Snippings

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The department for digital, culture media and sport is due to publish a digital strategy that draws together many of the government’s existing tech policies into one document, according to people familiar with the contents of the 50 page paper.

The strategy is expected to say the UK needs to strengthen its position as a global science and tech superpower, highlighting areas including AI, quantum computing and next generation semiconductors.

From UK to unveil new digital strategy to nurture technology sector | Financial Times.

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Japan’s parliament passed a bill on Friday that clarified the legal status of stablecoins, defining them essentially as digital money. Stablecoins must be linked to the yen or another legal tender and guarantee holders the right to redeem them at face value, according to the new law.

From Japan Passes Crypto Stablecoin Bill That Enshrines Investor Protection – Bloomberg.

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Stablegains’ website had stated they primarily generated yields through the asset-backed stablecoin USDC. However, after the collapse of Terra, Stablegains admitted that “All users’ holdings are in UST”—which lost over 90% of its value.

From Web3 is going just great.

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Imagine if you went on a first date, and when you paid them back for your half of the meal, they could now see every other transaction you’d ever made

From Cautionary Tales from Cryptoland.

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signatories to a damning open letter on crypto to congressional leaders include cryptographer Bruce Schneier, Google Cloud principal engineer Kelsey Hightower and Netscape developer Jamie Zawinski.

“We urge you to resist pressure from digital asset industry financiers, lobbyists, and boosters to create a regulatory safe haven for these risky, flawed, and unproven digital financial instruments,” the letter reads.

From Crypto ‘risky, flawed and unproven’ — tech experts | Financial Times:

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The Bank of England will take over collapsed “stablecoin” companies to prevent a cryptocurrency crash hitting financial stability, under Treasury plans.Stablecoin issuers would be placed into special administration by the Bank to protect consumers if they fail, a Government consultation said on Tuesday.The proposals would mean companies offering stablecoins, cryptocurrencies designed to hold their value, would fall under similar rules as banks and other systemic institutions.The Treasury plans to recognise stablecoins as a legal form of payment under efforts to make Britain a “crypto hub”.Stablecoins’ backers say they offer potentially faster and more efficient payments than existing systems, but their…

From Bank of England to take over collapsed stablecoin cryptocurrencies.

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Wirecard

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A new research paper by Ben Charoenwong, Robert M. Kirby and Jonathan Reiter says that the only type of stablecoin that can guarantee to hold its USD peg under all conditions – and therefore be a credible safe asset – is one that is fully backed by hard dollars in the manner of a currency board.  Algorithmic stablecoins like UST cannot be guaranteed to hold their pegs under all conditions. For fractionally-reserved stablecoins, overcollateralization (holding a portfolio mix of safe and risky assets whose total market value exceeds that of the stablecoins in issuance) offers some protection, but bleeds value over time. In some state of the world, therefore, even overcollateralized stablecoins can lose their reserve backing and fall off their pegs (or be forced off them).

From There’s no such thing as a safe stablecoin.

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In a recently published paper, “Decentralized Society: Finding Web3’s Soul,” co-authored with Flashbots’ Puja Ohlhaver and Microsoft’s Glen Weyl, Vitalik Buterin outlined a kind of non-transferase NFT that could be used as a sort of living, transparent and immutable curriculum vitae (CV).

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A new research paper by Ben Charoenwong, Robert M. Kirby and Jonathan Reiter says that the only type of stablecoin that can guarantee to hold its USD peg under all conditions – and therefore be a credible safe asset – is one that is fully backed by hard dollars in the manner of a currency board.

From There’s no such thing as a safe stablecoin.

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Hong Kong is pushing ahead with its exploration of a retail central bank digital currency, launching a discussion paper on the policy and design aspects of a potential e-HKD.

Last year the Hong Kong Monetary Authority released a technical white paper on a possible e-HKD, looking at design options for issuing and distributing retail CBDCs, including an arrangement that allows transaction traceability in a privacy-amicable manner.

From Hong Kong publishes CBDC discussion paper.

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