Snippings

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I was quoted in The Economist (“Plug and pay”, 21st November 2019) talking about the impending reshaping of the retail financial services sector. Although the quote isn’t quite accurate — I was responding to the statement that a a bank is a balance-sheet, a factory that turns capital into financial products (such as loans and mortgages) and a sales force, I didn’t make the statement — the paraphrase is correct. Those first two activities are heavily regulated, as they should be, which is why Big Tech is uninterested are in them. They are more than happy to have banks, for example, do this boring, expensive and risky work with all of the compliance headaches that come with it.

From The real “challenger” banking business model is data, not money | 15Mb:

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BofA Securities, amongst others, have pointed out that there is a “huge and valuable prize for private-sector players” from outside the banking sector can get in to the payments business: the “treasure trove” of customer data that is not being fully exploited by the banks.

From A digital euro would be ‘crypto kryptonite’ for fintechs and a threat to banks, a critical new report warns | Fortune:

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New York’s Metropolitan Transit Authority (MTA) is to phase out its thirty-year old MetroCard in 2023 in favour of contacless payment acceptance across its network.

From MTA to phase out MetroCard as contactless payments pick up:

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Last year, the European Council on Foreign Relations (a think tank on European foreign and security policy, co-chaired by former Swedish Prime Minister Carl Bildt as co-chair) put forward a “tool kit” for European policymakers to make Europe more 

One of these was a call for digital currency. The ECFR suggested that a digital would deliver “greater resilience from economic coercion” and to reduce third-country insights into European financial transactions.

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ncompetence and snooping could taint the whole idea of vaccine passports and provide grist to covid-conspiracists’ mill. But privacy worries are not insurmountable. David Chadwick, formerly a computer-science professor at Kent University, in England, is the boss of a spin-off company called Verifiable Credentials. Before the covid-19 pandemic, his firm was working on a privacy-focused scheme for workplace identity cards, parking permits, concert tickets and the like. “I wasn’t thinking about health applications at all,” he says. These days covid-19 is his priority.

The idea is to ensure there is no connection between the source of a person’s vaccination data and the entity requesting it. Individual users are linked securely with their smartphones using biometrics and some form of government-issue identity document, a process similar to registering for mobile banking. A user seeking entrance to a “covid-secure” venue would have entry rules transmitted to their phone at the door. The app would check those rules against the user’s data and spit out a simple “yes” or “no”—and nothing else. Specifics such as a person’s name, age, address, the date of their vaccination and the like would not be reported, limiting the opportunity for mischief.

In April 2020 Verifiable Credentials demonstrated that its prototype would be able to verify vaccine status and covid-test results, as soon as those things existed. Its app is being tested with dummy data at a cinema that actors are using as a rehearsal space, and with real data at a British hospital, where it has replaced existing paper-based methods. The firm is also working on a physical version for use by those without smartphones.

From Papers, please – Are vaccine passports a good idea? | Science & technology | The Economist.

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Real property is a useful analogy.  An NFT is like a deed to a house.  A deed is not the house itself, but a record of ownership of the house.  In the same token (see what I did there?), an NFT is not the digital asset itself, but an electronic record representing ownership of the asset.  That said–and this is an important distinction–owning an NFT does not necessarily mean that you own the asset underlying the NFT.

From A Primer on NFTs and Intellectual Property, Jeremy Goldman.

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Ram Rastogi, who I always listen to on such matters, notes that Amazon in India is not only launching a digital banking platform to compete with the incumbent banks but is also applying for a licence to run a payments system as well. The Reserve Bank of India has invited companies to create new umbrella entities (NUEs) to build payments networks that offer an alternative to the bank-owned not-for-profit National Payments Council of India (NPCI) and Amazon are doing so in a consortium with Axis Bank and ICICI Bank. Amazon are not the only ones in this game, of course. Facebook and Google are linking with local players Infibeam and Reliance Industries to set up a competing network.

With the bank and the payment network, Amazon will be able offer their sellers a full service, ranging from current accounts and deposits to business loans and payments management, all through their own interface. The customers will never have to go near a conventional bank, a payments application or anything else. Not only are they launching their own banking system in India, they are apparently looking to launch their own money in Mexico.

I know nothing about running a bank, but if anything is going to keep me awake at night, it’s not banks.

I was thinking that after I pull off a major cryptocurrency scam (I haven’t decided whether to launch a bogus token or run a scam art market or get into ransomware big time yet) and manage to get out of the consulting business for good, then Fiji might be an idyllic bolt hole from which to enjoy my ill-gotten gains to the end of my days. So you can imagine how upset I was that the government of Fiji is proposing a new Police Bill to give the forces of law and order the ability to “seize any digital currency that has been derived from a criminal activity”.

Fortunately for the Fijian thin blue line, the blockchain makes it easy trace the provenance of Bitcoins to see whether they have been “derived from a criminal activity”. So if they examine my stash and find cryptocurrency that originates from an Iranian bitcoin mine or a mixer, they’ve got me bang to rights. But how would they “seize” the virtual loot?

My meager cryptoscraps are stored on my new BitBox2 USB-C hardware wallet with microSD backup. The hardware wallet is wrapped in old socks inside an empty baked bean can that is hidden in my garbage can. The microSD backup is sown into the seam of a Mötorhead 1978 UK tour sweatshirt that remains one of my prized possessions. I think my coins are pretty safe from the long arm of the law, but supposing crack teams of detectives working around the clock do get hold of one or the other of these repositories, then what?

If they ask me for the password then I’ll tell them I’ve forgotten it (which will almost certainly be true by then). How will they know whether I’ve really forgotten it or whether I’m not telling them or whether I wrote it down and hid it in a fishing rod that is lost or whether I got someone else to look after the password for me?

At first, this may seem straightforward. After all, if you get arrested for something and tell the police that you forgot the PIN for your phone then you can be sent to jail.

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Europe Struggles to Defend Itself Against a Weaponized Dollar
Despite warm words from Biden, U.S. secondary sanctions against Iran, Russia and others punish European companies and prompt new calls for strategic autonomy.

From Europe Struggles to Defend Itself Against a Weaponized Dollar – The New York Times:

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Last year, the European Council on Foreign Relations (a think tank on European foreign and security policy, co-chaired by former Swedish Prime Minister Carl Bildt as co-chair) put forward a “tool kit” for European policymakers to make Europe more 

One of these was a call for digital currency. The ECFR suggested that a digital would deliver “greater resilience from economic coercion” and to reduce third-country insights into European financial transactions.

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EA makes most of its FIFA money from the game’s Ultimate Team mode, where fans spend real money in attempts to unlock elite players. Today, it’s being alleged that these lucrative items are being sold privately to users by employees within EA Sports.

Using the hashtag #EAGATE, complaints have been made that someone within EA has been selling FIFA’s Prime Icon Moment players for huge sums of cash, like €1000 (USD$1190) for two players.

From EA Investigating Claims An Employee Has Been Selling Rare Items:

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