DFC

5257 bookmarks
Newest
Bank of England receives 20 applications to develop CBDC wallet prototype
Bank of England receives 20 applications to develop CBDC wallet prototype
"Twenty companies have submitted applications to create a digital wallet for the Bank of England’s CBDC project. The bank underlined its desire to pursue a central bank digital currency by putting a contract for a sample wallet out to tender only three weeks ago, setting a deadline to complete applications by December 23. Despite the remarkably tight turnaround for the £200,000 five-month project, 28 applications were made, although eight didn’t pursue the contract bid beyond the deadline for questions on December 16. The completed applications are made up of nine SMEs and 11 ‘large’ companies." https://www.digitalmarketplace.service.gov.uk/digital-outcomes-and-specialists/opportunities/18948
#Fintech#CBDC#UnitedKingdom#DFC
·cityam.com·
Bank of England receives 20 applications to develop CBDC wallet prototype
Turkish central bank digital lira project update
Turkish central bank digital lira project update
Central Bank of the Republic of Turkey (CBRT) provided an update on the proof-of-concept phase of its Digital Turkish Lira Project. Payment transactions were successfully executed on the Digital Turkish Lira Network, and in the first quarter of 2023, closed-circuit tests will be carried out with technology stakeholders. The findings obtained from the tests will be shared with the public in a comprehensive evaluation report. The tests will then be expanded later in 2023 to include selected banks and financial technology companies, followed by broad participation pilot tests. Tests will include checking out how the distributed ledger technology (DLT) based platform will integrate with existing payment ecosystems. Also, throughout 2023, priority will be given to the legal framework and building out digital identification infrastructure.
#Fintech#CBDC#Turkey#DFC
·tcmb.gov.tr·
Turkish central bank digital lira project update
Bank of Canada 2021 Methods-of-Payment Survey Report
Bank of Canada 2021 Methods-of-Payment Survey Report
The Bank of Canada published the results from the 2021 Methods-of-Payment (MOP) Survey. It finds that while fewer Canadians are holding cash, those who do have cash tended to hold higher amounts over time. This is associated with fewer trips to obtain cash, but larger amounts withdrawn for a given trip, on average. Views about the features of cash have changed somewhat in recent years, though cash is still viewed quite positively in terms of acceptance, cost, ease of use and security. Most Canadians have no plans to stop using cash in the future.
#Fintech#CBDC#Cash#Payments#Canada#DFC
·bankofcanada.ca·
Bank of Canada 2021 Methods-of-Payment Survey Report
e-CNY wallet borrows Alipay and WeChat Pay’s electronic red packet feature to woo users
e-CNY wallet borrows Alipay and WeChat Pay’s electronic red packet feature to woo users
As part of its e-CNY central bank digital currency (CBDC) pilot, the People's Bank of China (PBOC) has launched a "hongbao" red packet feature, that allows users to send each other digital yuan-filled red packets. This comes just a month ahead of the Lunar New Year, when the Chinese traditionally give out red envelopes filled with cash to family and friends as a symbol of well wishes. The e-CNY app has been available in limited trials since 2020, but it continues to be an uphill battle to convince the Chinese public to use it. Digital yuan transactions hit $88 billion yuan ($12 billion) at the end of 2021, crossed the $100 billion yuan threshold at the end of August 2022.
#Fintech#CBDC#Asia#China#DFC
·scmp.com·
e-CNY wallet borrows Alipay and WeChat Pay’s electronic red packet feature to woo users
Leverage and Stablecoin Pegs
Leverage and Stablecoin Pegs
The National Bureau of Economic Research (NBER) published a paper that shows how stablecoins can maintain a constant price even though they face run risk and pay no interest. Stablecoin holders are indirectly compensated for stablecoin run risk because they can lend the coins to levered traders. Levered traders are willing to pay a premium to borrow stablecoins when speculative demand is strong. Therefore, the stablecoin can support a $1 peg even with higher levels of run risk. However, when speculative demand falls, stablecoin issuers can keep their debt trading at par only by moving to a safer portfolio or allowing redemptions. Such reallocation or change in stablecoin supply can cause disruptions in the real economy. Stablecoin issuers will need to adjust quickly if expected returns for cryptocurrencies fall; otherwise, they face the risk of collapse. These adjustments can cause disruptions in the markets they invest in, like the commercial paper market that provides financing to the real economy.
#Fintech#CryptoAssets#Stablecoins#DFC
·nber.org·
Leverage and Stablecoin Pegs
Palau continues to work with Ripple to explore the creation of national stablecoin
Palau continues to work with Ripple to explore the creation of national stablecoin
President Surangel Whipps Jr. reportedly confirmed that the Republic of Palau continues to work with Ripple on the creation of a government-issued US dollar-backed stablecoin (the US dollar is Palau's national currency). Last year Ripple announced a partnership with Palau to explore a national digital currency and its use cases based on XRP Ledger, initially focusing on cross-border payments.
#Fintech#CryptoAssets#Stablecoins#GovCoins#CBDC#Ripple#DFC
·bizzabo.engage-live.co.uk·
Palau continues to work with Ripple to explore the creation of national stablecoin
Should We Force Retailers To Accept Cash? Or Anything Else? No!
Should We Force Retailers To Accept Cash? Or Anything Else? No!
"People seem to think that cash is free, but it really isn’t. The cost to merchants is significant (which is why an increasing number of them don’t take it) and the cost to society should not be overlooked. So should we really be imposing a stealth tax on merchants by forcing them to accept cash any more than we should be forcing them to accept Bitcoin or, for that matter, cards? The answer is, frankly, no."
#Fintech#CBDC#Cash#DFC
·forbes.com·
Should We Force Retailers To Accept Cash? Or Anything Else? No!
Operationalization of the e-Rupee pilot
Operationalization of the e-Rupee pilot
"The e₹-R would be in the form of a digital token that represents legal tender. It would be issued in the same denominations that paper currency and coins are currently issued. It would be distributed through intermediaries, i.e., banks. Users will be able to transact with e₹-R through a digital wallet offered by the participating banks and stored on mobile phones / devices. Transactions can be both Person to Person (P2P) and Person to Merchant (P2M). Payments to merchants can be made using QR codes displayed at merchant locations. The e₹-R would offer features of physical cash like trust, safety and settlement finality. As in the case of cash, it will not earn any interest and can be converted to other forms of money, like deposits with banks."
#Fintech#CBDC#Asia#India#DFC
·rbi.org.in·
Operationalization of the e-Rupee pilot
You can now use JAM-DEX on Lynk
You can now use JAM-DEX on Lynk
“The combination of Lynk - Jamaica’s most innovative Digital Wallet - and JAM-DEX - Jamaica’s CBDC - offers a solution to three public policy objectives in the financial system - inclusion, security and convenience. As technology rapidly evolves, day-to-day and business payment transaction behaviours are also changing,” said Vernon James, Lynk CEO.
#Fintech#CBDC#Caribbean#Jamaica#DFC
·lynk.us·
You can now use JAM-DEX on Lynk
IMF suggests ‘extensive’ digital currency pilots for the Philippines
IMF suggests ‘extensive’ digital currency pilots for the Philippines
The International Monetary Fund (IMF) is recommending several phases and “extensive” pilot projects for the Bangko Sentral ng Pilipinas (BSP) wholesale central bank digital currency (CBDC) especially in cybersecurity issues, laws and regulations that will cover implementation. A wholesale CBDC is being considered in the Philippines as a possible means to enhance existing payment and settlement functions. While the BSP charter, amended in 2019, does allow for the issuance of wholesale CBDC, the regulatory framework “may need to be revisited to ensure governance and financial stability risks are addressed.” https://www.imf.org/en/Publications/CR/Issues/2022/12/15/Philippines-2022-Article-IV-Consultation-Press-Release-and-Staff-Report-526983
#Fintech#CBDC#Asia-Pacific#Philippines#wCBDC#DFC
·mb.com.ph·
IMF suggests ‘extensive’ digital currency pilots for the Philippines
The future monetary system
The future monetary system
"This chapter is organised as follows. To set the stage, it first describes today's monetary system and the high-level objectives it needs to achieve, and to what extent changes in technology and the economic environment have opened up room for improvement. The next section discusses the promise and pitfalls of crypto and DeFi innovations. The chapter then discusses a vision for the future monetary system, built on central bank public goods. The final section concludes."
#Fintech#CryptoAssets#Stablecoins#CBDC#Tokenization#BIS#DFC
·bis.org·
The future monetary system
Nigerian Central Bank Increases Cash Withdrawal Limits After Receiving Feedback From Stakeholders
Nigerian Central Bank Increases Cash Withdrawal Limits After Receiving Feedback From Stakeholders
Starting on January 9, 2023, the Central Bank of Nigeria (CBN) will allow individual banking clients to withdraw an equivalent of N500,000 ($1,120) per week (up from the N100,000 ($224) cap introduced on December 6, 2022). For corporate organizations, the cash withdrawal will be capped at N5,000,000 ($22,200 up from N500,000 ($1,120)). Also, the fees for cash withdrawals above the limits, in "compelling circumstances... for legitimate purposes", were reduced to 3% and 5% respectively (down from 5% and 10%). However, the daily limit on withdrawals from automatic teller machines (ATMs) and point-of-sale (PoS) terminals will remain at N20,000 ($45). https://www.cbn.gov.ng/Out/2022/CCD/ReNairaRedesignPolicyRevisedWithdrawal.pdf
#Fintech#Cash#CBDC#Africa#Nigeria#Regulation#DFC
·news.bitcoin.com·
Nigerian Central Bank Increases Cash Withdrawal Limits After Receiving Feedback From Stakeholders
Boston Fed, MIT complete research project into feasibility of a central bank digital currency
Boston Fed, MIT complete research project into feasibility of a central bank digital currency
A joint research effort between the Federal Reserve Bank of Boston and the Massachusetts Institute of Technology (MIT) into the technical feasibility of a potential central bank digital currency is now complete. Early this year, Project Hamilton published its research on a transaction processor for a theoretical high-performance and resilient CBDC. The processor was developed as open-source research software, called OpenCBDC, and project leaders urged global contributors to continue working on it. The project was announced in 2020, and in February 2022, the Boston Fed and MIT released the OpenCBDC software and a whitepaper describing their initial findings. They plan to release additional retrospectives on Project Hamilton’s findings in the coming months.
#Fintech#CBDC#UnitedStates#DFC
·bostonfed.org·
Boston Fed, MIT complete research project into feasibility of a central bank digital currency
The Bank of England seeking to bring systemic stablecoins into its regulatory remit
The Bank of England seeking to bring systemic stablecoins into its regulatory remit
The Bank of England published its supervision of financial market infrastructures 2022 Annual Report. It reports that the Financial Services & Markets Bill, published in July 2022 and scheduled to complete in 2023 seeks to bring systemic stablecoins into the Bank’s regulatory remit, and bring the UK regime in line with standards discussed. The Bank is now working on a regulatory framework for systemic stablecoins and plans to consult on this in due course. Alongside regulation, another key component of a stablecoin regime is the potential application of the FMI Special Administrative Regime to systemic stablecoin firms. The Bank, working with His Majesty's Treasury, will continue to develop this regime to ensure it reflects international CPMI-IOSCO guidance.
#Fintech#CryptoAssets#Stablecoins#Regulation#UnitedKingdom#DFC
·bankofengland.co.uk·
The Bank of England seeking to bring systemic stablecoins into its regulatory remit
ECB publishes second progress report on the digital euro investigation phase
ECB publishes second progress report on the digital euro investigation phase
The European Central Bank (ECB) published the second progress report on the investigation phase of a digital euro. It outlines the developments made since the first progress report, which was published in September 2022. The report details a second set of design and distribution options that were recently endorsed by the Governing Council and describes the roles of the Eurosystem and supervised intermediaries in the digital euro ecosystem. In 2023 the ECB will further assess a number of design and distribution options and in the second half of the year present the overall design of a digital euro to the Governing Council.
#Fintech#CBDC#Eurozone#ECB#DFC
·ecb.europa.eu·
ECB publishes second progress report on the digital euro investigation phase
Report on results of the second phase of the Digital Tenge project (English version)
Report on results of the second phase of the Digital Tenge project (English version)
The National Bank of Kazakhstan (NBK) and the Payment and Financial Technology Development Center of the Bank of Kazakhstan published the English version of their report on the second phase of their digital tenge central bank digital currency (CBDC) feasibility study.The second phase was comprised primarily of proof-of-concept work involving select financial institutions, merchants and final users. The report calls it a "pilot" but is silent on who the selected final users were. If they were central bank employees, it is a proof-of-concept by most CBDC exploration workflow taxonomies, but if users were selected from the general public, then it's a pilot. In any case, the report recommends a phased rollout starting in 2023 with a gradual expansion of its functionality and step-by-step introduction into production scale by the end of 2025.
#Fintech#CBDC#Asia#Kazakhstan#DFC
·nationalbank.kz·
Report on results of the second phase of the Digital Tenge project (English version)
Towards legal interoperability of retail CBDCs: a comparative law perspective
Towards legal interoperability of retail CBDCs: a comparative law perspective
The European Central Bank (ECB) published a collection of papers presented at the September 5-6, 2022 European System of Central Banks (ESCB) Legal Conference, including three on the legal aspects of central bank digital currency (CBDC) interoperability. A paper by Jess Cheng and Joseph Torregrossa discusses the concept of “legal interoperability” in the domestic payment system and its relevance to the retail CBDC context, particularly as the necessary legal foundation for transferability and convertibility. The second by Panagiotis Papapaschalis makes the case for exposing and overcoming technical and legal obstacles to interoperability ex-ante and early on, rather than trying to tackle them ex post, i.e. only when the various, diverging, CBDCs have gained momentum. The third paper, by Seraina Grünewald, focuses particularly on the prospects and challenges for the legal interoperability of a digital euro.
#Fintech#CBDC#Interoperability#Legal#ECB#DFC
·ecb.europa.eu·
Towards legal interoperability of retail CBDCs: a comparative law perspective
ECB finds strong demand for both cash and digital payments
ECB finds strong demand for both cash and digital payments

Cash is still the most frequently used means of payment at the point of sale, but its share is declining according to the latest study on the payment attitudes of consumers in the euro area, published by the European Central Bank (ECB). Cash was used for 59% of point-of-sale transactions in 2022, down from 72% in 2019. It is the means of payment most often used for small-value payments in stores and for person-to-person transactions. A majority (60%) also consider it important to have cash as a payment option. Consumers perceive cash as helpful to remain aware of their expenditures, to protect their privacy and to allow transactions to be settled immediately. https://www.ecb.europa.eu/stats/ecb_surveys/space/html/index.en.html

#Fintech#CBDC#Cash#Payments#Europe#DFC
·finextra.com·
ECB finds strong demand for both cash and digital payments
Crunchfish ready to start Digital Cash pilot with Indian banks
Crunchfish ready to start Digital Cash pilot with Indian banks
"Crunchfish in partnership with HDFC Bank and one additional Indian bank have been working together to develop a solution for Offline Retail Payments that will be demonstrated in a pilot to Reserve Bank of India (RBI) in their Regulatory Sandbox program*. The project, if successful, will provide the basis for RBI’s guidance and regulatory support in providing Offline Retail Payments, based on Crunchfish Digital Cash platform, to the payment ecosystem of India. "
#Fintech#CBDC#Payments#Offline#Crunchfish#DFC
·crunchfish.com·
Crunchfish ready to start Digital Cash pilot with Indian banks
Potential benefits and key risks of fiat-referenced cryptoassets
Potential benefits and key risks of fiat-referenced cryptoassets
"Fiat-referenced cryptoassets have seen tremendous growth in recent years. Since these types of cryptoassets have the potential to perform many of the functions of money, they could become more widely used to pay for everyday goods and services. Fiat-referenced cryptoassets could make payments faster and more efficient due to features of the novel technology they are built on. However, they could also pose financial stability risks, some of which were illustrated in the market turmoil of May and November 2022, highlighting the need for adequate regulation and supervision. Work is underway, domestically and internationally, to develop a robust regulatory framework to mitigate the risks these types of cryptoassets can pose to holders, the financial system and the economy. A timely and comprehensive regulatory approach in Canada will ensure that fiat-referenced cryptoassets can deliver potential benefits without posing unnecessary risks."
#Fintech#CryptoAssets#Stablecoins#Canada#DFC
·bankofcanada.ca·
Potential benefits and key risks of fiat-referenced cryptoassets
The Relative Benefits and Risks of Stablecoins as a Means of Payment
The Relative Benefits and Risks of Stablecoins as a Means of Payment
The Bank of Canada published a paper on the utility of stablecoins for retail payments. It finds that certain stablecoin arrangements offer end users greater control of their privacy, facilitate more rapid innovation and have the potential to increase transaction speeds, particularly for cross-border payments. At the same time, stablecoins may provide less consumer protection for fraud, present higher risks to the payment system and to efforts to combat financial crime, and be costlier relative to traditional payment arrangements. The paper's findings suggest that stablecoin arrangements do not currently serve as substitutes for the suite of traditional payment arrangements but instead address niche use cases or user segments that value their benefits and can accept their risks or costs.
#Fintech#CryptoAssets#Stablecoins#DFC
·bankofcanada.ca·
The Relative Benefits and Risks of Stablecoins as a Means of Payment
Bank of Ghana CBDC Update
Bank of Ghana CBDC Update
According to Bank of Ghana Governor Ernest Addison, a successful implementation of the eCedi CBDC will further advance financial inclusion, strengthen policy transmission, promote efficiency in the payment system, and provide a safe alternative to private digital assets. 38. After taking the necessary preparatory steps, a three (3) staged pilot was implemented in Accra and Tarkwa in collaboration with CAL Bank, Fidelity Bank,Vodafone Cash, IT Consortium and ExpressPay to test the online version of the eCedi, while an off-line version was tested in Sefwi Asafo. The initial findings from the pilot have provided the Bank with deep insights on the possible implementation process for the eCedi, and these results will soon be shared with industry players.
#Fintech#CBDC#Africa#Ghana#DFC
·bog.gov.gh·
Bank of Ghana CBDC Update
The stable in stablecoins
The stable in stablecoins
The US Federal Reserve Board (FRB) published a note that describes the general lifecycle of a stablecoin from its issuance to its redemption. It then categorizes various stabilization mechanisms and discuss how they work in practice. A key observation is that, although several stablecoins may peg their value to the same real-world asset, stabilization mechanisms can vary greatly in terms of maintaining stability with the reference asset, and so may have varying susceptibilities to the risk of runs from the stablecoin to the reference asset.
#Fintech#CryptoAssets#Stablecoins#DFC
·federalreserve.gov·
The stable in stablecoins
Kazakhstan central bank recommends a phased CBDC rollout between 2023-25
Kazakhstan central bank recommends a phased CBDC rollout between 2023-25
The National Bank of Kazakhstan (NBK) and the Payment and Financial Technology Development Center of the Bank of Kazakhstan (NBK) published a report on the results of the study on the need to introduce the digital tenge. It is reportedly recommending making the central bank digital currency (CBDC) available as early as 2023 with a phased expansion of functionality and introduction into commercial operation until the end of 2025. Unfortunately the report won't be available in English until later this week, at which point I'll be able to verify some of the facts and plans. For example, the report is saying that a pilot was just wrapped up, but it's unclear whether it's a pilot of proof of concept, since I don't know the composition of the test users. If they're pulled from the general public, it is a pilot, but if the test subjects are limited to central bank staff, it's a proof of concept by my taxonomy. https://nationalbank.kz/kz/news/novosti/14692
#Fintech#CBDC#Kazakhstan#Asia#DFC
·cointelegraph.com·
Kazakhstan central bank recommends a phased CBDC rollout between 2023-25
The Riksbank is making preparations for a possible e-krona
The Riksbank is making preparations for a possible e-krona
"The Riksbank is continuing to investigate the possibility of issuing a digital complement to cash, known as the e-krona. This would preserve public access to government-issued money even if cash were to be marginalised further. In addition, the e-krona could strengthen the resilience of the payments market. No decision has yet been taken to issue an e-krona.
#Fintech#CBDC#Sweden#DFC
·riksbank.se·
The Riksbank is making preparations for a possible e-krona
BIS Finalizes Bitcoin Bank Limits
BIS Finalizes Bitcoin Bank Limits
The BIS Basel Committee on Banking Supervision has finalized a proposed policy that would place a 2% limit on banks' Tier 1 capital held in bitcoin and other "Group 2" crypto-assets. Tier 1 capital is the core capital held in a bank's reserves that is used to fund business activities for the bank's clients. It includes common stock, as well as disclosed reserves and certain other assets. Group 1 crypto-assets include tokenised traditional assets (Group 1a) and crypto-assets with effective stabilization mechanisms (Group 1b). Group 1 crypto-assets are subject to capital requirements based on the risk weights of underlying exposures as set out in the existing Basel Framework. Group 2 crypto-assets are those that fail to meet any of the Group 1 classification conditions. https://www.bis.org/press/p221216.htm
#Fintech#CryptoAssets#Stablecoins#Tokenization#Regulation#Basel#DFC
·bitcoinmagazine.com·
BIS Finalizes Bitcoin Bank Limits
Pre-announcement of the digital euro market research
Pre-announcement of the digital euro market research
In January 2023, the European Central Bank (ECB) will invite market participants to take part in market research to obtain an overview of options for the technical design of possible digital euro components and services. The market research will consist of a set of questions to obtain technical input, as well as cost and time estimations. Participation will not be remunerated. It will not have any impact on eligibility for future procurement procedures related to a digital euro or any other procurement procedures. Nor will it imply any pre-selection for a potential subsequent tender. The ECB intends to publish the findings of the market research in the second quarter of 2023.
#Fintech#CBDC#Eurozone#DFC
·ecb.europa.eu·
Pre-announcement of the digital euro market research