Fintech Daily Digest

"Central banks cannot operate retail digital currencies. Who do you call when you forgot your password? But narrow banks are the ideal institutions to provide the retail-facing end of digital currencies. The sooner the better. Unless we can persuade the Treasury to offer reserves first and take this all away from the Fed."

The Malaysian Securities Commission has ordered 19 crypto trading platforms to cease operations in the country and return funds and assets to investors, effective June 1.

Malaysia's securities commission has begun registering cryptocurrency exchanges after it started regulating the crypto space earlier this year. The first three crypto trading platform operators have been conditionally approved and given nine months to comply with registration requirements.

The Ernst Young FinTech Index, which has been going since 2015, is back for its 2019 edition. The publication interviews more than 27,000 consumers in 27 markets to take the pulse on where fintech is at. Unsurprisingly, the sector is thriving, or in EY's words, innovation has now 'become the new normal.'

Last week the "foundation" behind Kik, the company that raised almost $100m in an ICO in 2017 for the "Kin" token, set up a new website: defendcrypto.org to raise money to "take on" the SEC in court, by fighting against the idea that Kin tokens constitute securities, and arguing instead that they function as a currency.

The SEC is not claiming fraud, or even misrepresentation, on the part of Kik - they are only claiming that Kik made and sold an unlicensed offering of securities in the US.

Chinese cryptocurrency exchanges facilitate 60% of all stablecoin tether trading globally to Diar. Chinese exchanges in 2019 thus far account for over $10 billion in USDT trading. The US accounts for only $450 million of USDT traded.

The Marshall Islands today announced the establishment of the SOV Development Fund, a not-for-profit organization set up to support the government in the establishment, maintenance and implementation of the SOV digital legal tender.

IOSCO suggests that any crypto assets considered securities should follow the same regulatory principles as conventional securities but does not provide guidance on how to define crypto assets as securities in the first place.

The U.S. SEC is suing Kik for allegedly running an unregistered securities sale when it launched an initial coin offering for its kin token in 2017. In a filing submitted June 4 in the Southern District of New York, the SEC said Kik violated Section 5 of the Securities Act of 1933, which requires offerings to be registered.

Bitcoin price fell below $8000 for the first time in over a week on June 4 after several huge transactions appeared to move markets artificially.

Bitcoin supply holdings have shifted ever since reaching the recent bottom. The most significant pattern that has emerged is that of Institutional investors scooping up massive amounts of digital assets at these discounted prices.

Darrell Duffie examines key issues around the introduction of digital currencies and faster payment systems, including financial inclusion, payment system efficiency, control by central banks of monetary policy transmission, privacy and anti-monetary laundering, and competition for banking services.

The ECB and BoJ published the outcome of Poject Stella, their joint research on DLT-based synchronised cross-border payments system. It concludes that the safety of today's cross-border payments could potentially be improved by using payment methods that synchronise payments and lock funds along the payment chain, but further reflections on legal and compliance issues, the maturity of the technology and a cost-benefit analysis would be required before the possible implementation of such new methods could be considered.

The number of open contracts for the Chicago Mercantile Exchange's (CME) bitcoin (BTC) futures is reportedly at an all-time high.

Major cryptocurrency exchange Binance is apparently testing a British pound stablecoin on its native blockchain, Binance Chain.

The root cause of last Sunday's Google outage was a configuration change for a small group of servers in one region being wrongly applied to a larger number of servers across several neighboring regions.

Brazilian banks will be implementing a new standardized blockchain identity solution co-developed by IBM and the central bank, CIP. It is reportedly to be integrated into the Brazilian Payment System.

Central bank digital currencies could bring profound changes to the financial system, potentially crowding out commercial banks. They could also change the way monetary policy operates. The implications for monetary and financial stability need careful consideration.

US Crypto exchanges that plan to attain the status of alternative trading systems via becoming, partnering with, or purchasing broker-dealers could have to forgo their digital custody business due to the Securities Investor Protection Act.