The cryptocurrency market remains slightly bearish as Bitcoin (BTC) failed to sustain above $45,000. While writing this article, Bitcoin was trading at $42,716, down 7.60% in the past 24 hours. Ether (ETH) has lost 7.20% to trade at $3,012. XRP was trading at $0.9384, a decrease of 6.60% in the last 24 hours.
Major altcoins, which have lost ground in the past 24 hours, are Dash (DASH-$171.60, -7.10%), EOS (EOS-$4.20, -10.40%), Tron (TRX-$0.9250, -6.10%), Bitcoin SV (BSV-$136.80, -9.80%), Stellar (XLM-$0.2846, -6.2%), ChainLink (LINK-$23.58, -10.40%), Bitcoin Cash (BCH, $540.82, -7.80%), IOTA (IOTA-$1.30, -10.60%), VeChain (VET, $0.0946, -8%), Uniswap (UNI, $21.21, -8.1%), Internet Computer (ICP, $48.12, -11.80%), Cardano (ADA-$2.13, -3%), Dogecoin (DOGE, $0.2105, -6.80%), Polygon (Matic, $1.15, -9.70%), Solana (SOL, $139.06, -5.30%), Cosmos (ATOM, $35.55, -12.40%), Polkadot (DOT, $29.30, -9.70%) and Tezos (XTZ-5.24, -13%).
Government level initiatives
ICBC launches digital yuan Smart Exchange service
The Industrial and Commercial Bank of China (ICBC) has rolled out digital yuan Smart Exchange service, which facilitates auto-transfer of funds between a customer’s bank account and the wallet holding digital yuan (China’s Central Bank Digital Currency) and vice versa. Bank customers, in general, used to opt for the facility of automatically transferring surplus funds in their current account to a savings account without a need for tracking the account. A similar setup is offered by ICBC’s Smart Exchange Service for the digital yuan.
As digital wallets holding CBDCs are not designed to be interest-bearing deposits, it becomes less attractive, in comparison with usual savings accounts, to users. Therefore, users may hold only a small amount of cash in the digital wallet for minor retail dealings. This will hamper the adoption of CBDC. The app provided by the bank facilitates the automated conversion of bank account balances into digital yuan, converts digital yuan beyond a particular threshold into a bank deposit, and also ensures that the wallet holds a pre-determined amount of digital yuan. The facility will make the use of digital yuan more attractive to users.
Private sector initiatives
MonetaGo rolls out global PoC with SWIFT
Tech firm MonetaGo has initiated a global PoC (proof of concept) with SWIFT for its blockchain platform structured to negate trade finance fraud. Three years ago, the tech firm launched a similar platform in India with SWIFT as a partner. The platform utilizes Aps and prevents various forms of financial fraud, including double financing of invoices, bills of lading, purchase orders, and warehouse receipts.
In the first six months of 2021, MonetaGo conducted a PoC in Singapore with 24 institutions, including ITFA, HSBC, International Chamber of Commerce (ICC), Citi, Stanchart, SMBC, Bolero, and blockchain technology-based platforms Contour and Tradeix (Marco Polo). MonetaGo has pointed out that linking several local anti-fraud platforms is a highly cumbersome process, and the use of a globally recognized platform is the solution. In case the SWIFT PoC turns out to be successful, the platform could pave the way for connecting over 11,000 members of SWIFT.
Commenting on the benefits of the platform, Louise Taylor-Digby, Global Head of Trade Strategy, SWIFT, said: “Finance fraud in cross-border trade cannot be fully mitigated with local registries, so it makes perfect sense to leverage SWIFT’s global reach to help institutions around the world to solve this problem.”
New York Community Bank makes use of payment system called USDForward
The New York Community Bank has utilized what is referred to as ‘digital markers’ for blockchain technology-based payments. The bank calls the payment mechanism USDForward and the process uses tokenized bank account balances, comparable to settlement tokens of Russia’s Sber bank and JP Morgan’s JPM coin. Notably, the NY Community Bank is among the JAM FINTOP Bank Network, including 66 community bank members.
The bank stressed that the transaction has nothing to do with stablecoin as the USDForward epitomizes money in the bank of the token holder on a 1:1 ratio, with all the platform users complying with the KYC (know your customer) laws.
Notably, the term ‘Forward’ underlines the processing of moving the USD on-chain and is not related to any kind of derivative contract. Interestingly, in August, the bank revealed that it has acquired a stake and also partnered with Figure Technologies, which runs the Provenance Blockchain. Also, a subsidiary of Figure was issued an Alternative Trading System (ATS) license. Furthermore, a USDForward was utilized to settle for secondary market trades associated with Figure’s native stock on the Figure ATS.
Mike Cagney, CEO of Figure, said, “New York Community Bank’s digital marker and Figure ATS together demonstrate the remarkable possibilities for private company stock trading and settlement in real-time without counterparty or settlement risk, and is a harbinger of the significant disruption blockchain is bringing to global exchanges, including public equity markets.”
Miscellaneous
FINMA issues two licenses to SIX
The Swiss regulator FINMA has issued two licenses to the Swiss stock exchange SIX, paving the way for the roll-out of SIX Digital Exchange (SDX). The exchange will act as an integrated platform for trading, settlement, and custody of cryptocurrencies. SIX stressed that it aims to join hands with other like-minded firms to establish a worldwide network to ‘unlock global liquidity.’ In 2020, the firm revealed a partnership with SBI for the roll-out of a cryptocurrency exchange in Singapore. SBI also intends to set up a cryptocurrency exchange in Japan.
SDX Trading AG already owns a license to run a stock exchange, and SIX Digital Exchange AG will be regulated as a central securities depository (CSD).
All partakers in SDX are traditional financial institutions. Last month saw the enforcement of fresh Swiss legislation that facilitates the easy licensing process for distributed ledger (DLT) based trading encompassing both individuals and institutions. However, SDX was not licensed in that manner.
SIX began working on the venture three years ago and rolled out a prototype utilizing R3’s enterprise blockchain Corda in 2019.
Disclaimer: Any financial trading analysis offered here is our opinion and is not intended as advice or direction for investors. We cannot guarantee the success of any trades made as a consequence of this article, and we encourage traders to incorporate a strong money management strategy to limit losses when they enter the markets. Please use this article as part of your own research before formulating strategies prior to trading.
