Snippings

Programmable payments are a great idea and there are surely some amazing new businesses that will be built of top of such functionality. There are not, however, as the President of Deutsche Bundesbank recently said “necessarily” a case for a retail CBDC. As he points out, an alternative solution might be for the private sector to tokenise commercial bank money and the EU’s “MiCa” regulations include a suitable framework for doing this, which is the industrial money solution favoured by the German banks. This is quite different from wholesale CBDC issued by the ECB itself. Such a commercial CBDC could “complement” innovative ways of exchanging and settling financial assets and, given that the tokenisation of assets is becoming increasingly prominent in the world of finance, deliver important benefits.

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Customer data can help to improve the services of platforms or to better target advertising. But they are also a treasure trove that can help platform providers to eke out a competitive edge in other markets. Moreover, by creating entire ecosystems, bigtech firms could enhance network effects and customer experience, thereby stimulating user activities, which generate yet more data.

From Exploring a digital euro | Deutsche Bundesbank.

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But airlines have another way to ensure that their programmes stay profitable: they can deflate the value of their miles. In the early 2010s American airlines began to calculate the value of a mile based on a complex formula of fares and routes. In 2015 Delta Air Lines stopped disclosing how the value of its miles was calculated and embarked on a series of devaluations, prompting competitors to follow. In the past year or so Delta, Southwest and United have devalued miles on major routes by 6-20%.

From Frequent-flyer schemes provide airlines with a lifeline | The Economist:

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Visa and Mastercard boast consistently steep ebitda margins — 60-70 per cent. These point to a market failure.

From Amazon/Visa: duopolists finally face a bigger, uglier challenger | Financial Times.

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There are a number of Request to Pay schemes, including PayUK and The European Payments Council, but it has yet to be fully launched.

PayUK estimates the service could save the UK economy over £1.3bn a year, so what do fintechs need to know about this new way of requesting payments?

It’s an alternative to cards, invoices and direct debits

For la Cour, Request to Pay is “one of the payment methods that could actually revolutionise the way payments are done” because it offers an alternative to cards. According to the European Central Bank, payment cards still total more than half of all non-cash transactions in Europe.

From Everything you need to know about Request to Pay | Sifted.

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Amazon will stop accepting Visa credit cards issued in the UK from 19 January, the online retail giant has said.

From Amazon to stop accepting Visa credit cards in UK – BBC News.

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What exists now is an expensive, power-hungry, distributed, online gambling system. The house still always wins, but it’s not totally clear who the house is, which is how the house likes it.

From 10 years of… whatever this has been – apenwarr.

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I’ve been looking through some of the non-fungible token (NFT) horoscopes around at the moment and they are universally bullied. Morgan Stanley, for example, say that the market could reach a $240 billion by 2030 with luxury-branded NFTs accounting for $56 billion of that. 

 

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Markets can’t operate without clear property rights: Before someone can buy a good, it has to be clear who has the right to sell it, and once someone does buy, you need to be able to transfer ownership from the seller to the buyer. NFTs solve this problem by giving parties something they can agree represents ownership.

From How NFTs Create Value:

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NFTs as collateral. The metaverse is here,

Lastly, we have platforms like NFTfi that are offering NFT collateralized loans. By putting up any ERC-721 token up for collateralization, other users can begin offering you a loan. Once accepted, the ETH gets paid to you and the NFT is locked in the NFTfi smart contract, only to be returned once your loan is paid. If you can’t pay back the loan then the NFT is then transferred to the lender. NFTfi has already supplied nearly $4 billion USD in loans.

From Web3 Report Q3 2021:

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In what could be seen as historic step toward the legitimization of the metaverse, the island nation of Barbados is preparing to legally declare digital real estate sovereign land with the establishment of a metaverse embassy.

From Barbados to Become First Sovereign Nation With an Embassy in the Metaverse:

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The Maldives on Tuesday became the first country to open an embassy in the virtual reality of web-based Second Life, a fantasy world inhabited by computer-generated residents, the Maldives mission to the United Nations in Geneva said.

From Maldives opens first virtual embassy on Second Life:

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The cost to businesses of processing card payments in the UK is greater than it should be, and it is too difficult for those businesses to switch between intermediaries that link them into card payment systems, a UK regulator has found following an extensive review.

From UK regulator raises concerns over cost of processing card payments:

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