Pakistan Regulators Look to Build Friendly Framework for Digital Assets

Pakistan seems to realize the potential of digital assets in the financial future as the country seems geared up for formulating a new framework to regulate cryptocurrencies such as bitcoin. This is highly bullish since Pakistan was among the very few countries that in mid-2018 blanket banned digital assets in any form. It wasn’t until April of 2019 that regulators started to change their minds.

The Securities and Exchange Commission of Pakistan (SECP), on November 6th, released a consultation paper about regulating digital assets. The paper mentioned that the finance ministry is looking to make new laws as they look at the regulatory frameworks set by other countries.

SECP believe digital assets is a “start of a new era of digital finance.” The consultation paper further noted that to propel this new digital finance era, a new set of frameworks would be required to drive its adoption.

“Digital assets also known as Virtual Assets, and Crypto Assets are the start of a new era of Digital Finance, and demand innovative regulatory measures and approaches by the regulators across the world.

This could only be possible by initiation of a new era that re-invents regulatory regime/measures as they are known to the regulators globally today.”

It is also important to note that many developed countries in the West are currently discussing launching a Central Bank-issued Digital Currency (CBDC); however, the consultation paper makes no mention of any such plans by Pakistani financial watchdog. At present, they are only focusing on regulating private digital assets such as bitcoin.

The paper made a note of two types of tokens, namely security tokens and utility tokens, where the regulatory body sees a security token as an important tool that might help in fractionalizing real-world assets and digitize them.

The paper mentions that they have 2 choices as regulators; restrict digital assets due to current rules or take a ‘let-things-happen’ approach. Which they mention that they are heavily leaning towards the do-no-harm approach.

The paper also welcomed feedback from the stakeholders of the decentralized space in developing the new framework.

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Author: James W

WEF Report Says Blockchain Is A Core Component in Sustainable Digital Finance

The World Economic Forum (WEF) recently released a new report about the future of digital finance on Wednesday. The WEF report noted that blockchain and Artificial Intelligence, the Internet of Things (IoT), and mobile platforms represent a core element of digital finance’s sustainable future.

The report noted that blockchain combines coming of age technologies with a sustainable environment-conscious business model. In the report, UBS executive Karin Oertli noted that all these nascent technologies could help organizations and governments to meet their sustainability goals. Oertli wrote,

“We believe that sustainable digital finance will play an essential role in efficiently channeling this capital to fuel innovation, growth, and job creation, at the same time supporting the transition to a sustainable, low-carbon economy.”

Currently, many European countries and top silicon tech firms’ save pledged to reduce their carbon footprint to zero in the next decade owing to the growing concern over climate change and global warming. Thus it has become even more important to bring sustainable business models to rescue the planet earth before it’s too late.

New WEF Report In Line With OECD Research

The latest sustainability report from WEF is not the first report of its kind, which has touted Blockchain as the key to sustainable future business models. It reinstates the research conducted by the Organization for Economic Cooperation and Development (OECD). The OECD report had made similar claims regarding blockchain and said,

“The core properties of blockchain and other DLT can enable deeper technological integration, standardization, and the possibility of new business models.”

Carbon dioxide emissions are growing significantly with each passing year. Some of the western countries have taken it upon themselves to make sure to cut their carbon footprint from now onwards.

The emergence of blockchain as key to a sustainable future comes just in time as crypto space has been battling the criticism over Bitcoin’s network electricity consumption and carbon emission.

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Author: Hank Klinger

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

US Congress Banking Committee Discusses The Development Of Digital Money and Payments Systems

  • The U.S Congress banking committee discusses the future of digital money and payments
  • Former U.S Commodities and Futures Trading Commission (CFTC) chairman is among the witnesses set to present to the committee.

With over 32 bills on digital currencies and payment systems introduced in the 116th U.S Congress, these new technologies got yet another day in the lawmakers’ chambers. According to a remote hearing earlier today, the U.S Senate Committee on Banking, Housing, and Urban Affairs discussed the “Digitization of Money and Payments.”

Details released on the hearing put forward three witnesses who vouched for digital payments, stablecoins and presented the advantages of developing a digital dollar. The witnesses are Former CFTC chairman and Senior Counsel at Willkie Farr & Gallagher LLP, Christopher. J. Giancarlo, Paxos co-founder and CEO, Charles Cascarilla, and Professor of Law at Duke University, Prof. Nakita Q. Cuttino.

In his pre-written statement to the committee, Giancarlo urges that the development of new financial systems to push America into the 21st century. He focuses on the long settlement and bank transfer times, land titles issuance, and recent delays in distribution of the $2 trillion stimulus checks – some taking a month to reflect in citizen’s accounts.

To bring new technological solutions, Giancarlo, who launched the Digital Dollar Project, a non-profit organization aiming to digitize the greenback, will be explaining the need to have a digital USD. He further wrote:

“The United States must take a leadership role in this next wave of digital innovation or be prepared to accept that the innovation will incorporate the values of America’s global competitors.”

Cascarilla looks to focus on stablecoins, and the possible creation of a Fed-controlled digital token, a CBDC. Given the current challenges in the banking system, Charles believes the integration of stablecoins is critical to the U.S’ financial infrastructure and maintaining its position in global economics.

He concluded his statement:

“Supporting growth and innovation with a US CBDC would facilitate the necessary upgrades to our financial infrastructure, reduce systemic risk, increase inclusion for all Americans and reinforce our values and the long-term position of the US dollar.”

According to Nikita’s statement, the development of digitized payment and money systems needs to focus on “the time and access frictions facing low-income Americans.” While digital payments streamline traditional banking, there are challenges still that obscure the countrywide adoption of these new technologies.

“Congress must critically review innovations like CBDCs and stablecoins to ensure novel forms do not belie true functions. In terms of financial inclusion, this means ensuring that promises of open access are achievable and ultimately achieved.”

[Also Read: ‌Bank of Canada: Zero-Knowledge Proof Are Insufficient for National Scale CBDC Integration]

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Author: Lujan Odera

BIS Latest Report Discusses How Payment Are Evolving With Tokenization and CBDC’s

Bank of International Settlements (BIS) researchers focusing on the payments’ future, reveals their latest quarterly report released on Sunday.

The paper has 138 pages and looks at what’s on the horizon in the financial sector, especially since tokenization, central bank digital currencies (CBDCs) and cross-border payments are starting to be more and more in trend.

Conclusions on Tokenization

According to BIS, the tokenization of securities on distributed ledgers can streamline the settlement cycle and become too efficient for some investors to bear with it, seeing traders are used with slow settlement cycles, liquidity management concerns and intermediaries. The report also says DLT and smart contracts are still to be proven when it comes to settlement and clearing, reading further that:

“The ability of tokenized systems to interoperate with account-based systems will be key to their success.”

What About CBDCs?

Another one of the big stories circulating in the world of banking is that of CBDCs, so BIS didn’t hesitate to address it too. It clarifies that there’s no use to develop digital money if it wouldn’t bring any advantages and while the existing payment systems work, saying retailers wouldn’t want to use a system that’s not in demand, whereas most consumers find cash or credit cards much more convenient.

Trying to answer the question of how decentralized a CBDC system would be, the research says decentralization indeed eliminates the risk of the entire system’s failure, but it brings about new vulnerabilities. Here’s what the report reads exactly:

“The key vulnerability of a conventional architecture is the failure of the top node, for example via a targeted hacking attack. The key vulnerability of DLT is the consensus mechanism, which may be put under pressure, for example, by a denial-of-service type of attack.”

Meanwhile, some banks have publicly stated they don’t see DLT as the salvation that’s rumored to be, whereas others are pushing forward with trials on DLT-based CBDCs.

BIS Report on Payments

Agustin Carstens, the General Manager at BIS, said the impact of a completely different and brand-new backend payment infrastructure needs to be considered. Central banks have been put into working mode by Facebook’s Libra, so it’s not yet clear if stablecoins are going to bring the financial doom foreseen by some or not. BIS deemed the matter as unanswered and enduring, saying there’s a need for an international response. It brought its Innovation Hub into discussion, saying it may provide the looked-for global response.

The Innovation Hub will collaborate with monetary policy makers and bankers at developing frameworks on digital innovations. According to BIS, it has spokes in Hong Kong, Switzerland and Singapore, not to mention a good position for developing policies across different networks.

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Author: Oana Ularu

Shark Tank’s Robert Herjavec: Not A Big Believer in Gold; BTC’s Price Will ‘Quintuple’ Long-Term

  • “I’m a big believer in bitcoin, electronic payments in the future,” – Robert Herjavec, founder and CEO of Herjavec Group
  • The minute you have a large institutional company getting behind it then that world will change

According to Shark Tank’s Robert Herjavec, founder and CEO of Herjavec Group, Bitcoin is the future method of payment that will be accepted by most consumers in the coming years, due to its ease of use. Add the price of the world’s leading cryptocurrency will likely skyrocket. Herjavec told Kitco News,

“I’m a big believer in bitcoin, electronic payments in the future but I think we’re a long way away from that.”

While talking about the impact of coronavirus on the stock market that recorded its second-largest drop, Herjavec said that he is “not a big believer in gold,” though he understands the people’s need to go or the yellow metal. Bullion is a traditional safe-haven asset that soared to its 7-year high while the stock market took a brutal beating.

According to him, on a long-term basis base metals aren’t going to be an economic indicator. However, he is a believer in bitcoin, which is considered digital gold. He sees bitcoin’s future as the electronic payments but the digital asset is a long way away from that, he said.

Just like stocks, Bitcoin shed half of the gains it made in 2020, so far. Surging as high as $10,600 this month, bitcoin went back to $8,450 level yesterday. But Herjavec said he will buy the crypto asset at its current prices because, in the long term, the price of bitcoin will quintuple.

Referencing an analyst, he said over the long run consumers always go for convenience and bitcoin is just convenient. As for the crazy bitcoin price forecast, that goes as high as a million-dollar, they “don’t sound crazy” to Herjavec and sees it becoming a reality.

But he does say, one has to “disassociate the price of an individual type of Bitcoin.” Herjavec added,

“Because part of the challenge with Bitcoin is there is no one Bitcoin you can buy different types of Bitcoin and I think it’s a bit of a fragmented industry. The minute you have a JPMorgan Chase or you have a large institutional company getting behind it then that world will change.”

Watch the full video here:

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Author: AnTy

Will Blockstream’s Watchtowers Help Keep The Lightning Network Safe From Attacks?

The Lightning Network (LN) may be controlled and ordered by Watchtowers in the future. Watchtowers are guided by Blockstream’s c-Lightning team and would be a very important improvement on the Lightning Network, the second-layer scaling solution proposed to solve Bitcoin’s scalability issues.

Lightning Network Controlled By Watchtowers

At the moment, the Lightning network works with fraud proofs in order to avoid channels that steal funds. Watchtowers will solve this issue in a new enforcement proposal for the LN called Eltoo. Offline users can protect their funds by deferring to Watchtowers.

This is not the first time that this solution is proposed or tested. Indeed, Lightning Labs and other developers have been working with it. However, this is the first time that such a solution would be implemented on c-Lightning.

In order to protect users, Watchtowers register information from users and store it locally. At the same time, they would be very useful for those nodes that go frequently offline. Nodes that are run by cellphones and similar devices are generally less stable than others.

The c-Lightning developer Christian Decker explained that these Watchtowers are going to play a very important role when users run an unreliable network.

During the last years, the Lightning Network has been growing as a solution for the scalability issues that are affecting Bitcoin and other cryptocurrencies. However, it still needs some time to be developed and tested before it is able to reach the market.

In order for the new Watchtower solution to be approved, it is necessary for the Taproot Bitcoin Improvement Proposal (BIP) to be accepted by the whole Bitcoin community. It is worth pointing out that some months can pass before the market sees this implementation on the Lightning Network.

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Author: Carl T

Digital Asset Security Firm Fireblock Backed By Fidelity Gets EY’s SOC 2 Type II Accreditation

Fidelity Digital Assets (FDAS) thinks that in the future, custodians will work from behind the scenes to store cryptocurrencies for clients from different firms.

At the same time, its enterprise-based platform for crypto transactions, Fireblocks, has just passed an EY audit that confirms it complies with data security standards, which has led to talks with Wall Street clients.

FDAS Doesn’t Have Any Plan to White-Label Its Custody Services

FDAS is a Bitcoin (BTC) custodian and broker for institutional investors. It doesn’t have any plan to white-label its services, this being just a theory about the future it has launched. What it has announced is that this month it’s going to open a new European entity. At the moment, FDAS sources its liquidity mostly from over the counter (OTC) trading desks, but it has plans to have its own crypto exchange until this year is over.

Fireblocks Was Awarded a SOC 2 Type II Certification

After a 6-month audit on how Fidelity’s Fireblocks processes, protects and manages customer data, the company was given a Service Organization Control (SOC) 2 Type II Certification. Fireblocks’s service allows institutions to move digital assets securely. Its platform was launched in June and it supports 180 cryptocurrencies in addition to 22 exchanges. In an EY report, it’s mentioned that Fireblocks met or exceeded the SOC 2 Type II criteria and that it’s going to be evaluated every year in order to comply with all security standards.

Few Crypto Businesses Have the SOC 2 Type 2 Accreditation

According to Fireblocks’ co-founder and CEO, Michael Shaulov, only a few crypto businesses are SOC 2 Type II accredited. Now, the company is looking for clients from outside the crypto world, like financial institutions that want to try the asset class. It has been confirmed that is already in talks with Wall Street firms.

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Author: Oana Ularu

Tim Draper’s Still Bullish On Bitcoin, Calling For $250k By 2022 Based on Infrastructure Not Halving

Tim Draper remains bullish about the future of the cryptocurrency market. In a recent interview, he mentioned that Bitcoin (BTC) could reach a price per coin of $250,000 between 2022 and 2023.

Moreover, he explained why the next price surge will not necessarily be related to the halving Bitcoin will experience in May 2020.

Bitcoin Could Grow As Much As 3200%

Tim Draper, a recognized venture capitalist that invested in major platforms such as Hotmail, Skype, Tesla, and Coinbase, among others, is forecasting Bitcoin to be worth $250,000 in the next 3 to 4 years. That means that the leading cryptocurrency would have to grow as much as 3200% from current prices if it wants to reach that level.

At the same time, Draper predicted in 2014 that Bitcoin price could reach $10,000 by 2017. Although many considered that his prediction was far from being realistic, it was proved to be a conservative one, when Bitcoin surged to $20,000 at the end of 2017, two times more than what Mr. Draper predicted.

According to Draper, he is much more confident in the $250,000 prediction that he made for Bitcoin by 2022 or 2023 than his prediction of Bitcoin being worth $8,500 on December 31st this year.

In order for Bitcoin to reach that price level, it would be necessary for it to become an alternative currency. He said that the currency business is today worth around $86 trillion. In the future, this market is expected to be worth $120 trillion which is going to be opening up huge opportunities for Bitcoin.

“My prediction was really based on creating enough of an infrastructure for Bitcoin to get a 5% market share around the world, as a currency.”

Currently, Bitcoin has a market capitalization of $134 billion and a price per coin of $7,400.

Bitcoin is a cryptocurrency that can be used all over the world without having to rely on a centralized authority, government or institution. This is going to be very valuable in a future that is moving towards decentralization.

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Author: Carl T

Is Africa The Perfect Playground For Bitcoin? Twitter CEO Jack Dorsey Believes It Is

Jack Dorsey, the CEO of two well-known companies – Square and Twitter – reportedly sees a future for Bitcoin, and it is in a country with a developing economy and that boasts 1.2 billion people: Africa.

Dorsey shared on Twitter that he has been in Africa and is sad to leave the continent – for now. More significantly though, he also tweeted that the country will “define the future (especially the bitcoin one!).”

In addition, he tweeted that he will be living there for 3 to 6 months in the middle of 2020 and that he is grateful that he was able to experience a small part.

CNN reported that Dorsey’s trip began on November 8 when he visited Ethiopia. The tour included stops in South Africa, Nigeria, and Ghana.

The report also indicated that Dorsey met artists and entrepreneurs, and Ngozi Okonjo-Iweala, a Twitter board member, economist, and former managing director of the World Bank. During Dorsey’s visit to Ghana, he reportedly met with bitcoin entrepreneurs.

These developments are perhaps part of the process of turning bitcoin into a more functional currency by increasing its accessibility. According to a report by CNBC in September, Dorsey shared with the Australian Finance Review that bitcoin is “not functional as a currency.”

And what needs to be done is to make the currency more usable and accessible. Nonetheless, the report also indicated that Dorsey supports bitcoin and the broader idea of an internet-based currency.

For instance, according to the report, Dorsey shared with the Australian Financial Review that his company Square is hiring five engineers who will solely work on making the crypto ecosystem better, and that he believes that the internet will have a “native currency” and anything that the company can do to make that happen, it’ll do.

Dorsey also tweeted in February 2019 that he only has Bitcoin, and in response to another tweet in that thread, he called Bitcoin “resilient,” “principled,” and “native to internet ideals.”

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Author: Rebecca Asseh