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China digital currency: Shenzhen consumers spend 8.8 million yuan in largest trial of digital yuan
China digital currency: Shenzhen consumers spend 8.8 million yuan in largest trial of digital yuan
The digital yuan is entering an already very crowded payments market in China, with smartphone apps WeChat Pay and Alipay already dominating the electronic payments sector. Businesses reported minimal differences in processing payments with the e-yuan compared to existing mobile payment products, although they did note that it does not cost them an additional service free unlike both WeChat Pay and Alipay. Also, payments via the digital yuan can be made without connecting to the internet.
#Fintech#CryptoAssets#CBDC#DFC
·scmp.com·
China digital currency: Shenzhen consumers spend 8.8 million yuan in largest trial of digital yuan
DCEP Adoption: How to use the Digital Yuan
DCEP Adoption: How to use the Digital Yuan
To use the digital yuan for payments, the holder has to scan a merchant’s code using their digital yuan mobile application. The app has an identical user interface as that of Alipay. When scanning, the app supports either a barcode or a QR code. The merchant can scan the code from their customers, or the customers can scan their merchant’s code to activate payment. The app has a feature called "touch" that eliminates the need for a connecting network, provided that the consumer’s and merchant’s mobile devices touch each other when initiating a payment.
#Fintech#CryptoAssets#CBDC#DFC
·asiacryptotoday.com·
DCEP Adoption: How to use the Digital Yuan
The Bahamas Launches Its Central Bank Digital Currency
The Bahamas Launches Its Central Bank Digital Currency
The Bahamas Sand Dollar central bank digital currency (CBDC) became available to all residents of The Bahamas on October 20. This makes The Bahamas the first country in the world to officially roll out a CBDC. Residents of The Bahamas can use the blockchain-based digital currency at any merchant with a central bank approved e-Wallet on their mobile device and transaction fees are negligible. The central bank has authorized six financial institutions for the project: Omni Financial, Kanoo, SunCash, Cash N Go, Mobile Assist, and Money Maxx. https://twitter.com/CentralbankBS1/status/1318658064074084352
#Fintech#CryptoAssets#CBDC#DFC
·decrypt.co·
The Bahamas Launches Its Central Bank Digital Currency
BSP says more groundwork needed before it can issue digital currency
BSP says more groundwork needed before it can issue digital currency
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno reportedly said that the central bank recently completed its study on issuing central bank digital currency (CBDC). It recommended continuing research, capacity-building, and the establishment of networks with central banks and institutions that are also conducting research on this scheme. The Governor said it is unlikely than one will be introduced in the near term. The study is exploratory in nature, and is in line with BSP’s Digital Payments Transformation Roadmap which aims to convert at least 50% of retail payments into digital form and that at least 70% of adult Filipinos should have a bank account by 2023.
#Fintech#CryptoAssets#CBDC#DFC
·business.inquirer.net·
BSP says more groundwork needed before it can issue digital currency
Eurosystem lays out retail digital payment strategy
Eurosystem lays out retail digital payment strategy
The Eurosystem is pursuing a new strategy to respond to the rapid digitalisation of the eurozone’s payments market, partly in response to the Covid-19 pandemic. Fabio Panetta, of the European Central Bank’s executive board, said the strategy would increase the provision of cash and instant payments. It would also include new supervisory methods and work on the digital euro. He said that European authorities must ensure that digital payments are underpinned by a competitive and innovative market capable of meeting consumer demand, while preserving European sovereignty. https://www.ecb.europa.eu/press/key/date/2020/html/ecb.sp201022~d66111be97.en.html
#Fintech#CryptoAssets#Payments#CBDC#FastPayments#DFC
·centralbanking.com·
Eurosystem lays out retail digital payment strategy
Two Types of Postal Banking
Two Types of Postal Banking
Why does the U.S. Postal Service (USPS) need to be involved at all in reaching the unbanked if a brick & mortar branch network isn’t important? It doesn’t. Any government agency could probably fill the role. In fact, the U.S. Treasury is already a major provider of a limited range of banking services via its Direct Express prepaid debit card. Rather than starting a new government debit card program from scratch, building off of and improving the Direct Express card would probably make more sense. On the other hand, USPS is a well-known brand. A prepaid card with the USPS logo on it would probably better stand out on a card rack than the Treasury’s brand.
#Fintech#CBDC#DFC
·aier.org·
Two Types of Postal Banking
The Madagascar e-Ariary CBDC project in a few lines
The Madagascar e-Ariary CBDC project in a few lines
The Central Bank of Madagascar is considering issuing retail central bank digital currency (CBDC). The e-Ariary project will be carried out in two phases; (i) conduct analysis, design work and experimentation, and (ii) deployment and production, the realisation of the second phase conditioned by the results of the experimental phase.
#Fintech#CryptoAssets#CBDC#DFC
·banky-foibe.mg·
The Madagascar e-Ariary CBDC project in a few lines
Central bank digital currencies: Drivers, approaches, and technologies
Central bank digital currencies: Drivers, approaches, and technologies
Central bank digital currencies are in the limelight. Yet the motives for issuance and, relatedly, the policy approaches and designs differ. This column surveys the drivers, policy approaches and technical designs, based on a comprehensive and publicly available database. It finds that all Central bank digital currency projects aim to complement cash rather than replace it. Many projects would allow for an important role of the private sector in the payment system. (This is a summary of a previously-published working paper: https://www.bis.org/publ/work880.htm)
#Fintech#CryptoAssets#CBDC#DFC
·voxeu.org·
Central bank digital currencies: Drivers, approaches, and technologies
CBDC architectures, the financial system, and the central bank of the future
CBDC architectures, the financial system, and the central bank of the future
This column updates a recent BIS Quarterly Review article on central bank digital currency (CBDC) architectures, how they could complement existing payment options, and what they imply for the financial system and central bank of the future. They pinpoint the key trade-off for central banks in the digital era: they can operate either complex technical infrastructures (in the single-tier business model) or complex supervisory regimes (two-tier). There are many ways to do so, but all will require the central bank to develop substantial technological expertise.
#Fintech#CryptoAssets#CBDC#DFC
·voxeu.org·
CBDC architectures, the financial system, and the central bank of the future
Digital money – the Riksbank’s e-krona pilot
Digital money – the Riksbank’s e-krona pilot
Sweden's Riksbank provided a brief update on the e-krona pilot it is conducting in partnership with Accenture. The pilot project’s technical solution is based on distributed ledger technology (DLT). It is based on a distribution model in which only the Riksbank can create e-kronas, which are then distributed to the general public via participants in the e-krona network, for example banks and payment service providers. The solution will be evaluated in a test environment that will simulate the Riksbank’s internal systems, participants in the network and end users, such as consumers and merchants.
#Fintech#CryptoAssets#CBDC#DFC
·riksbank.se·
Digital money – the Riksbank’s e-krona pilot
Consensys Selected as Technology Partner by the Bank of Thailand for CBDC Project
Consensys Selected as Technology Partner by the Bank of Thailand for CBDC Project
ConsenSys has joined the Bank of Thailand to explore the potential of blockchain technology in the development of a proof-of-concept prototype for a Central Bank Digital Currency (CBDC) project, alongside SCG and Digital Ventures (DV). The private-permissioned network on Hyperledger Besu will be designed to meet both the functional and non-functional requirements of a retail CBDC. One of the business cases will test the use of a CBDC to simulate daily commerce, automate payments, and support procurement and financial management system called Procure-to-Pay (B2P) developed by DV. In the exploration, CBDC will be tested and issued using ERC20 smart contracts. In partnership with Thailand partner Atato, ConsenSys will architect a solution using its Enterprise Ethereum stack, including ​Codefi​ and ​MetaMask​
#Fintech#CryptoAssets#CBDC#Ethereum#ConsenSys#DFC
·consensys.net·
Consensys Selected as Technology Partner by the Bank of Thailand for CBDC Project
Christine Lagarde invites public comments on eurozone CBDC
Christine Lagarde invites public comments on eurozone CBDC
ECB President Christine Lagarde invited public commentary on a potential eurozone central bank digital currency (CBDC). “We are still in the review and considerations stage, but we’ve just launched a public consultation so that consumers and Europeans can actually express their preference and tell us whether they would be happy to use a digital Euro just in the way they use a Euro coin or a Euro banknote knowing that it is central bank money that is available and that they can rely upon.” The survey can be accessed here: https://epsilon.escb.eu/limesurvey3/434111?lang=en
#Fintech#CryptoAssets#CBDC#DFC
·cointelegraph.com·
Christine Lagarde invites public comments on eurozone CBDC
Cambodia officially launches quasi-CBDC
Cambodia officially launches quasi-CBDC
So does quasi CBDC = synthetic CBDC? "Bakong does not give users direct access to central bank money, but bakong balances must be matched by banks’ deposits with the NBC, giving bakong a “cash-like” quality. Furthermore, payments are settled instantly across the central bank’s systems."
#Fintech#CryptoAssets#CBDC#PaymentSystems#DFC
·centralbanking.com·
Cambodia officially launches quasi-CBDC
PayPal crypto services to go global early 2021, support for CBDCs coming
PayPal crypto services to go global early 2021, support for CBDCs coming
Senior Paypal executives revealed further details about its plans to aggressively push into the crypto sector next year during the firm’s Q3 2020 earnings call, including plans to support central bank digital currency (CBDC). PayPal’s chief executive said that through its scale and prominence, the company will “help shape the utility of CBDCs” including facilitating interoperability with existing payment rails and fostering acceptance among merchants. Shulman also described the legacy financial system as “not working” for many ordinary people.
#Fintech#CryptoAssets#CBDC#PayPal#DFC
·cointelegraph.com·
PayPal crypto services to go global early 2021, support for CBDCs coming
Mastercard President Says Crypto Patents Will Pay Off When Central Bank Digital Currencies Arrive
Mastercard President Says Crypto Patents Will Pay Off When Central Bank Digital Currencies Arrive
Mastercard President Michael Miebach said the payments processor’s massive trove of cryptocurrency patents will give it an edge once central bank digital currency (CBDC) debuts, during the firm's Q3 2020 earnings call. "The link into an acceptance network is critical" for a CBDC, he said. "So we hold some patents in [the crypto] space that link these transactions right back into our network where it can be used. And this is how we can bring value, and it brings value to us."
#Fintech#CryptoAssets#CBDC#MasterCard#DFC
·coindesk.com·
Mastercard President Says Crypto Patents Will Pay Off When Central Bank Digital Currencies Arrive
A model for central bank digital currencies: Do CBDCs disrupt the financial sector?
A model for central bank digital currencies: Do CBDCs disrupt the financial sector?
While central bank digital currency (CBDC) offers several benefits, many suggest they might disintermediate commercial banks and facilitate bank runs. To analyze these concerns, this paper uses a New Keynesian DSGE framework to study the effects of interest- and non-interest-bearing CBDCs in times of financial crises and their interaction with the zero lower bound (ZLB). Additionally, it studies the role of central bank funding and a rule-based interest rate on CBDCs. It finds that CBDCs indeed crowd out bank deposits and affect bank funding. However, this crowding-out effect is not necessarily a threat to financial stability and a cause for economic disturbances when the central bank chooses an adequate policy.
#Fintech#CryptoAssets#CBDC#DFC
·papers.ssrn.com·
A model for central bank digital currencies: Do CBDCs disrupt the financial sector?
BitMint Digital Payment Without Network Communication
BitMint Digital Payment Without Network Communication
Identity-bearing digital money can be paid in a private transaction between payor and payee without reliance on network authentication. The payee must trust that the paid digital coin is bona fide. Presenting a hard wallet (HW) to generate the required trust. Payment issued from the HW can be taken in by a second hard wallet, which will further pay to a third hard wallet, creating a payment ecology of digital money for long periods without the benefit of a communication network. Payment may be tethered to eventual terms of redemption. The hard wallet may be personalized -- fitted with ownership security capability. The HW may be engineered in conjunction with a smart phone, so people can use a single device as a phone and as an off-line wallet.
#Fintech#CryptoAssets#CBDC#BitMint#UADs#DFC
·ieeexplore.ieee.org·
BitMint Digital Payment Without Network Communication
The demand for safe liquid assets and the implications of issuing a Central Bank Digital Currency for bank funding instruments
The demand for safe liquid assets and the implications of issuing a Central Bank Digital Currency for bank funding instruments
Norges Bank published a third report on central bank digital currency (CBDC) and the Bank will publish another report early next year, after which it will decide how to proceed with its CBDC work. However, the prospective introduction of a CBDC is still some way off. The lack of urgency reflects the Bank's view so far that there is no acute need to introduce it. The latest paper considers the potential impact on the stability of the financial system through the effect of CBDC issuance on bank funding markets. It concludes that CBDC has the potential to substantially crowd out bank funding instruments due to its superior safety features.
#Fintech#CryptoAssets#CBDC#DFC
·norges-bank.no·
The demand for safe liquid assets and the implications of issuing a Central Bank Digital Currency for bank funding instruments
Central bank digital currency and real-time payments
Central bank digital currency and real-time payments
Norges Bank published a third report on central bank digital currency (CBDC) and the Bank will publish another report early next year, after which it will decide how to proceed with its CBDC work. However, the prospective introduction of a CBDC is still some way off. The lack of urgency reflects the Bank's view so far that there is no acute need to introduce it.
#Fintech#CryptoAssets#CBDC#DFC
·norges-bank.no·
Central bank digital currency and real-time payments
Central Bank Digital Currency: A Literature Review
Central Bank Digital Currency: A Literature Review
The Fed published an article that compiles research exploring the potential impact of central bank digital currency (CBDC) on commercial banking and monetary policy. The review provides a theoretical underpinning for understanding how CBDC could influence consumer adoption and financial stability. It concludes that the models and assumptions in the literature so far provide streamlined frameworks to answer questions about the effects of CBDC at the micro- and macro-levels, while abstracting from many of the complex design issues of interest to policymakers. Avenues for future work include further exploring how the intrinsic features of CBDC as a means of payment and store of value affect the set of feasible allocations in the economy and, in turn, affect its value to heterogeneous households.
#Fintech#CryptoAssets#CBDC#DFC
·federalreserve.gov·
Central Bank Digital Currency: A Literature Review
Lebanon to launch digital currency in face of economic and financial turmoil
Lebanon to launch digital currency in face of economic and financial turmoil
Banque du Liban Governor Riad Salameh reportedly said that the central bank plans to launch a digital currency(CBDC) in 2021 as part of a broader effort to combat a parallel economic and financial crisis that has engulfed the country. The Governor Salameh added that a CBDC will help implement a cashless financial system to enhance the flow of money locally and abroad. http://nna-leb.gov.lb/ar/show-news/513061/
#Fintech#CryptoAssets#CBDC#DFC
·cointelegraph.com·
Lebanon to launch digital currency in face of economic and financial turmoil
Retail CBDC Remuneration: The Sign Matters
Retail CBDC Remuneration: The Sign Matters
This Banque de France paper lists the main options central banks would be faced with when defining their policies regarding the remuneration of retail central bank digital currency (CBDC). It assesses qualitatively the impacts of the choices made on the likely areas of interest for central banks, showing that whether the policy rate and/or the rate on CBDC is positive or null or strictly negative matters. Eventually, the two main policies that stand out are to issue a “banknote-like” CBDC, i.e. not to remunerate it, or to do so following a rule derived from the central bank’s interest rate policy for excess reserves.
#Fintech#CryptoAssets#CBDC#DFC
·suerf.org·
Retail CBDC Remuneration: The Sign Matters
BoE's Cunliffe: Not our job to protect banks against digital currencies
BoE's Cunliffe: Not our job to protect banks against digital currencies
Bank of England Deputy Governor Jon Cunliffe said it was not his job to protect banks from the impact of future digital currencies, which could dramatically reduce households’ willingness to hold money in traditional bank accounts. “Our job is not to protect bank business models,” Cunliffe said at an online seminar. “Banks will have to adjust. Our job is to ensure that if bank business models change, we manage the financial and macro-economic consequences of that.”
#Fintech#CryptoAssets#CBDC#DFC
·reuters.com·
BoE's Cunliffe: Not our job to protect banks against digital currencies
Private Bank Money vs Central Bank Money: A Historical Lesson for CBDC Introduction
Private Bank Money vs Central Bank Money: A Historical Lesson for CBDC Introduction
In this paper, a unique event is studied: the opening of Bank of Canada in 1935, the central bank note issuance monopoly and its impact on the note issuing chartered banks. Between 1935-1950, Canadian chartered banks had to gradually withdraw their notes from circulation. In a difference-in-differences analysis, it shows that chartered banks constrained by new issuance limits experienced higher volatility of return-on-equity in the short run and lower Z-scores and return-on-assets in the longer horizon, suggesting that note issuance was an important source of revenue for private banks and allowed them to smooth the profits. The effect on lending is either non-significant or ambiguous. This study of central bank cash implementation can offer lessons for the current debates on a new form of central bank money - central bank digital currencies - and their potential impacts on commercial banks.
#Fintech#CryptoAssets#CBDC#DFC
·portal.research.lu.se·
Private Bank Money vs Central Bank Money: A Historical Lesson for CBDC Introduction
China to Hold Second Lottery Trial of the Digital Yuan
China to Hold Second Lottery Trial of the Digital Yuan
On December 12, a shopping festival known as "Double 12" in China, the city of Suzhou will reportedly hold a giveaway designed to gauge usability of the digital yuan. The trial will be similar to one held in Shenzhen in October, that allowed residents to apply for a 200 yuan share of 10 million units of the central bank digital currency (CBDC) in a kind of lottery, worth around $1.5 million in total. The Suzhou event will trial additional aspects of the technology not activated in Shenzhen, including the digital yuan's offline feature that allows users to touch smart devices to make transfers.
#Fintech#CryptoAssets#CBDC#DFC
·coindesk.com·
China to Hold Second Lottery Trial of the Digital Yuan
Monetizing Privacy with Central Bank Digital Currencies
Monetizing Privacy with Central Bank Digital Currencies
This NY Fed blog post discusses the implications of introducing a central bank digital currency (CBDC) that offers consumers a low-cost, privacy-preserving electronic means of payment—essentially, digital cash. Central banks are better positioned, relative to private intermediaries, to commit to safeguarding data from outside vendors, because a central bank has no profit motive to exploit payments data. By helping consumers to monetize privacy, central banks would not be proposing a radical transformation to the payments landscape. Rather, they would be preserving aspects of payments that existed prior to the digital revolution. However, this would require regulators and lawmakers to rethink how to adapt current anti-money laundering practices.
#Fintech#CryptoAssets#CBDC#Privacy#DFC
·libertystreeteconomics.newyorkfed.org·
Monetizing Privacy with Central Bank Digital Currencies
Stablecoins: risks, potential and regulation
Stablecoins: risks, potential and regulation
This Banco de España paper written by a couple of Bank for International Settlements staff discusses the regulatory challenges around stablecoins, and in particular potential “global stablecoins” such as Facebook’s Libra proposal. It makes the point that any regulatory responses should take into account the potential of all stablecoin uses, including embedding a robust monetary instrument into digital environments, especially in the context of decentralised systems. Looking forward, in such cases, one possible option from a regulatory standpoint is to embed supervisory requirements into stablecoin systems themselves, allowing for “embedded supervision”. Yet it is an open question whether central bank digital currencies (CBDCs) and other initiatives could in fact provide more effective solutions to fulfil the functions that stablecoins are meant to address.
#Fintech#CryptoAssets#CBDC#Regulation#DFC
·bde.es·
Stablecoins: risks, potential and regulation
Digitalization, retail payments and Central Bank Digital Currency
Digitalization, retail payments and Central Bank Digital Currency
This Banco de España paper written by the Banco Central del Uruguay's Jorge Ponce provides a rationale for central banks to have a deeper involvement in retail payment systems by building and keeping control of core components of these systems, considering competition and financial stability arguments. Central bank digital currency (CBDC) and fast payment systems (FPS) are assessed as alternative tools serving central banks to foster efficiency, resilience and security in retail payments, as well as to preserve financial stability. It concludes that, while central banks should build and keep control of the core components of either a CBDC or a FPS, private sector involvement will be optimal in a tiered architecture where payment services providers compete for customers, innovate and offer overlay services.
#Fintech#CryptoAssets#CBDC#FastPayments#DFC
·bde.es·
Digitalization, retail payments and Central Bank Digital Currency