Snippings

xxx

We should instead focus and debate the salient CBDC-related topics, like its effects on financial stability, payment system improvements, and financial inclusion.

From Speech by Governor Waller on the U.S. dollar and central bank digital currencies – Federal Reserve Board.

xxx

xxx

Also, because stablecoins are pegged to the dollar, they may increase rather than reduce the primacy of the dollar abroad, since demand for stablecoins increases demand for dollar-denominated reserve assets held by the stablecoin issuer.

From Speech by Governor Waller on the U.S. dollar and central bank digital currencies – Federal Reserve Board.

xxx

xxx

I am highly skeptical that a CBDC on its own could sufficiently reduce the traditional payment frictions to prevent things like fraud, theft, money laundering, or the financing of terrorism

From Speech by Governor Waller on the U.S. dollar and central bank digital currencies – Federal Reserve Board.

xxx

xxx

Researchers from a Chinese state-run think tank have floated the idea of an Asia-wide digital currency with the aim of reducing its reliance on a United States dollar-based economy.

The views of researchers Liu Dongmin, Song Shuang and Zhou Xuezhi from a unit of the Chinese Academy of Social Sciences (CASS) were published in an issue of the World Affairs journal posted online in late September, who said the establishment of an Asian yuan token would lower Asia’s reliance on the USD.

Much like similar existing and trialed central bank digital currencies (CBDCs), the researchers said distributed ledger technology (DLT) would form the backing of the Asian token, which would be pegged to a bundle of 13 currencies.

The currencies would include those of all 10 of the member nations in the Association of Southeast Asian Nations (ASEAN) along with China’s yuan, Japan’s yen and South Korea’s won, according to the researchers.

From China floats idea of ‘Asian yuan’ to reduce reliance on US dollar:

xxx

xxx

Our six Deutsche Bank experts believe that the most likely future scenario in the future is one of multiple metaverse ecosystems, but which allow interoperability through standard solutions and protocols for digital identity, credentials, and asset ownership. The metaverse could usher in the next e-commerce revolution as it gains traction through advances in technology and becomes more mainstream. Financial services firms have a significant role in powering this evolution.

From Metaverse – the next e-commerce revolution – Corporates and Institutions:

xxx

xxx

“I hope Musk cleans up Twitter,” the JPMorgan
CEO told CNBC’s Julianna Tatelbaum, adding he thinks Musk should look into eliminating anonymous accounts from the site.

From Jamie Dimon says Musk should ‘clean up Twitter,’ echoes bot concerns:

xxx

xxx

The European Central Bank (ECB) will collaborate with five companies to develop potential user interfaces for the digital euro.

The aim of this prototyping exercise is to test how well the technology behind a digital euro integrates with prototypes developed by companies. Simulated transactions will be initiated using the front-end prototypes developed by the five companies and processed through the Eurosystem’s interface and back-end infrastructure. There are no plans to re-use the prototypes in the subsequent phases of the digital euro project.

Together with the ECB team, the selected companies will each focus on one specific use case of a digital euro:

peer-to-peer online payments – CaixaBank;
peer-to-peer offline payments – Worldline;
point of sale payments initiated by the payer – EPI;
point of sale payments initiated by the payee – Nexi;
e-commerce payments – Amazon.

From ECB selects external companies for joint prototyping of user interfaces for a digital euro:

xxx

xxx

For example, between June and November 2021, the number of physical skimming devices on ATMs and point-of-sale (POS) terminals soared 176% compared to the previous 12-month period, Visa reported Thursday (Oct. 6) in a press release sent to PYMNTS.

At the same time, the online fraud that accelerated so quickly during the pandemic remains the biggest threat, with Visa’s Global Risk team finding that nearly three-quarters of fraud and data breach cases involve eCommerce merchants, according to the release.

From :

xxx

As Simon Taylor pointed out recently, right now consumer fintechs are trading at around 2.2x revenue (for comparison, PayPal is at about 4.5x revenue) and financial marketplaces at 1.1x revenue. Meanwhile, financial data players are at 8.7x against McKinsey’s estimate of the not even 1x of traditional banks because the market clearly sees data as central to the future of the sector.

Why this multiple? Well, the use and reuse of data is central not only to the future of fintech but economic growth as a whole, given that the data economy (however defined) is a decent chunk of the overall economy.

xxx

And, more recently, the CFPB took measures to increase federal oversight of the fintech industry, with the announcement of a new use for old authority, known as 1024, to supervise non-bank companies that it believes pose risks to consumers.

By invoking 1024 authority, the CFPB is looking to “level the [regulatory] playing field” between banks and certain fintech companies not currently subject to federal oversight. Importantly, the CFPB views “uncontrolled flows of consumer data” as risky and may recommend, through examination, that covered entities establish secure data-sharing methods (i.e., APIs) with third parties, including depositories.

From From trusted stewards of money to data | Bank Automation News:

xxx

 

We don’t want data to be locked down and hoarded, we want it to flow. But this introduces a conflict that must be resolved: we want data to flow, but we want privacy and security to be maintained. But how? How can a bank persuade me to share more of my data, while simultaneously keep my personal information secure?

The consultants McKinsey have just published a “Technology Trends Outlook for 2022” which identifies trust architectures and digital trust as one of their key area of focus. I rather like their use of the phrase “privacy engineering” to encompass the techniques used to enable oversight, implementation, operation, and maintenance of privacy in order to deal with reduce risks to data privacy, improve resource allocation and embed privacy enablement into existing systems. As long time advocate of the use of priavacy-enhancing technologies (PETs) in the infrastructure for the digital economy, I am very happy to see mainstream management consulting take up the cudgel for change in this area.

I am actually very optimistic about what is going on this area because the new technologies that we now have at our disposal, the technologies of what I’ve labelled “counterintuitive cryptography”, give us the ability to deliver the apparently contradictory goals of privacy and sharing. To illustrate this point using the simplest of examples, it is trivial in the world of cryptography to deliver to a bar an unforgeable proof that I am over 18 without disclosing my age or my date of birth.

xxx

The letter reflects frustration among some fintechs who argue that if consumers were able to share their full financial data with them, they could better offer money-saving services including personalised spending insights, ways to manage credit card debt and cheaper payment methods.

From Fintechs say UK credit cards restrict access to consumers’ own data | Financial Times:

xxx