic Stablecoins: Evidence from Iron, Titan, and Steel
Runs on Algorithmic Stablecoins: Evidence from Iron, Titan, and Steel
"Design flaws in the no-arbitrage mechanism contributed to the failure of the IRON stablecoin. That said, the design flaws we uncover in this paper are not easily fixed. For instance, using the spot price as opposed to the ten-minute weighted-average price of TITAN in the creation of IRON is susceptible to manipulation of the spot price. It remains to be seen whether future generations of algorithmic stablecoins can improve these issues. For now, our results serve as useful reminder that some stablecoins are not stable at all, particularly for the users of smaller accounts who bought into the falling knife when IRON was tumbling."
#Fintech#CryptoAssets#Stablecoins#DFC
·federalreserve.gov·
Runs on Algorithmic Stablecoins: Evidence from Iron, Titan, and Steel