Snippings

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In the real world, Switzerland is preparing a national digital identity, and issues of privacy have been prominent, especially as the Digital Identity and Data Sovereignty Association (DIDAS) has been working with the Swiss government to ensure users cannot be tracked through the e-ID. “Switzerland actually works very hard in ensuring unlinkability of you moving across the web,” Daniel Säuberli, president of DIDAS, said in May.

From: Microsoft introduces ZKPs with unlinkability to preserve digital ID privacy | Biometric Update.

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In 1758, an English mail coach carrying banknotes was robbed. The robber used one of the stolen banknotes to pay for a room at an inn. The original owner of the banknote asked the Bank of England to stop payment of the note, whereupon the innkeeper sued. The case of Miller v Race rose to England’s highest court judge, who ruled that the innkeeper was the rightful owner of the banknote.

The judge, Lord Mansfield, opined that if a merchant always had to question whether there might be an upstream property interest in a banknote then the notes could not be used to grease the wheels of commerce. Therefore a banknote made out to bearer and payable on demand must be treated as currency — a medium of exchange.

Fast forward to today and a popular form of cryptocurrency called stablecoins is facing challenges similar to those faced by banknotes in 18th-century England.

From: Stablecoins should be treated as currency.

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On September 27 1825 a steam train crowded with excited passengers travelled 26 miles from Shildon via Darlington to Stockton in north-east England. It broke down on route, and one man fell off and had his foot crushed. But the journey is recognised as the birth of the railway age, which was to transform human mobility, business and social life around the globe.

From: A new age of the train.

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Every transaction is laden with inherent risks (credit risk, fraud risk, settlement risk) and is subject to a dense web of regulatory obligations that technology alone cannot address. Thus payment networks’ core purpose is to create trust and certainty.

From: Governance in Payments | Noyes Payments Blog.

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The bull case for disruptive network growth revolves around a significant expansion in the type of commercial interactions that the card networks can manage (ie, governance). See Networks, Value Assembly and Organizational Structures
Governance is MORE importance in the age of AI and Agents as machine to machine trust is even HARDER to manage.

From: Governance in Payments | Noyes Payments Blog.

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I will argue that card networks have a significant opportunity to expand their governance, both in non card and in non-payment.

From: Governance in Payments | Noyes Payments Blog.

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For VCs to be viable beyond low-risk use cases, they must be embedded within a governance framework that provides the “commercial accountability” to complement the “cryptographic assurance”.

From: Governance in Payments | Noyes Payments Blog.

Indeed. The core issues of liability and interchange must be agreed if we are going to see any progress at all. Now, it is clearly not beyond the bounds of human ingenuity to come up with an optimisation to balance the interests of the stakeholders with the interests of society as a whole. One ancient template for such might be found buried in the sedimentary layers of digital identity from the early days. Identrust opted for a (bank-centric) model of transactional liability. In other words, if you say that I am Dave Birch, and I use that credential to get a loan, and it then turns out I am not Dave Birch at all, then you should be liable for the loan default, but not for any contingent liabilities.

This must be linked to an interchange model that maybe charges different interchanges amounts depending on the nature of the transaction, not the size of the transaction. Buying a beer with proof of age, 0.002 cents. Buying a house with proof of mortgage offer, $20 or something.

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Big Tech groups are losing a political battle in Brussels to gain access to the EU’s financial data market, despite Donald Trump’s threats to punish countries that “discriminate” against US companies with higher tariffs.

With the support of Germany, the EU is moving to exclude Meta, Apple, Google and Amazon from a new system for sharing financial data that is designed to enable development of digital finance products for consumers.

Such a decision would hand a significant boost to banks in their efforts to fight off a competitive threat from Big Tech groups, which they fear will use their data to disintermediate them from their customers while extracting much of the value of knowing people’s spending and saving behaviour.

After more than two years, negotiations on the Financial Data Access (FiDA) regulation are entering the final stages in coming weeks, with Big Tech groups facing almost certain defeat, according to diplomats.

From: EU to block Big Tech from new financial data sharing system.

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In the UK, one in four people aged 18 to 34 own crypto, according to a survey last year. Men are three times as likely to do so than women. The London thieves’ tactics seem to target this demographic

From: Your phone gets stolen. Your crypto may be next.

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PayPal’s investment comes as part of Stable’s $28 million seed funding round, which saw participation from Bitfinex and Hack VC.

In addition to the investment – the size of which was not disclosed – Stable users will be able to use PayPal’s PYUSD stablecoin for commerce and financial transactions on the Stablechain.

From: PayPal invests in Stable layer 1 blockchain.

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