Rojin Nair, Advisor
June 1st, 2021
eMarketer | Adriana Nunez | May 18, 2022
Mastercard’s new Biometric Checkout Program brings facial and fingerprint recognition technology to the point-of-sale (POS). By linking consumers’ biometrics with their payment cards Mastercard can grow card volume even if a physical card isn’t present during the transaction.
The program lets consumers link their facial and fingerprint biometrics to a payment card. Once enrolled in the system, customers can check out with their face or fingerprint, no cards or mobile phones necessary. Mastercard is working with several biometric and tech firms, including Payface and Fujitsu, to roll out the program. It kicked off a pilot in Brazil, where it is trialing the tech with Payface across five St Marche supermarket locations. Mastercard plans to launch similar pilots in the Middle East and Asia.
Contactless payments have become more popular during the pandemic, as consumers opt for more touchless checkout experiences. The number of global proximity mobile payment users is expected to hit 1.345 billion in 2022, up from 1.182 billion in 2020, per Insider Intelligence forecasts. QR code-based transactions and tap-and-pay cards are also fueling contactless payment growth. And growing fraud threats have made payment security a major focus for both businesses and consumers.
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, 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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The Defiant | Aleksandar Gilbert | May 16, 2022
Despite the recent collapse of Terra’s UST stablecoin, the U.K. government will move forward with proposed regulations that would facilitate stablecoins’ use “as a recognised form of payment,” according to a report from The Telegraph.
A spokesman for Her Majesty’s Treasury told the U.K.-based newspaper said:
Legislation to regulate stablecoins, where used as a means of payment, will be part of the Financial Services and Markets Bill which was announced in the Queen’s Speech.
The UK government said in a report issued last month after more than 12 months of study:
[Fiat-backed stablecoins] have the capacity to potentially become a widespread means of payment. An amended e-money framework can deliver a consistent framework to regulate stablecoin issuance and the provision of wallets and custody services.
Rishi Sunak, the Chancellor of the Exchequer said:
We want to see the businesses of tomorrow – and the jobs they create – here in the UK,” he continued, and by regulating effectively we can give them the confidence they need to think and invest long-term.
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, 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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Cambridge Centre for Alternative Finance | May 17, 2022
New mining map data, spanning the period from September 2021 to January 2022, included shows that the US has remained at the forefront of Bitcoin mining and extended its leading position (37.84%) amidst the global hashrate recovery. Following a sudden uptick in covert mining operations after the June 2021 government-mandated ban on Bitcoin mining, China has re-emerged as a major mining hub (21.11%). Kazakhstan (13.22%), Canada (6.48%), and Russia (4.66%) have been relegated to more distant places.
When we released the last update of the Cambridge Bitcoin Electricity Consumption Index (CBECI), mining map in October 2021 (covering data up to the end of August 2021), the Bitcoin network was grappling with the consequences of the Chinese ban on domestic mining activities. The government crackdown immediately resulted in a harsh decline of the total hashrate – the network’s aggregate computing power – which bottomed at 57.47 Exahashes per second (EH/s) on 27 June 2021.
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, 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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a16z crypto | Daren Matsuoka, Eddy Lazzarin, Chris Dixon, and Robert Hackett | May 17, 2022
This report is the first of what will be an annual overview of trends in the crypto industry, shared through the a16z crypto vantage point of both tracking data and across the countless entrepreneurs and builders we meet. It’s for anyone who seeks to understand the evolution of the internet, and where we are on the journey towards a decentralized, community-owned-and-operated alternative to the centralized tech platforms of web2 – especially as it touches creators and other builders.
Although crypto can be volatile and its cycles seem chaotic, there is an underlying logic at work, as Chris and Eddy first pointed out in 2020. (See slides 9 through 12 in the deck.) Whereas prices are often a lagging indicator of performance in some industries, in crypto they are a leading indicator. Prices are a hook. The numbers drive interest, which drives ideas and activity, which in turn drives innovation. We call this feedback loop “the price-innovation cycle”, and it has been the engine that has propelled the industry through multiple distinct waves since Bitcoin’s inception in 2009.
Analysts at Andreessen Horowitz wrote in a blog post Tuesday announcing the firm’s inaugural “State of Crypto” research report:
Price are a Hook. The numbers drive interest, which drives ideas and activity, which in turn drives innovation.
The take-rates of web2 giants are extortionate; web3 platforms offer fairer economic terms. (See slide 39 in the deck.) Compare Meta’s nearly 100% take-rates across Facebook and Instagram to NFT marketplace OpenSea’s 2.5%. As U.S. Congressman Ritchie Torres noted in a recent op-ed:
“You know something is profoundly wrong with our economy when Big Tech has a higher take rate than the mafia.
NFTs are the start of what is next for the creator economy, Dixon said. NFT (non-fungible tokens) creators earned on average $174,000 per creator in 2021. Music platform Spotify, which hosts 11 million artists, earned on average $636 per artist in 2021, the research report noted.
Creator payouts are just one example of crypto’s benefits; there are many others. Consider the financial system. The status quo has failed many people: More than 1.7 billion people don’t have bank accounts, per the World Bank.
Demand for decentralized finance or DeFi, and digital dollars, has increased dramatically in the past few years, even after accounting for the recent downturn, as the accompanying slides show. (See slides 26, 28, and 33.) For underserved and unbanked populations – 1 billion of whom have mobile phones – crypto offers a shot at financial inclusion. Projects like Goldfinch are expanding access to capital that would otherwise be unavailable in emerging markets.
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, 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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The Verge | Mitchell Clark | May 16, 2022
In the wake of the sudden collapse of TerraUSD, several other stablecoins’ values (whose values are supposedly pegged to the dollar) have started facing issues.
Deus Finance’s DEI coin is currently trading at around 66 cents and has been fluctuating since Sunday, reaching a low of around 52 cents early Monday morning.
Unlike other major stablecoins like USD Coin and Tether, which (allegedly) have actual dollars or assets backing them, DEI’s values are controlled by algorithms making trades. It’s not that there’s no collateral — as CoinTelegraph points out, there’s a DEUS token that you can use to get new DEI tokens and that you can receive if you redeemed DEI.
The Terra coin lost its peg to the dollar, eventually leading to massive inflation in the accompanying Luna coin. Eventually, the Terra blockchain was frozen, and many major exchanges delisted it from sale.
The destabilization of DEI and other coins has also opened up a new attack on a decentralized finance protocol called Scream, which lets users borrow cryptocurrencies by posting other ones as collateral. According to The Block, Scream had the price of DEI hardcoded to $1 — so attackers were able to buy DEI coins for less than $1 and post them as a full dollar’s worth of collateral. The result has left many Scream users unable to withdraw their deposits, left holding the bag on the protocol’s bad debts.
Another coin called Fantom USD has also depegged from the dollar and is currently trading around 83 cents. Scream also had Fantom USD’s listed at $1 despite its depegging — though that’s changing — letting people play the same trick in a separate currency.
As for Deus, it seems like there is a plan on getting DEI back to its $1 value. In a Medium post on Sunday, a member of Deus’ controlling organization said that Deus will start selling treasury bonds. Yes, like the ones the US Treasury does — in fact, the post says that the idea is “inspired by the best stable coinproject [sic] in human history, the US dollar.”
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, 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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CoinDesk | Sam Kessler, Shaurya Malwa | May 16, 2022
The Luna Foundation Guard (LFG), official stewards of Terra’s bitcoin (BTC) reserves, released a statement on Monday documenting how it disbursed millions of dollars' worth of crypto in its failed attempt to maintain the peg of stablecoin terraUSD (UST).
In the statement, LFG notes that it has almost entirely depleted its BTC reserves from around 80,000 bitcoins to 313. The remaining assets, which mostly comprise the crashed UST and LUNA tokens, will apparently be used to compensate investors.
In one of the most calamitous events in crypto memory, the $40 billion Terra ecosystem collapsed last week when the UST stablecoin, which is supposed to be worth $1, dropped to below 20 cents. The LUNA token, which is designed to serve as a sort of shock absorber for UST’s “algorithmic” dollar-pegging mechanism, crashed from $80 to below 2 cents.
In a tweet on Monday, LFG said it sold off most of the BTC in its reserves for UST as Terra’s ecosystem was beginning to collapse early last week.
Decrypt | Sander Lutz | May 15, 2022
In the aftermath of last week's historic collapse of Terra’s stablecoin, UST, and native token, LUNA, crypto leaders have emerged to offer their perspectives. UST isn’t backed by cash or assets like other leading stablecoins. Instead, an algorithm ties UST’s value to LUNA via a burning/minting mechanism designed to keep UST at $1. That mechanism collapsed last week, wiping out UST and LUNA, and with them some $40 billion in value.
Vitalik Buterin, creator of Ethereum:
“We need to emphasize that the two,” Buterin said, referring to algorithmic stablecoins and asset-backed stablecoins, “are very different. [The entire premise of UST] from inception [was] intentionally misleading and inherently flawed.
After days of uncharacteristic silence, Do Kwon reemerged on Friday with a new plan to resuscitate LUNA. The idea includes abandoning UST permanently and resetting LUNA to a 1 billion token circulation, with tokens to be distributed to both former holders wiped out by last week’s events, and to current holders.
ChengPeng Zhao, Binance CEO tweet:
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, 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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TechCrunch | Jacquelyn Melinek | May 10, 2022
Stablecoins have been a hot topic both on and off Capitol Hill. Earlier today, U.S. Treasury Secretary Janet Yellen pushed for regulation during an annual testimony in front of the Senate Banking Committee, at a time where Terra’s algorithmic stablecoin UST struggles to retain its peg.
US Treasury Secretary, Janet Yellen, said:
New products and technology may present opportunities to promote innovation and increase efficiencies. However, digital assets may present risks to the financial system and increased and coordinated regulatory attention is necessary.
A stablecoin known as TerraUSD experienced a run and declined in value, [which] illustrates that this is a rapidly growing product and there are rapidly growing risks. It would be highly appropriate for stablecoin regulation to occur by the end of 2022 because there are “many risks associated with cryptocurrencies.”
Stablecoins by definition are supposed to be stable and hold their value through a 1:1 ratio that is fixed to an external peg like the U.S. dollar or it can be tied to other assets like UST, which is backed by dollars, but also cryptocurrencies like bitcoin and Avalanche.
“The stablecoin sector continued to grow rapidly and remains exposed to liquidity risks,” the U.S. Federal Reserve said in a report on May 9.
The U.S. Treasury plans to release a report on cryptocurrencies and stablecoins “shortly” and plans to create “highly appropriate” legislation for the pegged asset by the end of 2022, Yellen said.
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, 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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Craig Asano
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