Regulatory News
European Union (EU)
EBA seeks input on conflicts of interest rules for crypto asset issuers - On December 7, 2023, the European Banking Authority (EBA) has released a Consultation Paper seeking feedback on draft regulatory technical standards (RTS) outlining the requirements for policies and procedures on conflicts of interest for issuers of asset-referenced tokens (ARTs) under Market in Crypto-Assets Regulation (MiCAR). Key aspects include considerations related to asset reserves, personal transitions and issuer remuneration. This draft underlines the role of management bodies in defining and adopting conflict of interest policies with specific requirements for ART issuers. The consultation period runs until March 7, 2024, with a virtual public hearing scheduled for January 11, 2024.
Bank of Italy and Bank of Korea sign MOU for collaboration on IT and Payment Systems - The Bank of Italy and the Bank of Korea have formalized a Memorandum of Understanding (MOU) to enhance collaboration in the areas of IT and payment systems. The agreement focuses on the exchange of knowledge and information related to ICT technologies, particularly in support of real-time settlement systems (RTGS) and the development of Central Bank Digital Currency (CBDC). The MOU reflects a commitment to mutual cooperation in advancing technological advancements within the banking sector.
United Kingdom (UK)
UK Treasury Committee urges caution and lower limits for digital pound - The UK Parliament's Treasury Committee has recommended caution to the Bank of England and HM Treasury in developing a retail central bank digital currency (CBDC). The committee's paper, published on December 2, 2023, proposes lower holding limits than the £10,000-£20,000 currently suggested for a digital pound. Emphasizing the importance of not worsening financial exclusion, the committee addresses risks related to privacy, financial stability and monetary policy. Concerns include potential lending cost increases, the absence of interest on the digital pound, and the need for legislation to safeguard private payment data usage. The committee seeks a cost-benefit analysis before issuing a digital pound and inquires about research costs and launch decision criteria.
British Regulator warns against Poloniex following $100M Hack, cites lack of authorization - The Financial Conduct Authority (FCA) has added the crypto exchange Poloniex to its warning list, stating that the platform is operating without proper authorization. Poloniex, linked to entrepreneur Justin Sun, recently suffered a $100 million hack. The FCA emphasizes that dealing with unauthorized entities lacks financial law protection. The FCA had previously included 140 crypto companies, including Poloniex, on its warning list.
MENA
UAE Implements Comprehensive E-commerce Law for Digital Commerce Regulation - The United Arab Emirates (UAE) has enacted a new e-commerce law, effective since September 2023, to regulate digital commerce activities comprehensively. Covering a broad range of modern technology-based trading, the law emphasizes consumer rights, cybersecurity, fair advertising, and dispute resolution mechanisms. Applicable to various platforms, including websites and blockchain-based systems, the law is positioned to facilitate the UAE's digital commerce sector growth. Dubai-based technology law expert Martin Hayward of Pinsent Masons highlights that the law underscores the rapid growth of digital commerce in the UAE and the need for clear and effective regulation. It intersects with other UAE laws on consumer protection, intellectual property, payments, data protection, cybersecurity, and electronic transactions.
Industry News
European Union (EU)
Société Générale Launches Stablecoin - Société Générale is set to debut its stablecoin, EUR CoinVertible, on Bitstamp, becoming the first major bank to enter the stablecoin market. The euro-denominated stablecoin aims to provide a viable alternative in a market dominated by US dollar-backed stablecoins. Société Générale sees potential in using the stablecoin for settling trades in digital assets and complies with upcoming EU regulations. The move marks a significant step for traditional banks into the cryptocurrency space.
Robinhood launches crypto trading in EU - Robinhood has extended its crypto trading services to eligible customers in the EU, introducing a unique feature where users receive a percentage of their trading volume back each month in Bitcoin. The platform, which supports trading for over 25 cryptocurrencies, emphasizes safety, security, and transparency. Customers in the EU can earn up to 1 BTC as a reward for signing up and referring friends. The move aligns with Robinhood's mission to democratize finance and expand crypto accessibility globally. The platform plans to introduce additional features like crypto transfers and staking in 2024.
Study reveals up to 85% cost savings with DLT-based capital market infrastructure - A collaborative study by FinPlanet, Cashlink, and Porsche Consulting explores the potential cost savings achievable through distributed ledger technology (DLT) in capital markets. The analysis, comparing costs associated with conventional bearer bonds and DLT-defined crypto securities, indicates that DLT implementation can lead to substantial savings. Using a "bottom-up" approach involving interviews with experts and market participants, the study forecasts up to 85% cost reduction in middle and back-office processes by 2028. Even today, potential savings of up to 22% are identified, particularly in Corporate Actions & Asset Servicing and Clearing & Settlement processes.
LATAM
Brazil's Itaú, largest private bank, launches cryptocurrency trading - Itaú, Brazil's largest private bank, has introduced cryptocurrency trading services for selected customers via its ion investment platform. The initial offering includes Bitcoin and Ether, with plans to expand the range in the future. The move comes a year after Itaú initiated digital asset custody services. Regulatory clarity is a key factor influencing the gradual rollout, and while early investors can buy and sell, the bank will retain custody control, restricting transfers in and out of the wallet.
MENA
UAE Researchers launch blockchain for Carbon Trading Amid COP28 - Abu Dhabi's Technology Innovation Institute unveiled a blockchain-based carbon trading platform during COP28. Developed by the Cryptography Research Center, the lightweight blockchain enables international trade in carbon tokens, monitors greenhouse projects, and encourages emission reduction initiatives. The initiative aligns with the government's climate action goals, leveraging blockchain for transparent and secure tracking of emissions.
Global News
New Binance CEO acknowledges compliance mistakes - Richard Teng, the newly appointed CEO of Binance, admitted past compliance shortcomings during his first public interview at the Financial Times’ Crypto and Digital Assets Summit. While acknowledging mistakes, Teng evaded direct answers on Binance's governance, headquarters, audit plans, employee count, and UK licensing. The interview followed Binance's settlement with the U.S. Department of Justice. Teng emphasized a user- and compliance-led approach for the future but remained vague on specifics, frustrating the interviewer with elusive responses.
Coinbase wallet streamlines cryptopPayments: Users can send via social media - Coinbase has introduced a feature allowing users to send and receive cryptocurrencies through shared links on various messaging and social media platforms. The service, available for Coinbase Wallet users, enables instant and fee-free transactions, ideal for micro-payments. Both senders and recipients must use Coinbase Wallet, with unclaimed funds returned after two weeks. Coinbase aims to expand global access, particularly benefiting individuals in high-inflation economies. The move follows Coinbase's strong market performance despite ongoing legal challenges, including a court battle with the US securities regulator.
Zodia Custody enhances market connectivity through integration with Fireblocks - Zodia Custody, aiming to bolster market infrastructure for institutional entry into the digital asset ecosystem, has integrated with Fireblocks. This collaboration enables institutional investors to securely transfer digital assets across accounts, leveraging Fireblocks' automated address authentication. The connection also links financial institutions to Zodia Custody's Interchange, offering enhanced security, risk management, and solvency protection for digital asset trading. By simplifying the technical and operational complexities associated with multiple accounts, this integration provides a seamless solution for managing digital asset holdings.
JP Morgan is live on multi bank tokenized deposit platform Partior - JP Morgan is now operational on Singapore's Partior blockchain network, making it the sole U.S. bank on the platform. Partior, co-founded by JP Morgan, facilitates multi-currency transactions and enhances correspondent banking services. While JPM Coin focuses on digital cash movements within JP Morgan, Partior extends these capabilities to interbank transactions, aiming to improve the efficiency of cross-border payments and expand into FX settlement. The network retains elements of the correspondent banking system but offers advancements in transaction speed and automation.
