Shanghai Using Permissionless Blockchain to Pilot the Use of RMB for Cross-border Payments

Shanghai Using Permissionless Blockchain to Pilot the Use of RMB for Cross-border Payments

Conflux’s permissionless blockchain will be used to test the digital RMB for cross-border payments in Shanghai’s Lingang Pilot Free Trade Zone.

In July, China’s central bank has approved the Lingang Pilot Free Trade Zone to test the free capital inflows and outflows.

In January, the Shanghai government invested $5 million in the network.

“Conflux public blockchain will pilot the use of the RMB offshore stablecoin for cross-border payments as part of Shanghai Free Trade Zone initiative- the renminbi is China’s official currency, while the Yuan is the unit of the currency,” noted Conflux Network.

In response to the news, the token of the network CFX pumped 170% to $0.736 over the weekend. But since then, CFX is down about 39% to trade at $0.451 on Monday. The coin is also down 72.4% from its all-time high of $1.70 from six months back.

The state-owned Shanghai Maritime University will conduct the experiment, and Conflux established the Shanghai ShuTu Blockchain Research Institute. The research center will also explore developing blockchain standards for trade and shipping.

The People’s Bank of China has been conducting trials for its central bank digital currency (CBDC) since April of last year but has recently started testing it in cross-border applications.

The PBOC actually aims to launch the CBDC by the 2022 Winter Olympics. Earlier this month, speaking at the China Digital Finance Forum, deputy governor Fan Yifei said e-CNY test runs have shown “great potential” though there were some issues that “need to be solved.”

By mid-July, 21 million individuals were using the digital yuan, and the trial had reached 34.5 billion yuan ($5.3 billion) in transactions.

Two months later, about 140 million people have used China’s digital yuan app thanks to the collaboration between the central bank and Chinese shopping platform Meituan. As a result, almost all the residents in nine major Chinese cities can download the app and start using it.

New features in the form of programmability through smart contracts and sub-wallets to facilitate online digital currency payments to participating merchants have also been added to the app recently.

Besides working with tech giants for the digital yuan, China is also developing gadgets like bracelets, wristbands, and smartwatches to support digital yuan wallets.

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Author: AnTy

SWIFT Takes Swipe At Ripple With A Cheaper Cross-border Payment System

SWIFT Takes Swipe At Ripple With A Cheaper Cross-border Payment System

Global messaging network SWIFT has introduced a new service aimed at offering low-value, cross-border payments.

SWIFT GO Launches Live With Seven Major Banks

The new service dubbed SWIFT Go has been launched and is already being used by seven major global banks. The banks include BBVA, BNY Mellon, DNB, MYBank, Sberbank, Societe Generale, and UniCredit.

SWIFT GO is designed to enable businesses and consumers to send payments quickly and securely anywhere in the world directly from their bank accounts, per the press release.

The service pre-validates data and uses tighter service level agreements between institutions to enable banks to provide customers with a fast and predictable payments experience. SWIFT GO runs on SWIFT GPI (global payment innovation), which deals with high-value payments.

Speaking on the new unveiling Stephen Gilderdale, Chief Product Officer, at SWIFT said:

“SWIFT Go is a further step towards achieving our vision of enabling anybody, anywhere, to send money instantly and securely around the world. The new service is a direct response to the needs of small businesses and consumers for fast, easy, predictable, secure, and competitively priced cross-border payments.”

Besides SWIFT GO, the financial network also plans to roll out a new platform for international payments in November next year.

The new platform, according to SWIFT, would include features such as an extension of SWIFT’s high-speed system to lower-value payments and incorporation of the universal messaging standard for international payments.

Founded in 1977, SWIFT is a global messaging network connecting banks and other financial institutions for cross-border payments. It links more than 11,000 institutions. The company transmitted more than 350 million messages containing financial information last month alone.

SWIFT Enters Ripple Cross-Border Payment Territory

SWIFT’s new move of entering the cross-border payment scene with the SWIFT Go product may be seen as an attempt to compete with Ripple. The Blockchain company is one of the firms that have taken the lead in addressing issues in cross-border payments.

SWIFT’s new product has stepped up the company’s payment system by providing faster settlement times and an ability to track payments. In 2019, 50% of GPI payments were credited to beneficiaries within 30 minutes and almost 100% within 24 hours.

Although it seemed like a great accomplishment at the time, Ripple CEO Bradley Garlinghouse said in a conference that the SWIFT system of transferring money was well out of date. According to him, at least six percent of SWIFT transactions cannot happen without being supervised by human operators.

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Author: Jimmy Aki

Stellar Dev Foundation Invests $15M in AirTM to Improve Latin American Cross-Border Transfers

Stellar Dev Foundation Invests $15M in AirTM to Improve Latin American Cross-Border Transfers

  • The Stellar Development Foundation (SDF) is deepening its roots in Latin America with a $15 million funding round to Mexico City’s AirTM, a digital wallet, and peer-to-peer crypto exchange.

In an announcement on Tuesday, SDF’s venture arm, Stellar Enterprise Fund, announced the multi-million funding round aims to boost the development of AirTM’s platform. Additionally, SDF will integrate Stellar blockchain to the platform in the coming year to make the transactions cheaper, a statement from the team reads.

Since the launch of the Enterprise Fund, this constitutes the largest ever investment from SDF. Previous investments by SDF include a $3 million funding round in Settle Network, an Argentine payments channel, and U.S.-based credits firm Tribal Credit, which also received $3 million at the end of April. These investments target the growth of digital payments and cross-border transfers across Latin American countries.

In a similar fashion, the $15 million investment will allow AirTM to enhance its financial services in Latin America while widening its market base. With the integration of Stellar, payments and cross-border transfers are expected to become cheaper and faster, which improves the financial access to Latin American people who have suffered under “fragmented financial systems” for long, SDF Executive Director Denelle Dixon said in the statement.

Adding to Dixon’s statement, AirTM CEO Ruben Galindo Steckel stated the investment would also allow businesses to flourish in Latin America – making them more compatible and open to the global economy. The investment further boosts the goal of the SDF to help “consumers and businesses throughout the developing world access stable money that holds its value” which “is instant to transfer with no fees, and can be withdrawn as local currency whenever, and wherever it’s needed” he continued.

Over the past six months, SDF also invested $5 million in blockchain payment firm, Wyre, to help introduce various payment application programming interfaces, commonly known as APIs, which can integrate with different apps within the Stellar ecosystem. In December, SDF invested $3 million (paid in Stellar Lumens, or XLM) to Settle to focus on fiat-to-crypto on-ramps and boost transactions across the LATAM region.

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Author: Lujan Odera

China & UAE Central Banks Join HKMA & BoT In ‘Multiple CBDC Bridge’ For Cross-Border Payments

China & UAE Central Banks Join HKMA & BoT In ‘Multiple CBDC Bridge’ For Cross-Border Payments

To reduce cross-border payment’s pain, the Central Bank of United Arab Emirates (CBUAE) and People’s Bank of China (PBoC) have joined multiple-CBDC’s projects, announced Hong-Kong Monetary Authority (HKMA) and Bank of Thailand (BoT) on 23rd February.

The project, Central Bank of Digital Currency (CBDC), has pulled many central banks to blockchain across Asia, making regulation easier against regular currencies (fiats). Now, HKMA and BOT are on the road together with the People’s Bank of China and Central Banks of UAE to explore Blockchain Ledger Technology’s possible facilities.

In light of the announcement, the current phase of the exploration into Central Bank of Digital Currency, based on the ‘Inthanon-LionRock’ research project, is going to create a PoC (proof of concept) to,

“Facilitate real-time cross-border foreign exchange payment-versus-payment transactions in a multi-jurisdictional context and on a 24/7 basis.”

The CBDC focuses explicitly on resolving the difficulties a user faces during cross-border payments. Complex regulations and cost inefficiencies are the primary barriers to transfer funds across countries. As Mathee Supapongse, BoT’s deputy governor noted earlier,

“The model offers a cross-border corridor network where participants can transfer funds instantaneously on a peer-to-peer basis and in an atomic PvP manner. The design and key findings of the project have added new dimensions to central bank communities’ studies on cross-border funds transfer area.”

The inclusion of Asia’s significant countries’ central banks in the CBDC project would lead other financial sectors to join the track. And if it comes true, the adoptions will create a transparent and inducive environment for CBDC to integrate finance beyond Asia, too.

The growing profile of blockchain has compelled the vast number of government authorities to have a digital alternative to decentralized coins like Bitcoin and its linked currencies.

Due to the highly technical nature of the digital market, government sectors would find it hard to track and control the flow of digital assets. And this will eventually make CBDC the commonplace to come in the future. China is second to none in creating CBDC’s mechanism and trying hardware biometric ID wallets for its digital yuan.

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Author: James W

BIS to Build Proof of Concept Network for Testing Cross-Border Payments Using CBDC’s

BIS to Build Proof of Concept Network for Testing Cross-Border Payments Using CBDC’s

The Bank of International Settlements’ Innovation Hub (BISIH) announced this week that one of its highest priorities is the continued research and testing of Central Bank Digital Currencies (CBDCs), along with five other areas of focus.

This news is according to this year’s annual work program, which lays out its intention to “explore the feasibility of faster and cheaper cross-border payments” using central bank digital currencies. The BISIH further added that it would dedicate its work this year to exploring prototypes in the creation of “tiered retail CBDC distribution architectures” along with “tokenized green bonds to retail investors.”

To drive these priorities forward, they will be headed up by the company’s Innovation Hub Centres in Hong Kong, Singapore, and Switzerland while also coordinating with local central banks. The BISIH’s Innovation Center in Singapore, for example, has its sights set on the development of an ‘International Settlement Platform’ where regulated banks and payment entities can conduct and settle transactions using a range of CBDCs.

Meanwhile, Hong Kong’s Innovation Center will be working on green bonds, specifically with the intent of tokenizing green bond assets for retail investors. Additionally, Hong Kong’s center will work on building a bridge to enable foreign exchange transactions of approved CBDCs, along with stablecoin issuance.

Switzerland’s BISIH Center is one of the furthest ahead in terms of development. It has already completed two functional proofs-of-concept for linking payment systems to test out payment settlements using tokenized assets and wholesale CBDC. This was done through its initiative dubbed ‘Project Helvtica.’ Discussing the details of BISIH’s work program, Innovation Hub’s Head, Benoit Coeure, said the following:

“This work programme shows our commitment to exploring in the most practical ways how best to harness technological change for the benefit of central banks and create public goods to support the global financial system.”

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Author: James Fox

Federal Reserve Chairman Jerome Powell to Speak About Digital Currencies Today

As part of a panel on “Cross-Border Payments—A Vision for the Future,” at the International Monetary Fund’s (IMF) annual meeting, Federal Reserve Chairman Jerome Powell will speak about digital currencies Monday.

The panel will start at 8 a.m. ET on Oct. 19.

During this virtual event, while discussing the potential solutions to enhance the cross-border payments, the “benefits and risks” of digital currencies and their macro-financial implications will also be covered.

“On Monday, Jay Powell gives his input on central bank digital currencies at the IMF talk listed above. Central Bank digital currencies are coming, and they will change everything… They are coming under stealth of X-border payments but it means so much more…” said former hedge fund manager Raoul Pal, CEO of Real Vision Group.

It is, however, not mentioned if Powell would be sharing his thoughts on a digital dollar.

Other panelists include Agustín Carstens, general manager of the Bank for International Settlements (BIS); Ahmed Abdulkarim Alkholifey Governor of the Saudi Arabian Monetary Authority; and Nor Shamsiah, governor of Bank Negara Malaysia with IMF Managing Director Kristalina Georgieva as the moderator.

You can watch live here:

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Author: AnTy

ConsenSys to Lead Phase Two of Hong Kong and Thailand’s Cross-Border CBDC Project

ConsenSys has been awarded the contract to lead phase two of the cross-border payments ‘CBDC’ project between Hong Kong and Thailand. Dubbed project ‘Inthanon-LionRock,’ the initiative follows successful research by the central banks of both jurisdictions, which found an additional value case in building a cross-border CBDC.

According to the press release by ConsenSys, they will work alongside industry giants Forms HK and PriceWaterhouseCoopers (PWC) towards implementing the second phase. Notably, the project has been in the works since May 2019 when the Bank of Thailand (BoT) and Hong Kong Monetary Authority (HKMA) signed a memorandum of understanding to dig deeper into the value proposition CBDC’s.

With ConsenSys now in the picture, the joint CBDC between Thailand and Hong Kong will move past the research phase to a more practical era. ConsenSys has since been tasked with building a proof-of-concept (PoC) cross-border corridor to enable Hong Kong’s Lionrock and Thailand’s Inthanon networks to interact seamlessly. The press release reads,

“Using its enterprise Ethereum stack, ConsenSys will test solutions that prioritize scalability, security, and interoperability.”

This is not the first time ConsenSys works collaboratively with a particular authority towards designing and developing a CBDC. The blockchain software technology firm has, in the past, worked with the South African Reserve Bank and Monetary Authority of Singapore to create decentralized payment networks. ConsenSys Hong Kong Director, Charles d’Haussy, noted that they are thrilled to take on a new initiative in a similar line,

“ConsenSys is thrilled to lead this implementation of CBDC for cross-border payments. We are humbled to work on the development of Hong Kong’s financial infrastructure.”

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Author: Edwin Munyui

Ant Group Launches Blockchain-Powered Cross-border Trade Settlement Platform ‘Trusple’

Ant Group, owner of mobile payment app Alipay, launched a blockchain-powered platform for cross-border trade settlements this week. The move came ahead of its IPO, which it plans to list in Hong Kong and on Shanghai’s STAR Market next month simultaneously.

The 16-year old giant, which is backed by e-commerce conglomerate Alibaba Group, is seeking to raise about $35 billion in the dual IPO to become the world’s largest IPO by surpassing oil giant Saudi Aramco’s billion last December.

Previously known as Ant Financial, Ant was rebranded this year as a tech firm due to tighter financial regulations.

Ant is known for submitting the most number of blockchain patent applications globally, over the past two years. The technology saw a surge in interest after President Xi Jinping said last year that the country should accelerate its development.

Its new platform, “Trusple,” is based on Antchain, the company’s blockchain technology.

On this platform, buyers and sellers upload their orders, which automatically generate smart contracts with information like logistics. The banks then process payments using Antchain.

The users of the platform could also include vendors that sell to other businesses through marketplaces like Alibaba’s overseas e-commerce site, AliExpress.

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Author: AnTy

Ripple Gains Praise From US Consumer Financial Protection Bureau For Remittance Service

Ripple and XRP’s remittance potential in cross-border transfers has been recognized by the US Consumer Financial Protection Bureau (CFPB).

According to a CFPB paper from May 11, the bureau responsible for providing the financial sector’s US consumers has been researching the remittance market’s new trends. Furthermore, it has been focusing on the continued expansion and growth of partnerships developed by digital asset companies such as Ripple.

XRP for Settling Cross-Border Transfers

In the same paper, the CFPB mentioned that XRP could be used for cross-border transfers. Also, Ripple’s products can give credit unions and banks exact information on how much remittance transfers’ recipients are going to receive before they’re even being sent anything.

The platform for global payments innovation (GPI) from SWIFT was mentioned in the paper too. This platform’s purpose is to speed up remittance by using the infrastructure banks from all over the world prefer to use.

SWIFT said it was considering using blockchain rails for its GPI solution ever since 2019, yet no update on this matter has been provided yet.

Ripple Pushes for XRP Adoption

In spite of showing support for Ripple, the CFPB doesn’t seem too enthusiastic about crypto company’s push for widespread adoption of the XRP. It concluded that any new solutions would most likely not eliminate the reliance on their correspondent banking network, as this what the market players’ feedback and the agency’s estimations have revealed.

Despite this, Ripple doesn’t give up, aiming at the financial mainstream. Only last month, it had Japan-based financial giant SBI Holdings, which it’s its investor and partner, announcing that Ripple-powered settlements are going to be integrated with ATMs all over Japan. According to market researcher Fundstrat, XRP was the weakest performing crypto asset since the beginning of 2020 until May.

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Author: Oana Ularu

Firms Have Borrowed $8.2 Billion from the Blockchain Platform of a Chinese Forex Regulator

The Chinese regulator State Administration of Foreign Exchange (SAFE) runs a cross-border blockchain financing system and has helped firms with more than $8.2 billion.

The SAFE platform has helped small and medium-sized (SMEs) corporations and enterprises with this amount of money in only 8 months after being opened, reports the Economic Information Daily. Ever since it has been launched in March 2019, it has expanded its pilot financing program from 7 provinces to 17, having more than 160 banks joining its program.

One-Third of Chinese Lenders Providing Forex Services

Since November 29th, almost 1,600 companies, most of them SMEs, have become part of the SAFE program and started sharing their financial bookkeeps with over 160 banks. One-third of the lenders in China are providing Forex service. SAFE’s deputy director Zhang Xin said the platform will be advanced to make foreign exchange receipts and cross-border trade settlements easier. This is what the blockchain analyst Cao Yin declared about the initiative:

“The traditional financial processes, which require a lot of human labor to carry out information verification and authorization, leave a lot of room for financial fraud, but as the blockchain system promises a decentralized and encrypted track of each capital flow, it leaves potentially little to no space for human mediation.”

Aside from having a reliable trust mechanism, the SAFE platform offers real-time supervision and reduced processing time for any transaction. Zhang said transactions are now taking in place in 15 minutes, as opposed to the 1 or 2 days like they did before.

SAFE Platform to Be One of the Most Influential Chinese Blockchain Projects

The cross-border blockchain platform run by SAFE is at the moment the only state organ to file a Cyberspace Administration of China blockchain record. It’s set to become one of the most influential blockchain projects in the country, together with the central bank’s Greater Bay Area blockchain trade and finance platform.

After President Xi Jinping has endorsed the blockchain, more government authorities and enterprises in China have started hurrying to implement the new technology. Earlier in November, China has launched a blockchain identification system for cities.

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Author: Oana Ularu