The cryptocurrency market remains slightly bearish as Bitcoin (BTC) struggles to stay above $60,000. While preparing this report, Bitcoin was trading at $62,028, a decline of 3.10% in the past 24 hours. Ethereum (ETH) had lost 2% to trade at $3,027. XRP was trading at $0.4981, up 0.30% in the same period.
Major cryptocurrencies which have gained ground in the past 24 hours are Binance Coin (BNB – $545.74, 1.10%), and Polygon (MATIC – $0.6789, 3.20%),
The only major cryptocurrency, which has lost ground in the past 24 hours, is Cardano (ADA, $0.4513, -1.50%), Solana (SOL, $135.82, -0.90%), Avalanche (Avax- $34.55, -0.60%), Shiba Inu (SHIB, $34.55, -1.90%), EOS (EOS – $0.7432, -0.80%), ChainLink (LINK – $13.29, -0.80%), VeChain (VET, $0.0386, 03.20%) and Polkadot (DOT, $6.70, -0.10%).
Government Level Initiatives
Bank for International Settlements Launches Project Agorá
The Bank for International Settlements (BIS) Innovation Hub has unveiled Project Agorá, a big initiative intended to tokenize cross-border payments. Representing the first endeavor under the Unified Ledger framework, it aims to establish a collaborative platform involving seven central banks and commercial institutions. This initiative attempts to streamline cross-border transactions through a shared, programmable framework.
Encompassing key currencies such as the USD, Euro, GBP, and Yen, the project is backed by prominent central banks, including the Bank of France (representing the Eurosystem), Bank of Japan, Bank of Korea, Bank of Mexico, Swiss National Bank, Bank of England, and the Federal Reserve Bank of New York.
Project Agorá is conceived as a public-private partnership. The Institute of International Finance (IIF) will oversee the coordination of this partnership initiative.
ECB Announces Participants for Wholesale DLT Trials with Central Bank Funds
The European Central Bank has unveiled the inaugural list of participants engaged in wholesale Distributed Ledger Technology (DLT) trials leveraging central bank funds for settlement purposes. The participants encompass ten entities, comprising six market DLT operators and five central banks. Applications for participating in the second phase are currently being solicited.
In December 2023, the ECB made its initial call to participate in the trial. The piloting will cover real transactions and also mock simulations, with the majority of the trials centered on securities settlement.
The EuroSystem also intends to ponder usage scenarios for payment versus payment (FX) and cross-border payment. Three strategies for settlement are studied in the trials. The solutions were provided by the central banks of Germany (Trigger solution), France (wholesale CBDC), and Italy (TIPS Hashlink).
The Österreichische National Bank is also taking part as a DLT operator, and the Bank of Luxembourg is also a participant.
Out of the 10 market participants, seven are German firms, including the subsidiary of JP Morgan, B Metzler, DekaBank, Deutsche Bank, DZ Bank, Deutsche Börse’s Eurex Clearing, and Landesbank Baden-Württemberg. Among the non-German institutions, one is from France (BNP Paribas), while two are from Luxembourg (European Investment Bank and Spuerkeess).
Private Sector Initiatives
DWS Launches Cryptocurrency ETPs with Custodial Support from Zodia and Coinbase
Deutsche Bank asset manager DWS (AUM EUR 896 billion) has unveiled its initial cryptocurrency-based exchange-traded products (ETP), named Xtracker, based on physical Bitcoin (BTC) and Ethereum (ETH). This follows last year’s collaboration with Galaxy Digital. Notably, Zodia Custody, which is backed by Standard Chartered’s SC Ventures, Japan’s SBI, and Northern Trust, acts as one of the custodians of the underlying cryptos.
In the case of DWS Xtracker offerings, Coinbase, along with Zodia, provides the custodial service. Furthermore, State Street will function as an issuing, paying, and administration agent.
Interestingly, a week earlier, Zodia Custody inked a deal with ETC Group, the specialist European ETP issuer managing $1.64 billion worth of assets.
Sony Bank Trials Stablecoin for Digital Sales, Partners with Settlemint and Fujitsu
Sony Bank has begun trialing the issue of a stablecoin pegged to currencies, including the yen. Specifically, the enterprise plans to study whether stablecoins can be used as a settlement mechanism for Sony Group’s digital sales, including games.
Belgium-based tech firm Settlemint is creating a stablecoin with the Polygon blockchain as its core. Settlemint, through a partnership with Fujitsu, was able to gain access to the Japanese market.
As per Japan’s law, stablecoins are categorized into three types. Japanese banks are permitted to issue only stablecoins pegged to deposits.
The bank is also associated with Sumitomo Mitsui Trust Bank (SuMi Trust) for digital securities. Therefore, there is a likelihood of releasing a trust-backed token.
Sony Group and Sony Bank have considerable Web3 activities. In 2023, Sony Group acquired a stake in Startale Labs, which is related to the establishment of the Astar Network. The group is developing its own blockchain to capitalize on the intellectual property in the metaverse.
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