Fintech Daily Digest

Sveriges Riksbank published positive feedback from 20 Swedish institutions and organizations on its 2nd e-krona report, including from the Finansinspektionen, the National Debt Office and the national tax agency. However, most entities called for a government inquiry; something the central bank has requested.

To help clarify Fintech regulatory positions and move policy forward, French and German regulators have started a variety of initiatives, ranging from novel legislation in France to preliminary expert hearings in Germany. France has paved the way with the "PACTE bill" and a new regime for crypto-asset players. Germany is taking a similar path with a public consultation launched by a cooperation of the Ministry of Finance and the Ministry of Justice in early March.

Markus Brunnermeier and Dirk Niepelt argue that concerns about central bank digital currency choking investment, cutting into banks' profits, or increasing the likelihood of bank runs are misplaced.

According to IBM, World Wire is the first blockchain network of its kind to integrate payment messaging, clearing and settlement on a single unified platform. Participants are also allowed to dynamically choose from a variety of digital assets for settlement. Currently, World Wire has enabled payment locations in 72 countries, with 48 currencies and 44 banking endpoints.

The Bahamas CBDC pilot is scheduled to be introduced in the remote Exuma district in 2020. The central bank is currently finalising the contractual onboarding of its chosen technology solutions provider, NZIA. Be cause the CBDC aims to complement and not replace existing banking services, the currency will not be interest-bearing. However, users may be able to invest in government securities via the CBDC wallet.

IBM said at least two major U.S. banks are considering whether to follow JPMorgan Chase & Co.'s lead in issuing a stablecoin. IBM said it is also working with six non-U.S. banks on digital currencies, including BNK Financial Group Inc.'s Busan Bank in South Korea, and in the Philippines, Rizal Commercial Banking Corp., which is expected to issue a stablecoin in the second quarter. The banks are awaiting approvals from regulators.

The choice of Stellar is a bit surprising given that IBM has been working with the Linux Foundation on Hyperledger Fabric for years. But Hyperledger Fabric is permissioned, private distributed-ledger technology. IBM wanted something more open that any organization could join if it met certain criteria. In World Wire, IBM has created kind of a virtual private network within Stellar. Organizations can register assets and become part of the network, but IBM carefully vets each participant and validator. By contrast, Ripple says it does not know who runs the validator nodes on its distributed ledger. It's really about knowing the validators, but without creating this walled garden that you have to have special permission to join.

The Everex eTHB stablecoin is equivalent to one Thai Baht and powered by Ethereum smart contracts. It is the main component of the Everex Wallet application, which allows users to deposit, send, receive and withdraw cash or transfer funds to a bank account in a number of DFC stablecoins representing different national currencies.

WeTrust is an Ethereum-based decentralized financial services platform. WeTrust's first product is a Trusted Lending Circle (TLC) platform. A TLC a group of individuals who agree to meet for a defined period in order to save and borrow together. TLCs are commonly built along clan, geographical, social, or professional networks. These organizations have a variety of different names such as: tontine (Cambodia), susus (Ghana/ Caribbean Islands), tandas (Latin America), hui (China), chit funds (India), cundinas (Mexico), etc... https://www.philadelphiafed.org/-/media/community-development/publications/discussion-papers/discussionpaper-ROSCAs.pdf

Six international banks have signed letters of intent to issue fiat-backed stablecoins on World Wire, an IBM payment network that uses the Stellar public blockchain. The network promises to let regulated institutions move value across borders more quickly and cheaply than the legacy correspondent banking system.

One of the oldest bank-backed cryptocurrency efforts is no more as Citibank has confirmed its JPMCoin-like Citicoin project has been shelved.

"Bakkt was first announced in early August as a bitcoin trading and custody platform, but its launch has been repeatedly delayed It has submitted a proposal to the CFTC, asking for an exemption which would allow it to custody the bitcoin it uses to settle its futures contracts. While CFTC Commissioners were reportedly given the proposal in December, it now appears to be back before CFTC staffers. It is unclear if or when the proposal may be published for a mandatory 30-day public review period. Until the review period has ended - and CFTC Commissioners have voted to approve Bakkt's exemption - the exchange cannot launch its one-day physically-settled futures contract."

Barclaycard, which processes nearly half of the UK's credit and debit card transactions, has partnered with Alipay to allow retailers to accept Alipay transactions in stores across the UK.

Donut aims to make crypto investing more accessible for the average consumer and help them educate about investing, crypto and the underlying technologies. The app allows users to invest in baskets of digital assets through a "gamified user interface" and is optimized for recurring micro-investing transactions.

The UK Access to Cash Review Final Report calls for action now to ensure cash remains viable or risk leaving millions behind. The action plan includes a "Guarantee to Cash Access" for all, including those in remote and rural areas, and for those providing essential services to be required to allow consumers to pay by cash.

Deutsche Boerse has outlined plans to build a fully integrated digital asset ecosystem including issuance, custody, access to liquidity, and banking services. The German exchange group has partnered with Swisscom and FinTech company Sygnum to build a regulatory compliant financial market infrastructure for digital assets.

Japan's goal of creating a cashless society has got one step closer with the release of J-Coin Pay - a smartphone-based digital wallet that uses QR codes to provide payment services. Despite the name, however, J-Coin has even less to do with cryptocurrency than the recently announced JPMCoin.

Fidelity may not be offering ethereum custody support at first, due to uncertainty over hard forks. This caution highlights some of the intrinsic risks of crypto assets and goes a long way toward explaining why institutions are taking a cautious approach. Crypto asset custody is riskier and more complicated than most realize

Speaking at SXSW, the SEC's Senior Advisor for Digital Assets Valerie Szczepanik said algorithmic and digital-asset backed stablecoins may be considered securities.

Cash might not be authorised as a means of payment were it introduced in today's environment, some central bankers said on March 13.