Snippings

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Christoph Hock from Union Investment gave a convincing rationale for going digital. He should know as Union Investment has been one of the most prolific investors in the space. It invested in both the EIB euro-denominated digital bonds as well as the Siemens one. From today’s talk, Hock gave the impression Union was the sole investor in the initial €100m EIB bond back in 2021.

“Various investors, about 250 participated in the investor education call, but at the end, it was just us getting invested in this paper,” he said. However, the second EIB bond had multiple investors, as did the Siemens bond.

From Hock’s perspective, the benefits are quite clear. Union gets an additional 15 basis point return on a one year bond. So by lowering costs, it results in higher returns to their investors.

From Goldman on tokenization: we’re not allowed to issue on public blockchain – Ledger Insights – blockchain for enterprise:

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Mike Storiale, vice president for innovation development at Synchrony Financial Services. “Palm Pilot users never thought they would want or need a device like the Blackberry, and Blackberry users thought the same about the iPhone initially. The metaverse is chaotic now, but that’s not a bad thing as companies are exploring what they can do in it now, as well as big ideas for down the road.”

From Into the Metaverse – Digital Transactions:

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Another way metaverse platforms can control the movement of money is by making transactions directly between a user’s and a merchant’s digital wallet. In this scenario, the money bypasses traditional processing channels and goes nowhere near the banking system, points out David Birch, a United Kingdom-based author, advisor, and commentator on digital financial services.

“Metaverse payments don’t need the same infrastructure as payments in the physical world because users have the credentials to identify themselves, which helps prevent fraud,” Birch says. “The question for the processors is, what will they do if money in the metaverse moves directly between wallets?”

The answer to that question so far is unclear. Many payments providers, fintechs, and processors have penned articles and blogs, or given interviews, about the potential opportunities in the metaverse. But several of those companies contacted for this story declined comment, arguing the metaverse is still too new to discuss it in anything other than extremely broad terms.

From Into the Metaverse – Digital Transactions:

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Tens of billions of pounds have been lost to fraud since the start of the COVID pandemic, according to the National Audit Office (NAO), with little chance of the majority being reclaimed.

Of the £21bn identified by the NAO to have been lost by the government, more than £7bn is linked to schemes introduced during the pandemic

From £21bn of public money lost in fraud since COVID pandemic began and most will never be recovered | UK News | Sky News:

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Vision paper on digital euro

Intermediaries should also be able to be compensated, beyond the payment-related costs, for providing all digital euro-related services, such as: (a) opening and maintaining digital euro accounts, (b) performing KYC (Know-Your-Customer) procedures, (c) continuous monitoring for AML/CFT1 and anti- fraud purposes, (d) portability services, (e) funding and defunding of the wallet, (f) dispute resolutions. Finally, value-added services provided to payers and payees should be subject to remuneration.

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A new survey from AutoPacific (via Ars Technica) found that consumers generally couldn’t be any less interested in such offerings. For example just 30 percent of those eager to buy a new car said they were interested in paying for their car’s Internet access. And 23 percent said they’d be interested in being able to remotely control some vehicle functions via an app for $10 per month.

From Consumers Aren’t Buying Automaker Plans To Make Everything A Subscription | Techdirt:

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Consumers trust the providers they transact online with most to provide a credentials vault — their bank, PayPal and Amazon.

From Prepaid Debit Cards and Apps Help Seniors Avoid Falling Prey to Hackers and Scams:

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Tinder and Bumble (dating sites) have been ordered to hand over data to the Australian government as part of improving safety.

I was saddened to read that the British Government’s “plan” for a state backed non-fungible token (NFT) to be produced by the Royal Mint (the organisation that makes the physical British coins) have now been dropped.  The Prime Minister Rishi Sunak ordered that creation of a rather pointless and irrelevant “NFT for Britain” a year ago when he was Chancellor (which is what we have called our Minister of Finance since) and while it was never really why anyone would want one, other than as a totem to British Fintech, I was still sorry to see it go the way of the ASX blockchain, FTX and XXX, largely because I was looking forward to making fun of it when it was finally released to the public.

In reality it was no surprise. The era of the pointless NFTs is over. Remember the NFT of Jack Dorsey’s first tweet? That was sold for nearly three million dollars in December 2020 and then resold for nearly three hundred dollars. Not only are the NFTs a bust, some of their promoters might well be soon too. Celebrities ranging from the pop singer Madonna to the American football players Tom Brady and a variety of others (unfortunately I had never heard of most of them and as ChatGPT was down at the time am none the wiser as to the origin of their status) are facing criticism and in some cases lawsuits from “investors” who gambled on a variety of useless tokens and lost their money. Fortunately, Mr. Sunak is now unlikely to meet the same fate.

The Bennet Institute for Public Policy at Cambridge University asked in January 2022, “are NFTs democratizing decision-making, or the next financial mis-selling scandal?”

Well, now we know.

But as the era of the useless NFT draws to a close, the era of the useful NFT is surely beginning.

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There’s a new playing field for financial institutions, and traditional banks face tough competition from other banks and fintech startups that are entering the market with innovative payment solutions. To compete effectively, banks need to invest in new technology and build a mobile wallet strategy that meets the needs of their customers. T

From Why Banks Need to Build a Mobile Wallet Strategy to Defend Against Apple – Liminal.co:

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By prioritizing user experience, security, and integration with other services, banks can build mobile wallet solutions that meet the needs of their customers and provide a strong defense against the rise of Apple Pay.