Značka: CBDC

EIB settles €100 million digital bond on private blockchain

According to a new press release on Nov. 29, the European Investment Bank, or EIB, issued a first-ever euro-denominated €100 million digital bond on a private blockchain-underpinned platform with tokenization help from Goldman Sachs.The latter, along with Société Générale Luxembourg, also act as the on-chain custodians for the financial instrument. The bond bears interest at a coupon rate of 2.57% per year with a maturity date of Nov. 29, 2024, and is governed by Luxembourger laws. Banque de France and the Banque Centrale du Luxembourg participated in the project to provide a digital representation of euro central bank money. The EIB says that “the transaction paves the way for future on-chain derivative solutions, by using the first interest rate swap hedge represented through the industry-developed common domain model.”In addition, the bond represents the “first cross-chain Delivery vs. Payment (DVP) settlement using an experimental CBDC [Central Bank Digital Currency] token.”Last April, the EIB successfully issued the first digital euro bond on a public blockchain. Goldman Sachs, Banco Santander, and Société Générale led the sale of the two-year €100 million digital bond. Regarding today’s novel digital bond issuance on a private blockchain, Ricardo Mourinho Félix, EIB’s Vice President, commented: “Blockchain has the potential to disrupt a wide range of sectors. It plays a central role in the success of Europe’s green and digital transitions, and strengthens our technological sovereignty. Innovation is part of the EIB’s identity and issuing this fully digital bond is another important step in helping to develop a fully digital ecosystem.”

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National Bank of Ukraine releases draft concept for digital hryvnia

The National Bank of Ukraine (NBU) has introduced a draft concept for its central bank digital currency (CBDC) candidate digital hryvnia, or e-hryvnia.Ukraine’s central bank on Nov. 28 released a statement on the concept of e-hryvnia, which aims to perform all the functions of money by supplementing cash and non-cash forms of the hryvnia as its key purpose.The NBU said it has presented the e-hryvnia concept and continues developing the CBDC project with participants of the virtual assets market, payment firms and state bodies. According to the announcement, the central bank is currently considering and developing three possible CBDC options, depending on design and main characteristics.The first option describes the e-hryvnia for retail non-cash payments with the possible functionality of “programmed” money through smart contracts. A retail e-hryvnia would enable the implementation of targeted social payments and the reduction of government expenditures on administration, the NBU said.The second CBDC option envisions the e-hryvnia available for usage in operations related to cryptocurrency exchange, issuance and other virtual asset operations. “The e-hryvnia can become one of the key elements of quality infrastructure development for the virtual assets market in Ukraine,” the announcement notes.The third option includes the e-hryvnia to enable cross-border payments in order to provide faster, cheaper and more transparent global transactions.“The development and implementation of the e-hryvnia can be the next step in the evolution of the payment infrastructure of Ukraine,” Oleksii Shaban, director of NBU payment systems and innovative development department, said in the statement. He added that a Ukrainian CBDC could have a positive impact on ensuring economic security and strengthening the monetary sovereignty of the state, as well as e sustainable economic growth.Related: Russia aims to use CBDC for international settlements with ChinaAccording to the announcement, the Ukrainian Intellectual Property Institute registered the trademark “e-hryvnia” for the NBU in October 2022.As previously reported, the NBU has been actively studying the possibility of issuing a CBDC in recent years, hiring blockchain developers and cooperating with major industry projects like the Stellar Development Foundation.According to the regulator, the NBU launched a pilot project ​to issue the e-hryvnia for blockchain-based retail payments back in 2018.

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Tokenized government bonds free up liquidity in traditional financial systems

A handful of government-backed financial institutions have been exploring tokenization use cases to revolutionize traditional financial systems. For instance, El Salvador’s Bitcoin Volcanic bond project has been in the works for over a year and aims to raise $1 billion from investors with tokenized bonds to build a Bitcoin city. The Central Bank of Russia has also expressed interest in tokenized off-chain assets. In addition, the Israeli Ministry of Finance, together with the Tel Aviv Stock Exchange (TASE), recently announced the testing of a blockchain-backed platform for digital bond trading. Cointelegraph Research’s 2021 Security Token Report found that most securities will be tokenized by 2030. While notable, the potential behind tokenized government bonds appears to be massive, as these assets can speed up settlement time while freeing up liquidity within traditional financial systems. Brian Estes, CEO of Off the Chain Capital and a member of the Chamber of Digital Commerce, told Cointelegraph that tokenizing a bond allows for faster settlement, which leads to reduced costs. “The time of ‘capital at risk’ becomes reduced. This capital can then be freed up and used for higher productive use,” he said. Factors such as these have become especially important as inflation levels rise, impacting liquidity levels within traditional financial systems across the globe. Touching on this point, Yael Tamar, CEO and co-founder of SolidBlock — a platform enabling asset-backed tokenization — told Cointelegraph that tokenization increases liquidity by transferring the economic value of a real-world asset to tokens that can be exchanged for cash when liquidity is needed. “Because tokens communicate with financial platforms via a blockchain infrastructure, it becomes easier and cheaper to aggregate them into structured products. As a result, the whole system becomes more efficient,” she said. To put this in perspective, Orly Grinfeld, executive vice president and head of clearing at TASE, told Cointelegraph that TASE is conducting a proof-of-concept with Israel’s Ministry of Finance to demonstrate atomic settlement, or the instant exchange of assets. In order to demonstrate this, Grinfeld explained that TASE is using the VMware Blockchain for the Ethereum network as the foundation for its beta digital exchange platform. She added that TASE will use a payment token backed by the Israeli shekel at a one-to-one ratio to conduct transactions across the blockchain network. Recent: TON Telegram integration highlights synergy of blockchain communityIn addition, she noted that Israel’s Ministry of Finance will issue a real series of Israeli government bonds as tokenized assets. A live test will then be performed during the first quarter of 2023 to demonstrate atomic settlements of tokenized bonds. Grinfeld said:“Everything will look real during TASE’s test with the Israel’s Ministry of Finance. The auction will be performed through Bloomberg’s Bond Auction system and the payment token will be used to settle transactions on the VMware Blockchain for Ethereum network.”If the test goes as planned, Grinfeld expects settlement time for digital bond trading to occur the same day trades are executed. “Transactions made on day T (trade day) will settle on day T instead of T+2 (trade date plus two days), saving the need for collateral,” she said. Such a concept would therefore demonstrate the real-world value add that blockchain technology could bring to traditional financial systems. Tamar further explained that the process of listing bonds and making them available to institutions or the public is very complex and involves many intermediaries. “First the loan instruments need to be created by a financial institution working with the borrower (in this case, the government), which will be processing the loans, receiving the funds, channeling them to the borrower and paying the interest to the lender. The bond processing company is also in charge of accounting and reporting as well as risk management,” she said. Echoing Grinfeld, Tamar noted that settlement time can take days, stating that bonds are structured into large portfolios and then transferred between various banks and institutions as a part of a settlement between them.Given these complexities, Tamar believes that it’s logical to issue tokenized government bonds across a blockchain platform. In fact, findings from a study conducted by the crypto asset management platform Finoa and Cashlink show that tokenized assets, such as government bonds, could result in 35%–65% cost-savings across the entire financial system value chain. From a broader perspective, Perianne Boring, founder and CEO of the Chamber of Digital Commerce, told Cointelegraph that tokenized bonds also highlight how technology-driven innovations in financial instruments can provide investors with alternative financial products. “Generally, such bonds would come with reduced costs and more efficient issuance, and come with a level of transparency and monitoring capabilities that should appeal to investors who want greater control over their assets,” she said. Features such as these were recently demonstrated on Nov. 23, when Singapore’s DBS Bank announced it had used JPMorgan’s blockchain-based trading network Onyx to execute its first tokenized intraday repurchase transaction. Banks use repurchase agreements — also known as repos — for short-term funding by selling securities and agreeing to repurchase them later. Settlement usually takes two days, but tokenizing these assets speeds this process up. A DBS spokesperson told Cointelegraph that the immediate benefits of tokenized bonds or securities result in an improvement in operational efficiency, enabling true delivery vs. payment and streamlined processes with golden copies of records.Challenges may hamper adoption While tokenized bonds have the potential to revolutionize traditional financial systems, a number of challenges may slow adoption. For example, Grinfeld noted that while Israel’s Ministry of Finance has expressed enthusiasm in regards to tokenization, regulations remain a concern. She said: “To create new ways of trading, clearing and settlement using digital assets, a regulatory framework is needed. But regulations are behind market developments, so this must be accelerated.”A lack of regulatory clarity may indeed be the reason why there are still very few regions exploring tokenized government bonds. Varun Paul, director of central bank digital currencies (CBDCs) and financial market infrastructure at Fireblocks, told Cointelegraph that while many market infrastructure providers are exploring tokenization projects behind the scenes, they are waiting on clear regulations before publicizing their efforts and launching products into the market. Fireblocks is currently working with TASE and Israel’s Ministry of Finance to provide secure e-wallets for the proof of concept, which will enable the participating banks to receive tokenized government bonds. In addition to regulatory challenges, large financial institutions may find it difficult to grasp the technical implications of incorporating a blockchain network. Joshua Lory, senior director of Blockchain To Go Market at VMWare, told Cointelegraph that market education across all ecosystem participants will accelerate the adoption of the technology. Yet, Lory remains optimistic, noting that VMware Blockchain for Ethereum’s beta was announced in August of this year and already has over 140 customers requesting trials. While notable, Estes pointed out that blockchain service providers must also take into account other potential challenges such as back-end programming for brokerage firms to make sure they are equipped to report bonds accurately on their statements. Recent: After FTX: Defi can go mainstream if it overcomes its flawsAll things considered though, Estes believes that the tokenization of multiple assets is the future. “Not only bonds, but stocks, real estate, fine art and other stores of value,” he said. This may very well be the case, as Grinfeld shared that following the proof-of-concept, TASE plans to expand its range of tokenized asset offerings to include things such as CBDCs and stablecoins. “This POC will lead us toward a complete future digital exchange based on blockchain technology, tokenized assets, e-wallets and smart contracts,” she said. Adoption will likely take time, but Paul mentioned that Fireblocks is aware that financial market participants are interested in taking part in replicating TASE’s model in other jurisdictions: “We anticipate that we will see more of these pilots launching in 2023.” 

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BIS report finds uneven progress, differing motivations in African CBDC adoption

Mobile money has been a strong competitor to central bank digital currency (CBDC) in Africa, but many of the continent’s central bankers have greater faith CBDC, according to a Bank for International Settlements (BIS) report published Nov. 24. African central bankers also saw greater utility in CBDC for implementing monetary policy than bankers in other parts of the world, according to the BIS.Nineteen African central banks responded to the survey that served as a basis for the report, and all of them stated that they were actively interested in CBDC. Only Nigeria has issued a retail CBDC, the eNaira, meant for public use, while Ghana has a retail CBDC project in the pilot stage, and South Africa is currently running a project for a wholesale CBDC, meant for institutional use. A new survey with 19 African central banks shows that the main concern regarding #CBDCs is cybersecurity, even more than elsewhere. High operational burden for the central bank is also a bigger concern than in other regions https://t.co/FzkCq5POOD pic.twitter.com/XqYHjRwyRv— Bank for International Settlements (@BIS_org) November 24, 2022Provision of cash was listed by African central bankers as a major motivation for the introduction of a CBDC for 48% of respondents. A CBDC would save money on the printing, transportation and storage of banknotes and coins, they said. Financial inclusion was mentioned by all respondents. Less than half the adult African population was banked in 2021. Related: Nigerians’ passion for crypto is stopping short at the eNairaSub-Saharan Africa accounts for two-thirds of the world’s money transfers by volume and more than half of all users. The entry of CBDC into this field could improve competition and lower costs, the report notes. A CBDC would “support new digital technologies and their integration with the broader economy.”Issuing and operating a CBDC is a daunting task:“Here African central banks highlight aspects very similar to other EMEs [emerging market economies …]: network resilience, the cost, availability and combinability of technologies, and their scalability and functionalities. The operational cost of such a complex system is high.” That was combined with cybersecurity concerns and the risk of low adoption in the minds of several of the central bankers. Bank disintermediation also ranked among the concerns, although bankers expected CBDCs to help implement monetary policy. Cost of remittances was a big concern for design.

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Bank of Japan to trial digital yen with three megabanks

Despite Japan’s uncertainty on whether to issue a central bank digital currency (CBDC), the Bank of Japan (BoJ) continues experimenting with a potential digital yen.The Japanese central bank has started a collaboration with three megabanks and regional banks to conduct a CBDC issuance pilot, the local news agency Nikkei reported on Nov. 23.The pilot aims to provide demo experiments for the issuance of Japan’s national digital currency, the digital yen, starting in spring 2023.As part of the trial, the BoJ is expected to cooperate with major private banks and other organizations to detect and solve any issues related to customer deposits and withdrawals on bank accounts. According to the report, the pilot will involve testing the offline functionality of Japan’s possible CBDC, targeting payments without the internet.Japan’s central bank plans to proceed with its CBDC experiment for about two years and make a decision on whether to issue a digital currency by 2026, the report notes. The news comes amid countries around the globe increasingly launching CBDC research and development initiatives, with countries like China leading the global CBDC race.As Cointelegraph reported on Nov. 22, the Reserve Bank of India is preparing to start a retail pilot of the digital rupee in collaboration with major local banks including the State Bank of India in December. In mid-November, the Federal Reserve Bank of New York’s Innovation Center announced the launch of a 12-week proof-of-concept CBDC pilot in partnership with banking giants like BNY Mellon, Citi, HSBC and others.Related: Japan’s International Payments System will test plastic cards for CBDCWhile the majority of the world has been rushing to launch a CBDC, some countries like Denmark have dropped out of the digital currency race. Among reasons for dropping their CBDC or CBDC-related projects, the central banks listed potential difficulties for the private sector, questionable value and benefits and other issues. Still, no central bank has ruled out the possibility of launching a CBDC completely.

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The Reserve Bank of India to launch a retail CBDC pilot in December

Having tested the wholesale usage of its central bank digital currency (CBDC), the Reserve Bank of India (RBI) is preparing to conduct the retail pilot of the “digital rupee.” The pilot should launch within a month.According to the Economic Times of India, the RBI is in the final stage of preparing the rollout of the retail digital rupee pilot. Among the participants are the State Bank of India, Bank of Baroda, ICICI Bank, Union Bank of India, HDFC Bank, Kotak Mahindra Bank, Yes Bank and IDFC First Bank. Reportedly, at some point, the pilot is going to include all the commercial banks in the country. Each bank participating in the trial will test the CBDC among 10,000 to 50,000 users. To integrate the new payment option, the banks will collaborate with PayNearby and Bankit platforms. The CBDC infrastructure will be held by the National Payments Corporation of India (NPCI). As the anonymous source specified to Indian journalists: “The e-rupee will be stored in a wallet, the denominations will be available as per the customer’s request, just like you request cash from an ATM. Banks are launching this only in select cities.”Related: Crypto regulation is 1 of 8 planned priorities under India’s G20 presidency — Finance MinisterBoth customers and merchants will have to download the special wallets for the CBDC, although later the RBI plans to fully integrate it with existing digital banking services. Reportedly, the digital rupee is intended as a supplement to the current payment system and not its replacement. The wholesale segment pilot for the digital rupee was launched by RBI on Nov. 1. Its main use case has been the settlement of secondary market transactions in government securities. However, no information on the successful ending of the wholesale pilot is available at the time of writing.

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The nightmare continues for Sam Bankman-Fried and FTX — Law Decoded, Nov. 14-21

As much as we all would want last week to be about something else, it was still all about FTX. The Supreme Court of the Bahamas has approved two provisional liquidators from PricewaterhouseCoopers to oversee the assets of the crypto exchange, which is headquartered in the country. Several days later, ​​The Securities Commission of the Bahamas ordered the transfer of FTX Digital Markets’ digital assets to a digital wallet owned by the commission to protect “the interests of clients and creditors.”Turkey’s Financial Crimes Investigation Agency became the latest authority to join the investigation into FTX’s collapse. The regulator also noted that it had been monitoring FTX’s activities in accordance with the country’s Anti-Money Laundering (AML) laws. Meanwhile, United States and Bahamian authorities are reportedly discussing the possibility of extraditing Sam Bankman-Fried, former CEO of the company, back to the United States for questioning.In light of possible extradition, the renouncement of the legal firm Paul, Weiss from representing the entrepreneur’s interest doesn’t look optimistic. The reason behind the withdrawal is SBF’s series of cryptic tweets, which, according to his now ex-lawyer Martin Flumenbaum, were “incessant and disruptive” and negatively impacted the reorganization efforts of FTX. It would certainly be interesting to listen to Bankman-Fried in Congress and the invitation is already there — the United States House Financial Services Committee has scheduled a December hearing aimed at exploring the collapse of crypto exchange FTX and “broader consequences for the digital asset ecosystem.” The Committee expects to hear from individuals and companies involved in the events, which could possibly involve not only SBF but also Binance CEO Changpeng Zhao. NY Fed launches CBDC pilot program with major banksThe Federal Reserve Bank of New York’s Innovation Center is launching a 12-week proof-of-concept pilot for a central bank digital currency (CBDC). Banking giants including BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank and Wells Fargo will be participating in the pilot by issuing tokens and settling transactions through simulated central bank reserves. The proof-of-concept project will test the “technical feasibility, legal viability, and business applicability” of distributed ledger technology, as well as simulate tokens and explore regulatory frameworks. Continue reading Russian bill could legalize crypto miningA new bill, introduced into the Russian State Duma, the lower house of parliament, would legalize cryptocurrency mining and the sale of the cryptocurrency mined. Chairman of the Duma Financial Markets Committee Anatoly Aksakov told the local press that he expected the bill to pass all three parliamentary readings in December to come into force on Feb. 1. Other sources said the bill would become law on Jan. 1. A Russian platform for cryptocurrency sales will be set up if the law is passed, and Russian miners will be able to use foreign platforms. In the latter case, Russian currency controls and regulations would not apply to the transactions, but they would have to be reported to the Russian tax service.Continue reading South Korea investigates crypto exchanges for listing native tokensKorea’s financial authority, Korea Financial Intelligence Unit (KoFIU), launched a probe into crypto exchanges in relation to listing their in-house, self-issued tokens. While Korean crypto exchanges are barred from issuing native tokens, KoFIU’s probe is to ensure regulatory adherence for investors’ safety. Flata Exchange is one of the primary suspects and is being investigated for listing its in-house token, FLAT, back in January 2020, as reported by local media Yonhap. Major exchanges such as Upbit and Bithumb have been cleared by the authorities and the investigations will be more focused on smaller exchanges.Continue reading

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NY Fed launches 12-week CBDC pilot program with major banks

The Federal Reserve Bank of New York’s Innovation Center, or NYIC, announced that it would be launching a 12-week proof-of-concept pilot for a central bank digital currency, or CBDC.In a Nov. 15 announcement, the New York Fed said the program would explore the feasibility of an “interoperable network of central bank wholesale digital money and commercial bank digital money operating on a shared multi-entity distributed ledger” on a regulated liability network. Banking giants including BNY Mellon, Citi, HSBC, Mastercard, PNC Bank, TD Bank, Truist, U.S. Bank and Wells Fargo will be participating in the pilot by issuing tokens and settling transactions through simulated central bank reserves.“The NYIC looks forward to collaborating with members of the banking community to advance research on asset tokenization and the future of financial market infrastructures in the U.S. as money and banking evolve,” said NYIC Director Per von Zelowitz.The proof-of-concept project will test the “technical feasibility, legal viability, and business applicability” of distributed ledger technology, as well as simulate tokens and explore regulatory frameworks. The NY Fed said the project could “potentially be extended to multi-currency operations and regulated stablecoins.”Related: US lawmaker lays out case for a digital dollarThe launch of the NYIC pilot project followed the center releasing research on its wholesale central bank digital currency program on Nov. 4. The first phase of the CBDC trial, dubbed Project Cedar, tested foreign exchange spot trades to determine whether a blockchain solution could improve “speed, cost, and access to cross-border wholesale payments.”Federal regulators in the United States have not reached any consensus on whether to launch a digital dollar in the country, but agencies and those in the private sector have been exploring the possibility. Following U.S. President Joe Biden issuing an executive order aimed at establishing a framework on digital assets, some lawmakers questioned what Congress’ role might be in passing legislation in support of a CBDC and how a digital dollar might curtail similar innovations from the private sector.

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New York Fed collaborates with Singapore MAS to explore CBDCs

The Federal Reserve Bank of New York’s New York Innovation Center (NYIC) and the Monetary Authority of Singapore (MAS) will launch a joint experiment with wholesale central bank digital currencies (wCBDCs). Regulators are keen to test the wCBDCs potential for cross-border wholesale payments. On Nov. 11, the MAS announced the launch of Project Cedar Phase II x Ubin+. In its framework, NYIC and MAS will leverage wCBDCs as a settlement asset in cross-border cross-currency transactions. The aim is to assess the possible ability of wCBDC to reduce settlement risk. Leong Sing Chiong, Deputy Managing Director at MAS, highlighted the concept of “interoperability,” which lies at the core of the experiment: “The project takes a practical approach and designs for any future wholesale CBDC to be interoperable across networks, while maintaining each network’s autonomy.”As the statement goes, Project Cedar Phase II x Ubin+ will not advance any specific policy outcome, nor does it signals any imminent decisions on issuing a CBDC by the Federal Reserve. A report with the project’s findings should be released in 2023. On Nov. 4, NYIC released a report on the first phase of Project Cedar. During the first phase, spot transactions were carried out between different currencies on different ledgers through a permissioned blockchain network with an unspent transaction data output model.Related: The Clearing House stands up for bank rights, opposes CBDC in comments for US TreasuryProject Cedar complements the Boston Fed’s work on a retail CBDC in Project Hamilton, being conducted in conjunction with the Massachusetts Institute of Technology’s Digital Currency Initiative. Ubin+ is MAS’ international initiative to improve efficiency and reduce the risks of cross-border foreign exchange settlement by advancing cross-border connectivity and interoperability of wholesale digital currencies.The Fed still has no plans to issue a CBDC, NY Fed Executive Vice President and Head of Markets Michelle Neal said at a presentation in Singapore, but it has investigated foreign exchange spot settlement “from the perspective of the Federal Reserve.”

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The Clearing House stands up for bank rights, opposes CBDC in comments for US Treasury

United States payment systems operator The Clearing House has released its response to a Treasury Department request for comment on “digital-asset-related illicit finance and national security risks as well as the publicly released action plan to mitigate the risks.” The Clearing House found significant security serious risks associated with digital assets, but was concerned that banks should have the same opportunities to participate in the market as nonbanks. The Treasury Department issued its request for comments Sept. 20 as part of its ongoing response to President Joe Biden’s Executive Order 14067 of March 9, 2022, “Ensuring Responsible Development of Digital Assets.” In its 22-page response letter, The Clearing House addresses some of the questions posed by the Treasury, and it highlights five main points that its sees as ways to mitigate national security and illicit finance risks posed by privately issued non-bank digital assets (many cryptocurrencies and stablecoins) and U.S. government tokens (CBDCs). The letter, dated Nov. 3, was made public on Nov. 10.Leaders from #fintech and traditional financial services agree: a government token (central bank digital currency #CBDC) is a “perilous societal prospect” https://t.co/AO1Jo2Gm8L— The Clearing House (@TCHtweets) October 28, 2022The Clearing House called for a federal prudential framework with standards for digital assets service providers that are equivalent to those for depository financial institutions engaged in functionally similar activities. Furthermore, banks “should be no less able to engage in digital-asset-related activities than nonbanks.” The company minces no words on CBDC, stating:“The risks associated with the possible issuance of a CBDC in the U.S. outweigh its potential benefits and, therefore, it should be determined that a CBDC is not in the national interest.”In the event the United States decides to adopt a CBDC, “the foundational requirements in place to prevent criminal and illicit use of commercial bank money must be applied to a U.S. CBDC in such a way that criminal actors are not incentivized to use CBDC,” the company writes. Related: US Treasury report encourages instant payment, recommends more CBDC researchThe Clearing House sees limited appeal for a U.S. CBDC in any case:“Intermediaries must have a clear business case for assuming the customer identification/identity verification, AML/CFT screening, and sanctions compliance obligations, particularly as the risks associated with such assumption may, without fees, be unsupported by the low margins typically associated with the provision of custodial services.” The Clearing House is owned by 23 banks and payment companies. It was founded in 1853.

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Nifty News: Royalty-enforcing NFTs a 'new asset class,' South Korea buys NFTs with CBDC, and more

Royalty enforcing NFTs to be a ‘new asset class’: Magic Eden CEOJack Lu, the CEO of Solana-based nonfungible token (NFT) marketplace Magic Eden has floated the idea of NFTs designed to enforce royalties.Lu said in an address at Solana’s Breakpoint 2022 conference on Nov. 5 that these NFTs could “give rise to a new asset class” as the space grapples with the debate around opt-in royalties.He added that “creators need a sustained revenue model” and while royalties were one of those models there is “no way” to enforce them with the “current design” but added there are “many new innovations that could be made available to them.”Lu noted that over the past months, Magic Eden had spoken to “dozens, if not 100” NFT creators across differing NFT use case and that they found their needs “actually are very, very divergent.”“There is a real opportunity to give rise to a new asset class, and this asset class will have special properties but also have special trade-offs. So it could enforce royalties at a technological high technological level.”Those “trade-offs” would mean NFT creators would have “some level of control” Lu explained but added in the talks Magic Eden had with creators and holders that they were “willing to accept some of these trade-offs” in order to ensure that they could bring their business models to fruition.According to Lu, Magic Eden is set to launch an asset “next week” that can enforce royalties in partnership with Cardinal, a protocol enabling NFT conditional ownership and the privacy-oriented browser Brave.Jack Lu at Solana Breakpoint conference. Source: YouTubeSouth Korea tests buying NFTs with CBDCThe Bank of Korea (BOK) — South Korea’s central bank — has reportedly tested buying NFTs with its Central Bank Digital Currency (CBDC) according to a Nov. 7 report from Yonhap News.The BOK said it had completed a simulation and research project carried out over the past ten months since Aug. 2021, creating a simulated environment for its CBDC using distributed ledger technology (DLT).The project tested the usual functions needed for a digital currency, including issuing, transacting and remittances using the digital won, while the report also noted that “the process of purchasing NFTs with CBDCs was also implemented.”It’s reported that this process was done through the simulated environment and a “digital asset system” built using differing DLT platforms with smart contract functionality, without going into further detail. The BOK also tested the possibility of applying Zero Knowledge Proofs (ZKPs) to strengthen the protection of personal information. ZKP protocols can be used for forms of digital identities with some iterations using NFTs as a digital ID solution, although it’s unknown if the NFTs transacted in the project were related to digital identities.South Korea has stated its plan to allow its citizens access to blockchain-powered digital IDs in 2024 that could be used in finance, healthcare, taxes, and transportation.TinyTap NFTs sell out giving over $100K to teachersAn NFT project by Animoca Brands in conjunction with its subsidiary TinyTap has seen six NFTs featuring a children’s educational course sell at auction for a total of around 138 Ether (ETH) — around $228,000, Animoca said on Nov. 7.The project was created as a way for educators to create content and receive a share of revenues when their course is purchased and used by learners according to Animoca.The six teachers who created the courses were given a 50% cut of thes sale of the NFT, generating them around $111,000 in ETH, while the teachers will also receive a 10% ongoing share of revenue by their course.The teachers, courses, and sale price of the six NFTs sold at auction. Image: Animoca BrandsAnimoca calls the NFTs “Publisher NFTs” with each representing co-publishing rights to a course — which is a bundle of education-based games on a specific subject created by a teacher.The NFT owner is expected to promote their course and share the revenue and is entitled to keep up to 80% of future revenue generated by their own marketing and publishing of the course.Trademark filings show Rolex is timing a Metaverse playRolex isn’t wasting any time gearing up to launch a Web3 play with trademark filings showing the luxury watch brand is ready to tick over into the Metaverse.The United States Patent and Trademark Office (USPTO) filings shared by trademark attorney Mike Kondoudis on Twitter show Rolex is ticking off a list of crypto and NFT-related trademarks to protect its brand across virtual realms.Luxury watchmaker #ROLEX has filed a trademark application claiming plans for:⌚️ NFTs + NFT-backed media + NFT marketplaces⌚️ Crypto keys and transactions⌚️ Virtual goods auctions⌚️ Virtual and cryptocurrency exchange + transfer#NFTs #Metaverse #Crypto #Web3 #Perpetual pic.twitter.com/J8C93Qcybj— Mike Kondoudis (@KondoudisLaw) November 7, 2022The filings suggest Rolex wants to offer NFTs, crypto wallets, crypto transactions and hints at a potential metaverse as it wishes to provide an “online space for buyers and sellers” and hold “virtual interactive auctions” although time will tell what type of online space Rolex may build.More Nifty News:Companies are showing a big appetite for trademark applications as crypto, Web3, and related filings have soared in 2022, reaching 4,708 at the end of October compared to the 3,547 filed in all of 2021.Related: NFTs still in ‘great demand’ as unique traders rise 18% in Oct: DappRadarThe Chinese city of Wuhan, the epicenter of the COVID-19 breakout, has reportedly axed its NFT plans aimed to boost its economy ruined by the pandemic amid increasing regulatory uncertainty on crypto and Web3 technologies in the country.

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