Mahi Sall, Advisor, Fintech-Bank Partnerships, Payments and Financial Inclusivity
January 25th, 2023
Mahi Sall is the CEO & Founder of FinXpair, a Berlin-based strategic advisory boutique firm focu[...]
Category Archives: FinTech and Alternative Finance
CRA Tax Implications for Individuals and Crypto Platforms
Crypto Tax | Nov 29, 2023
Image: Unsplash/Towfiqu barbhuiya
The Canadian Revenue Agency (CRA) Has Clarified That Crypto Deposits on Trading Platforms May Trigger Taxes
As deftly summarized in this November 2023 client update article from Goodman's LLP, the CRA suggests that:
A client holding cryptocurrency through a centralized Crypto Trading Platform (CTP) may not actually own the cryptocurrency for Canadian income tax purposes.
Depositing cryptocurrency with a trading and lending platform could be considered a disposition for Canadian tax purposes, making it a taxable event for the client.
Notes
- The CRA's response was based on two specific questions. The first question involved a Canadian taxpayer who lost bitcoin due to fraud on a platform. The CRA's response highlighted the need to determine the nature of ownership and the platform's liability in such cases.
- The loss's tax treatment depends on whether the cryptocurrency was held as a business or as a capital investment and the contractual relationship between the taxpayer and the CTP.
See: Proposed Changes to Crypto Mining GST/HST Rules: What’s Capture and What’s Not?
- The second question addressed the tax implications when a taxpayer transfers bitcoin to a platform offering a return, payable in bitcoin. The CRA concluded that such a transfer likely constitutes a disposition for tax purposes, as the platform acquires the right to use and dispose of the assets.
Takeaways
The CRA's positions have substantial implications for both CTPs and their Canadian clients.
- CTPs and crypto platforms should review their contractual arrangements to determine if they imply a transfer of ownership of the cryptocurrency to them. They might need to modify their agreements to prevent unintended tax consequences for their clients.
- Canadian taxpayers could face significant unforeseen tax liabilities. Depositing cryptocurrency with a CTP, even without the intention of immediate disposal, could realize capital gains.
See: UK Leading Charge in Global Crypto Tax Crackdown
It is crucial for both parties to understand these tax implications and adjust their strategies accordingly. CTPs, in particular, should consider revising their user agreements to minimize the risk of unintended tax consequences for their clients.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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BoC Speech: Essence of the New Retail Payment Activities Act
Canadian Payments Regulation | Nov 30, 2023
Image: Freepik/macrovector
New Retail Payments Regulatory Framework
On November 28, 2023, Ron Morrow, the Executive Director – Supervision at the Bank of Canada delivered a speech about the new Retail Payments Activities Act in Canada at the Central 1 Momentum Summit in Vancouver, BC.
See: Canada’s New Retail Payment Regulations: Registration and Compliance
- Passed in the summer of 2021, the new Retail Payment Activities Act in Canada is a major shift in the supervision of retail payments, expanding the oversight of the Bank of Canada to include a broader range of Payment Service Providers (PSPs), many of which were previously not subject to supervision beyond anti-money laundering regulations. The Bank of Canada is focused on managing risks associated with payment activities. The robustness of national payment systems and rigorous supervisory roles of central banks have increased, especially after events like the Herstatt Bank failure in 1974 and the 2008-09 financial crisis.
Registration and Compliance
Under the new regime, PSPs are required to register with the Bank of Canada and comply with minimum standards for managing operational risks and safeguarding end-user funds. This includes separating end-user funds from operating funds and ensuring their protection through trust, insurance, or guarantees.
Scope and Impact
The Act covers approximately 2,500 providers, both in Canada and internationally, including payment processors, digital wallets, and other payment technology companies. The focus is on the functions performed by these entities rather than their business identity.
Global Alignment
In developing this framework, the Bank of Canada aligned its approach with international standards, drawing insights from similar regulatory regimes in the UK, EU, and Singapore. This global perspective ensures that Canada's approach is in harmony with the best practices worldwide.
Enforcement and Flexibility
The Bank will use various tools for enforcement, including warning letters, public notices of violation, and monetary penalties, with a graduated approach depending on the circumstances. The regime acknowledges the diversity of business models among PSPs and aims for a common standard with enough flexibility to apply across all types of providers.
See: BoC Update on The Digital Canadian Dollar Initiative
For the complete details, you can visit the Bank of Canada's website. The information provided here is based on the first part of the speech, and the remaining part of the speech might contain additional details.
Read the full speech ==> here
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Reflecting on Charlie Munger’s Investment Wisdom
Investing | Nov 29, 2023
Image: Unsplash/Jeremy Bishop
Reflecting on Charles T. Munger who passed away yesterday at the age of 99 in Santa Barbara, California
- Charles Thomas Munger (January 1, 1924 – November 28, 2023)
- The recent passing of Charlie Munger, the esteemed vice-chairman of Berkshire Hathaway (and billionaire), marks the end of an era in the investment world. As reported by The New York Times, Munger's influence extended beyond investment strategies to shaping the very culture of Berkshire Hathaway. His emphasis on integrity, patience, and rational decision-making are principles that fintechs and investors can adopt for long-term success.
- Born in Omaha in 1924, Munger served in the Army Air Corps and later graduated from Harvard Law School. He practiced law before shifting to investing, where he made his first million dollars.
- Munger was also known for his philanthropic efforts, particularly in architecture, donating millions to university projects. He was active in Berkshire Hathaway into his 90s and served as chairman of Good Samaritan Hospital in Los Angeles.
- Despite being overshadowed by Warren Buffett, Munger's influence at Berkshire Hathaway was significant. He was known as the originator of the company's investing approach, shifting Buffett's strategy from buying undervalued companies to investing in solid brand-name businesses at fair prices.
Top 5 Charlie Munger Quotes (more here)
Munger, renowned for his sharp wit and profound wisdom, leaves behind a legacy that continues to influence investors and businesses globally. As we reflect on his remarkable life, let's delve into some of his most impactful quotes and their relevance to the fintech sector and investors today.
See: Buffet-backed Nubank to Launch ‘Nucoin’ Loyalty tokens on the Polygon Blockchain
"The big money is not in the buying and selling ... but in the waiting."
Patience is key in investment. Fintech startups should focus on long-term value creation rather than short-term gains. Investors should look for companies with sustainable business models that promise growth over time.
"Knowing what you don't know is more useful than being brilliant."
Humility and awareness of one's limitations are crucial in the rapidly evolving fintech landscape. Both fintechs and investors should continuously seek knowledge and be open to learning.
"The secret to happiness is to lower your expectations."
Over-optimism about technology or market potential can lead to disappointments. In the context of fintech and investing, this could mean managing expectations realistically.
"This is a good life lesson: getting the right people into your system is the most important thing you can do."
The success of fintech companies heavily relies on the team. Hiring the right talent and nurturing a culture of innovation and integrity is vital.
"Three rules for a career: 1) Don’t sell anything you wouldn’t buy yourself; 2) Don’t work for anyone you don’t respect and admire; and 3) Work only with people you enjoy."
Ethics and personal satisfaction are paramount. Fintechs should build their businesses on products they believe in, foster respectful cultures, and value their teams.
See: Investing for Your Future: Setting Yourself Up for Financial Stability
Wisdom That Transcends Time and Boundaries
His insights are particularly relevant in today's dynamic fintech environment, where ethical considerations, long-term planning, and a culture of continuous learning are more important than ever. As we honor his legacy, let's carry forward these lessons to create more sustainable and value-driven fintech ecosystems.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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BoC Update on The Digital Canadian Dollar Initiative
Canadian Digital Dollar | Nov 29, 2023
Image by katemangostar on Freepik
Bank of Canada Publishes Stakeholder Feedback on The Canadian Digital Dollar Initiative
Since 2020, the Bank of Canada has actively engaged with Canadians and stakeholders to gather insights on the digital Canadian dollar. This has included diverse discussions with the financial sector, focus groups, civil society groups, and an online public questionnaire. The Bank of Canada's report, "A Digital Canadian Dollar: What we heard 2020–23 and what comes next", provides a feedback lens across several themes.
Key Feedback Themes
- There's a shared interest in accessibility and financial inclusion ensuring that the digital dollar caters to underserved communities, with a focus on making it accessible without stringent identification requirements. This approach aims to bridge gaps in current digital payment offerings and promote universal access.
- Stakeholders emphasized the importance and concerns of privacy, advocating for a digital currency that offers the anonymity of banknotes. The public expressed strong reservations about sharing personal information and the potential overreach of privacy laws.
See: Bank of Canada Publishes Staff Paper on ‘Unmet Payment Needs and CBDCs
- The importance of maintaining access to physical currency was highlighted, with suggestions to mandate merchant acceptance of banknotes to support marginalized communities.
- The need for robust cybersecurity measures was a common concern, with varying levels of confidence in the Bank's ability to provide such security. The idea of a digital dollar functioning without an internet connection was also discussed for practical resilience and inclusivity.
- Financial institutions such as banks and credit unions expressed the need for more detailed information to understand the potential impact on their business models and financial stability. Concerns were raised about the digital dollar replacing bank deposits and accelerating bank runs during crises.
The decision to introduce a digital dollar will ultimately be made by Canadians through their representatives in Parliament, with a focus on balancing privacy, accessibility, and financial stability. The Bank is exploring various models and technologies to support a potential digital dollar, ensuring readiness for the future digital economy.
See: BoC: Redefining Financial Inclusion for CBDCs
Looking Forward
While the path forward involves complex considerations and diverse stakeholder interests, the final decision, however, rests with Canadians and their representatives, ensuring that any future digital currency aligns with the nation's values and needs.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Support NCFA by Following us on Twitter!Follow @NCFACanada |
Exploring the Controversy of SEC’s In-House Judges
Regulation | Nov 29, 2023
Image: Unsplash/Sasun Bughdaryan
Elon Musk and Mark Cuban Support Legal Challenge Against SEC's In-House Judges
Elon Musk and Mark Cuban are backing hedge-fund manager George Jarkesy in a significant legal battle against the Securities and Exchange Commission (SEC). This case, now before the US Supreme Court, questions the SEC's use of in-house judges for imposing penalties. Jarkesy's argument, supported by Musk and Cuban, is centered on the constitutional right of defendants in SEC cases to have a jury trial. This challenge could reshape how the SEC and potentially other regulatory bodies like the Federal Trade Commission conduct their enforcement actions.
The Problems with Conflicts and Power Imbalance
Background on George Jarkesy's Case
- George Jarkesy, accused by the SEC in 2013 of misleading investors, is challenging the SEC's internal judicial process. He argues for the right to a federal jury trial in such cases. The Supreme Court is considering whether to limit the SEC's ability to use in-house judges, a decision that could significantly impact the agency's enforcement strategy.
- A ruling in favor of Jarkesy could affect not only the SEC but also other federal agencies that use in-house judges, like the Federal Trade Commission. Critics of the SEC's current system argue it lacks fairness, as defendants have limited rights compared to those in federal courts, and the SEC decides which cases are handled in-house.
See: Hester Peirce Reaffirms That the SEC’s Current Approach to Crypto Is ‘Not a Good Way of Regulating’
- Elon Musk and Mark Cuban, both of whom have had their own run-ins with the SEC, are supporting Jarkesy's case, highlighting its potential impact on future SEC enforcement actions.
Importance of the Case
This case challenges the fundamental process of how regulatory bodies like the SEC conduct enforcement. A decision in favor of Jarkesy could lead to more defendants opting for jury trials, potentially making it harder for the SEC to secure settlements and enforce regulations. It also raises significant questions about the balance of power between regulatory agencies and the rights of individuals and companies in the financial sector. The decision, expected by June 2024, will be closely watched by investors, legal experts, and regulatory bodies.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Support NCFA by Following us on Twitter!Follow @NCFACanada |
The Methods and Benefits of Sustainable Construction
Nov 29, 2023
Image by studiogstock on Freepik
Nowadays environmental concerns have reached critical levels, that’s why sustainable construction practices have emerged as a beacon of hope. These practices not only help protect our planet but also offer numerous advantages to homeowners and builders alike. In this article, we will dig into the methods and merits of sustainable construction.
Methods of Sustainable Construction
Here are some key principles and methods integral to sustainable construction:
1. Energy Efficiency
One of the foundational pillars of sustainable construction is ensuring that homes are constructed with energy efficiency and environmental sustainability at their core. This is where the auditing platform for home renovation grants comes into play. Such platforms provide valuable resources and support to homeowners and builders who are committed to accessing grants and incentives for sustainable construction projects.
Sustainable construction places a strong emphasis on optimizing energy usage. Lighting serves as a crucial component of any building, and the choice of lighting fixtures holds the potential to dramatically impact energy efficiency. LED lights have emerged as the go-to choice for sustainable construction due to their myriad of benefits. LED lights are remarkably energy-efficient, consuming significantly less electricity compared to traditional incandescent or fluorescent bulbs. This substantial reduction in energy consumption translates into lower utility bills and a considerably smaller carbon footprint.
What's more, LED lights boast an extended lifespan, requiring fewer replacements, which leads to reduced maintenance costs and less waste. Moreover, LED lighting can seamlessly integrate with smart lighting systems, affording precise control and automation to further optimize energy usage within a building.
2. Green Insulation and Green Buildings
Sustainable construction often employs eco-friendly insulation materials that have a lower environmental impact. Additionally, green building designs prioritize features like passive solar heating, natural ventilation, and efficient space planning to reduce energy demands and create more comfortable living and working environments.
3. Recycled Materials
Reusing and recycling construction materials, such as reclaimed wood, recycled steel, and repurposed bricks, helps reduce the demand for new resources and minimizes waste sent to landfills. Sustainable construction embraces the concept of "reduce, reuse, and recycle" in every phase of a project.
Steel buildings have emerged as a cornerstone of sustainable construction for several compelling reasons. Firstly, steel is renowned for its exceptional durability and longevity, reducing the need for frequent maintenance and replacements. This durability inherently contributes to the overall sustainability of a building.
Additionally, steel buildings can be meticulously designed to be energy-efficient, incorporating features like insulation, cool roofing, and energy-efficient windows to minimize energy consumption.
4. Cool Roofs
Cool roofs, designed to reflect more sunlight and absorb less heat than traditional roofs, help reduce indoor temperatures and the urban heat island effect. This can lead to lower cooling costs and increased comfort for occupants.
5. Water Management
Sustainable construction employs innovative water management techniques like rainwater harvesting, graywater recycling, and efficient plumbing systems to reduce water consumption. These methods conserve this precious resource and decrease the energy required for water treatment and distribution.
6. Energy Conservation
Beyond energy-efficient technologies, sustainable construction advocates for energy conservation through mindful design. This includes features like well-placed windows for natural daylighting, smart building controls, and passive design strategies that reduce the need for artificial lighting and heating.
7. Low-Impact Landscaping
Sustainable construction extends to the surrounding landscape, where native plants, permeable pavements, and water-efficient irrigation systems are used to create outdoor spaces that complement the eco-conscious ethos of the building itself.
Benefits of Sustainable Construction
Here are the common benefits of sustainable construction:
1. Economic Prosperity
Sustainable buildings are more energy-efficient, resulting in lower utility bills for occupants. Reduced maintenance expenses, thanks to the use of durable and eco-friendly materials, further contribute to financial efficiency.
The commitment to sustainability also positions companies and organizations as responsible corporate citizens, improving their reputation and attracting environmentally conscious customers and investors. In this way, sustainable construction not only bolsters the bottom line but also promotes economic resilience and competitiveness in an increasingly environmentally aware market.
2. Improved Quality of Life
Sustainable construction places a premium on the well-being of building occupants. This leads to healthier living environments, minimizing the risk of respiratory issues and allergies. Additionally, access to natural light, along with thermal comfort, has been linked to increased productivity and overall well-being, improving the quality of life for occupants.
Sustainable construction thus goes beyond the structure itself, it fosters spaces where individuals thrive, leading to happier and more productive communities.
3. Financial Efficiency
Energy-efficient designs and technologies reduce energy consumption, leading to significantly lower utility bills for building occupants. The incorporation of renewable energy sources, such as solar panels, can even turn buildings into energy producers, generating income through excess energy sold back to the grid.
Moreover, sustainable construction projects often qualify for tax incentives, rebates, and grants offered by governments and municipalities. These financial incentives offset initial investments and make sustainable building practices more financially attractive for builders and developers.
Additionally, the use of durable and low-maintenance materials, coupled with efficient building systems, reduces ongoing operational and maintenance expenses. This translates into further cost savings over the life of the building, solidifying the financial efficiency of sustainable construction.
4. Health and Comfort
Sustainable buildings are often designed to offer improved indoor air quality and natural lighting, which can significantly enhance the health and comfort of occupants. Enhanced ventilation and reduced exposure to harmful chemicals in building materials contribute to a healthier living environment.
5. Market Value
Sustainable buildings tend to command higher market values and are highly sought after by environmentally conscious buyers. This increased demand can translate into higher property resale values, making sustainable construction a sound financial investment.
See: Sustainability: A Must for Fintech Growth
In conclusion, sustainable construction practices offer a multitude of benefits for homeowners, builders, and our planet. Embracing sustainability in construction allows us to create greener, more energy-efficient, and cost-effective buildings while contributing to a healthier planet for generations to come. The journey toward sustainable construction is not only responsible but also highly rewarding for all stakeholders involved.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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Support NCFA by Following us on Twitter!Follow @NCFACanada |
Amazon Launches ‘Q’ AI Chatbot for Businesses
AI | Nov 29, 2023
Image: Unsplash/Sunrise King
Amazon has recently unveiled 'Q', an innovative AI-powered chatbot designed for businesses operations offering tailored solutions and advice
Q was announced at Amazon’s re:Invent conference in Las Vegas, emphasizing its potential to revolutionize how businesses interact with AI technology and is trained on 17 years of AWS knowledge, offering tailored solutions and advice for a wide range of business queries.
It's priced at $20 per user per year and currently in public preview and can be integrated with various business-specific applications like Salesforce, Jira, Zendesk, and Gmail, allowing it to learn and adapt to a company's unique structure and needs.
Highlights
- The chatbot has advanced analytical capabilities and can analyze business data to identify customer pain points and suggest improvements, drawing from its extensive database and business-specific information.
- Beyond answering questions, Q can generate content like blog posts and emails, and execute tasks such as creating service tickets and updating dashboards, enhancing business efficiency.
See: Amazon’s Anthropic Investment Shaping Future Job Landscape
- Q is designed with a strong emphasis on security and privacy, ensuring that it only accesses and provides information that the user is authorized to see, addressing potential concerns about data privacy and AI ethics.
- Ties in with Amazon’s CodeWhisperer, enabling it to generate tests and draft plans for software development, further extending its utility in the tech development sphere.
Importance of 'Q'
Its ability to understand and interact with complex business environments, coupled with its emphasis on security and customization, positions it as a game-changer in the industry. Q offers businesses a powerful tool to enhance decision-making, automate routine tasks, and gain deeper insights into their operations. The integration of Q into various business functions promises to streamline processes, improve customer experiences, and foster innovation.
The National Crowdfunding & Fintech Association (NCFA Canada) is a financial innovation ecosystem that provides education, market intelligence, industry stewardship, networking and funding opportunities and services to thousands of community members and works closely with industry, government, partners and affiliates to create a vibrant and innovative fintech and funding industry in Canada. Decentralized and distributed, NCFA is engaged with global stakeholders and helps incubate projects and investment in fintech, alternative finance, crowdfunding, peer-to-peer finance, payments, digital assets and tokens, artificial intelligence, blockchain, cryptocurrency, regtech, and insurtech sectors. Join Canada's Fintech & Funding Community today FREE! Or become a contributing member and get perks. For more information, please visit: www.ncfacanada.org
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