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: Fundraising, Investing, Trading
CEO Views on AI in Deals Amid Economic Shifts
AI | Sep 22, 2023
Image: Unsplash/Hunters Race
The world of deal-making is undergoing a significant transformation, driven by technological advancements and shifting economic landscapes.
A CEO's Perspective on the Economy
- The July 2023 EY CEO Outlook survey reveals that US CEOs are gearing up for what might be termed a "new normal" characterized by expensive capital and heightened volatility.
- A striking 97% of US CEOs are preparing for a potential economic downturn in their primary market.
- This cautious approach is not unfounded. The US, while showing signs of a possible "soft landing" due to factors like labor market resilience and moderating inflation, still presents uncertainties. CEOs are not banking on best-case scenarios but are instead fortifying their organizations for sustainable growth.
AI in Deal-Making - A Game Changer
- AI's role in this evolving landscape is undeniable. A significant 80% of US CEOs have either already integrated AI into their products and services or plan to do so within the next year. However, the application and benefits of AI vary.
See: Birth of the First AI-Generated Memecoin, AstroPepeX (APX)
- AI and ML have the potential to revolutionize the merger and acquisition process. They can make the due diligence process more efficient by analyzing vast amounts of data quickly. Tools like Robotic Process Automation (RPA) can automate data analysis, and AI tools offer predictive modelling capabilities.
- Interestingly, when asked about the use of AI in the transaction diligence process, 30% of US CEOs confirmed its application. However, a larger percentage (37%) are still in the initial stages. The emphasis seems to be on traditional business strategy principles, with a focus on value, capital structure, and corporate strategy.
- A recent Business Insider article shed light on the evolving role of junior bankers. Gone are the days of mundane tasks and grueling hours. With AI's intervention, junior bankers can now focus on critical thinking and strategy, as repetitive tasks become automated. Financial giants like Deutsche Bank are already harnessing the power of generative AI, enabling junior bankers to work more efficiently and focus on building analytical skills.
- But it's not just about automating tasks.
- Generative AI is revolutionizing strategic planning, financial reporting, and stakeholder engagement. It's fostering a more agile and responsive financial environment, allowing leaders to break free from traditional constraints.
- For fundraisers and deal-makers, this AI-driven transformation means:
- Faster decision-making, accurate market trend analysis, and enhanced stakeholder communication.
- The integration of AI tools can also lead to more personalized investor pitches, efficient document processing, and real-time risk assessment.
See: The AI Revolution in Wealth Management: Top 3 Innovations (and more)
- Concerns still need to be addressed properly:
- With AI processing large amounts of data, there are concerns about data breaches and privacy.
- While AI is valuable, it cannot replace human intuition and understanding.
- Heavy reliance on AI might lead to overlooking compliance requirements -> lack of governance.
- AI as an Investment: Implementing AI requires significant investment in technology and possibly personnel.
Into the Future
In an era marked by rapid technological evolution and economic unpredictability, CEOs are at the forefront of navigating uncharted waters.
While the tools of tomorrow promise efficiency and innovation, the human element remains irreplaceable. The fusion of AI's capabilities with human insight will undoubtedly chart the future of deal-making, setting the stage for a more agile, informed, and strategic financial world.
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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Solid World, KlimaDAO, and SCB Group Unite for a Sustainable Future
Carbon Markets | Sep 21, 2023
Solid World, KlimaDAO, and SCB Group announce partnership to deploy prepaid carbon liquidity using blockchain technology, enhancing efficiency and transparency in the carbon market.
With global climate challenges on the rise, there's a pressing demand for clear, efficient, and adaptable carbon market strategies. The new alliance between KlimaDAO, SCB Group, and Solid World highlights the next phase in carbon market dynamics, shedding light on the potential impact and direction of this collaboration.
- KlimaDAO is at the forefront of blockchain-based carbon credit solutions, dedicated to fostering a sustainable future. With a vision to revolutionize the carbon market, KlimaDAO provides cutting-edge market infrastructure, ensuring transparency and efficiency in carbon trading.
- Solid World (an NCFA Industry Partner) offers innovative infrastructure solutions pioneering the next generation of carbon market platforms. Solid World's infrastructure stands out for its ability to create a liquid market for prepaid carbon credits that are yet to be issued. This is a game-changer for the Voluntary Carbon Markets, offering predictability of funding and reducing payback times for project developers. The introduction of the CRISP framework further augments the confidence in such projects. The new prepaid credit pool has launched with 54,050 tonnes of carbon and over $1M in total liquidity.
FFCON23 Solid World Presentation: Harnessing the Power of DeFi to Tackle Climate Change: A New Era of Sustainable Finance
- SCB Group is a global leader in the carbon market and committed to driving positive change through sustainable projects. With a deep-rooted belief in the power of distributed ledger technology, SCB Group collaborates with partners like Solid World and KlimaDAO to nurture a more sustainable world and advance the collective goal of a low-carbon future.
Gold Standard Certified Projects
- One of the highlights of this partnership is the sourcing of prepaid credits from The Gold Standard certified project. Such projects not only ensure the provision of high-quality carbon credits but also contribute to sustainable development goals.
- The focus on providing Improved Cookstoves for Rohingya Refugees in Bangladesh is a prime example of combining humanitarian efforts with environmental conservation.
Shared Vision
- Andrew Bonneau of KlimaDAO expressed enthusiasm about the collaboration, highlighting the shared vision of all three entities. They aim to harness technology to foster a dynamic, innovative, and scalable climate finance market.
- Stenver Jerkku, CEO of Solid World, emphasized the goal of bringing clarity and transparency to carbon markets, envisioning a future where clear commodity prices catalyze significant change.
See: Solid World Unveils CRISP: Risk Assessment Framework and Tool For Carbon Forwards
- Kevin McGeeney, CEO of SCB Group, shared his personal experience visiting the refugee camps in Bangladesh, witnessing the positive impact of improved cookstoves on the Rohingya community. He believes in the potential of distributed ledger technology to support the Voluntary Carbon Market and envisions a sustainable world.
Looking Forward
The partnership between KlimaDAO, SCB Group, and Solid World is more than just a business collaboration. It represents a confluence of technology, sustainability, and humanitarian efforts. As the carbon market continues to evolve, such partnerships will play a crucial role in shaping its future, ensuring that it remains robust, transparent, and aligned with the global goal of combating climate change.
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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Bitbuy and Localcoin Partner Boosting Crypto Access in Canada
Crypto | Sep 20, 2023
Image: Unsplash/Vardan Papikyan
Bitbuy, a subsidiary of WonderFi Technologies Inc., has announced a strategic partnership with Localcoin, Canada's largest Bitcoin ATM provider.
This collaboration aims to enhance cryptocurrency adoption and accessibility across Canada.
Expanding Access to Crypto
- Localcoin, established in 2017, has been a pioneer in the cryptocurrency ATM sector in Canada. With 920 ATMs, it captures 33% of the cryptocurrency ATM market share in the country. Localcoin chose Bitbuy for its scale, commitment to the Canadian market, and robust regulatory positioning.
- Bitbuy's digital asset services will soon power nearly 50% of Canada's Bitcoin ATMs. This is a testament to the scale and reach of the partnership.
See: Bitbuy to Offer Stock Trading to Its Users
- Bitbuy is on track to surpass 900,000 registered Canadian users by the end of the month, making it one of the country's largest crypto-trading platforms. The platform caters to a diverse user base, including retail and advanced traders, high-net-worth individuals, and institutional clients. This partnership solidifies both companies' positions as leaders in the Canadian cryptocurrency space.
- This collaboration ensures that Canadians have more touchpoints to access cryptocurrencies, making it easier for both novices and experts to buy or sell digital assets.
Improving User Experience and Security
- The partnership will introduce a robust API integration, ensuring a seamless connection between Bitbuy and Localcoin platforms.
- This integration will provide Localcoin users with competitive pricing and efficient order execution, enhancing the overall user experience.
- Both companies are committed to upholding the highest standards of security in the cryptocurrency industry, ensuring that users' transactions and assets are safeguarded.
See: Dispelling FUD: Why Binance’s Exit from Canadian Crypto Markets Strengthens Canada’s Ecosystem
Another Milestone for Canadian Crypto
In conclusion, the strategic partnership between Bitbuy and Localcoin marks a significant milestone in the Canadian cryptocurrency landscape. As fintechs, financial institutions, and investors navigate the evolving digital asset ecosystem, collaborations like these signal a promising future for cryptocurrency adoption and infrastructure development in Canada.
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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Hut 8 Mining’s Merger with USBTC Gets BC Supreme Court Nod
M&A | Sep 19, 2023
Image: Unsplash/Kanchanara
Hut 8 Mining has received the final nod from the Supreme Court of British Columbia to merge with U.S. Data Mining Group, known as US Bitcoin Corp.
This strategic move aims to bolster their position in the North American market, combining both bitcoin and fiat revenues. The merger is expected to enhance their operational capacity and expand their presence in the stock market.
Final Approval for Merger
- Hut 8 Mining has secured the final court approval from the Supreme Court of British Columbia to complete its merger with U.S. Data Mining Group, which operates under the name US Bitcoin Corp. This merger had been in the works since February 2023 and was contingent on both shareholder and regulatory approvals.
See: Proposed Changes to Crypto Mining GST/HST Rules: What’s Capture and What’s Not?
Strategic Positioning
- The merger is an all-stock merger of equals and is anticipated to create a robust business entity in North America, backed by both bitcoin and fiat revenues. The combined entity, named Hut 8 Corporation or "New Hut," will be publicly traded in the United States. This move is expected to significantly enhance their operational capacity, with access to 825 megawatts across six Bitcoin mining and data center facilities.
Future Plans and Challenges
- New Hut has plans to list its shares on major stock exchanges, including the Nasdaq and Toronto stock exchanges, under the ticker "HUT." However, Hut 8 has faced challenges, including relocating mining rigs from Ontario to Texas and dealing with a legal dispute with Validus Power. Despite these challenges, partnerships like the one with Foundry Digital in August 2023 indicate a positive trajectory for the company.
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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New York’s DFS Remove Ripple and Dogecoin from Greenlist
Crypto Regulation | Sep 19, 2023
Image: Unsplash/Shubham Dhage
The New York Department of Financial Services (DFS) has revamped its crypto oversight, notably removing Ripple, Dogecoin, and Litecoin from its approved "greenlist."
While DFS continues to lead in digital asset supervision, the crypto world is witnessing varied regulatory approaches globally. From Solana Labs emphasizing robust U.S. regulations to Hong Kong's potential tightening after the JPEX probe, 2023 is shaping up to be a landmark year for crypto governance and regulation.
What recent changes did the New York Department of Financial Services (DFS) announce regarding its virtual currency oversight?
- Yesterday, the New York Department of Financial Services (DFS) revealed an update to its virtual currency oversight regime. This update introduced new criteria for how digital firms licensed by the agency can list different cryptocurrencies.
- As a significant part of this overhaul, DFS removed over two dozen tokens from its “greenlist” of approved tokens. Notably, Ripple, Dogecoin, and Litecoin were among those removed. However, eight tokens, including Bitcoin, Ether, and the new PayPal Dollar, remain on the list.
See: Decoding Judge Rakoff’s Opinion: What It Means for Future Crypto Regulations
How has DFS positioned itself in the crypto regulation landscape?
- DFS has emerged as a nation-leading digital asset supervisor, primarily due to its BitLicense program and virtual currency unit.
- While the crypto industry often criticizes DFS for its rigorous licensing process, the recent guidance showcases DFS's balanced approach to crypto regulation. This is in contrast to other state and federal agencies that lean more towards enforcement actions.
What was the purpose of the DFS greenlist, and how has it changed?
- The DFS greenlist was created as an integral part of its broader crypto supervision. Previously, firms licensed by DFS could gain approval to custody and list tokens through a self-certification system. This system streamlined the process while still granting DFS a supervisory role.
- Once two firms had self-certified a token for either custody or listing, it would be added to the DFS greenlist.
- This meant that any DFS-licensed firm could approve the token for custody or listing, further speeding up the process. However, with the new guidance, the greenlist has been significantly reduced, now featuring only eight tokens.
How does the international crypto regulation landscape look in 2023?
- Internationally, the crypto regulation landscape is evolving rapidly. For instance, Anatoly Yakovenko, co-founder of Solana Labs, has emphasized the importance of comprehensive cryptocurrency regulations in the United States to maintain its leadership in the blockchain and Web3 sectors.
- Also, Hong Kong, a significant player in the crypto world, is considering tightening its crypto regulations. This comes in the wake of an investigation into the crypto exchange JPEX, which led to six arrests and numerous reports of financial losses.
Crypto regulations in the future
As the crypto industry continues to grow and evolve, regulatory bodies worldwide will likely introduce more stringent and detailed guidelines to protect investors and ensure market stability.
See: New U.S. Crypto Accounting Rules Come Into Effect in 2024
The recent actions by DFS and other global entities highlight the importance of a balanced approach to regulation, ensuring innovation while safeguarding investor interests.
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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Morgan Stanley is Launching a Wealth Management AI Chatbot
AI | Sep 18, 2023
Image: Unsplash/Possessed Photography
Morgan Stanley, a leading name in investment banking and wealth management, is set to redefine the financial advisory landscape with its latest AI innovation, an AI-powered Morgan Stanley Assistant
Collaborating with OpenAI, the bank has developed a generative AI chatbot, aiming to enhance the experience for its wealthy clientele and streamline operations for its financial advisors.
The AI chatbot, named the "AI @ Morgan Stanley Assistant," is designed to provide financial advisors with rapid access to a vast database containing approximately 100,000 research reports and documents. This initiative is part of Morgan Stanley's broader strategy to bolster its wealth division, which has recently witnessed a 16% surge in net revenue.
One of the unique features of this chatbot is its ability to understand and respond to full-sentence queries, mimicking human-like interactions. Advisors are encouraged to communicate with the chatbot as they would with a human assistant, moving away from the traditional keyword-based search approach.
See: Considerations for Building the Next Fintech x AI Opportunity
Morgan Stanley envisions the chatbot to do more than just fetch documents. With client consent, the AI could potentially:
- Generate summaries of meetings;
- Draft follow-up emails;
- Update the bank's sales database; and
- Schedule subsequent appointments.
- (Note, the bank is also piloting a tool named "Debrief" that can automatically summarize client meetings and generate follow-up emails.)
While other financial giants like Goldman Sachs and JPMorgan Chase are exploring generative AI technology, Morgan Stanley stands out as the first major Wall Street firm to deploy a solution based on OpenAI's GPT-4 for its employees.
Will Investors and Advisors Use It?
Given the potential benefits, it's highly likely that both investors and advisors will embrace this AI innovation. For investors, the chatbot promises a more streamlined and efficient interaction with their financial advisors. On the other hand, advisors stand to benefit from the enhanced operational efficiency, allowing them to focus more on client interactions and less on administrative tasks.
See: Human vs Machine’s Tug-of-War: Stockmarket Automation Lessons
However, the success of this AI initiative will hinge on its accuracy, reliability, and the value it brings to both investors and advisors. As with any new technology, there will be a learning curve, and the real test will be its adoption rate among Morgan Stanley's clientele and advisory team.
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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MGM Resorts Faces Major Ransomware Attack in Las Vegas
Cybersecurity | Sep 18, 2023
Image: Unsplash/David Vives
MGM Resorts fell victim to a debilitating ransomware attack. The impact was widespread, affecting several of its properties, notably the iconic MGM Grand and Bellagio casinos in Las Vegas.
The recent cybersecurity breach at MGM Resorts has sent shockwaves throughout the industry, raising concerns about the vulnerability of even the most fortified systems.
The Incident and Perpetrators
- MGM Resorts, one of the largest casino owners in Las Vegas, fell victim to a significant cybersecurity attack. The first signs of the attack emerged on a Sunday evening, with guests experiencing difficulties accessing their rooms due to disabled mobile apps and digital key cards. The ramifications extended to ATMs, cashier offices, parking systems, and even slot machines.
- While the recovery process has been arduous, with MGM's digital platforms still facing issues days after the attack, the perpetrators remain a topic of debate. A group named ALPHV has claimed responsibility, citing a targeted approach via LinkedIn. However, another faction, Scattered Spiders, is also under suspicion.
- Videos circulated on social media showed video slot machines that had gone dark, and some customers reported that their hotel room cards weren't functioning. By the following Friday, booking capabilities were still down, with MGM Resorts offering penalty-free room cancellations through September 17th.
See: Small Businesses Incur Greatest Loss of Cyber Attacks | 67% Suffer Repeat Attacks Within 12 Months
- Among the affected was FTC Chairwoman Lina Khan, who, along with about 45 other guests, had to manually write down their credit card information when checking into the MGM Grand Hotel due to the reservation system's shutdown. This incident raised concerns about the protection of consumer data, especially when such high-profile individuals are involved.
Implications and Response
- The MGM breach wasn't an isolated incident. By the following Thursday, Caesars Entertainment, the world's largest casino owner, confirmed it too had been hit by a cybersecurity attack.
- While MGM Resorts' systems were still down, Caesars reported that its casino and hotel computer operations weren't disrupted. However, the company couldn't confirm the security of personal information of its vast customer base following the data breach. This series of attacks has shattered the public perception that casino security is impenetrable, requiring an "Oceans 11"-level effort to defeat.
- The financial impact can be calculated based on lost revenue and increased costs - one report calculates approximately $650k lost per hour.
- The nature and scope of the attack might indicate significant issues in the company's control system. Concerns include how so many systems were vulnerable to a single attack, potential failures in authentication procedures, and the inadequacy of backup systems and business continuity plans.
- The MGM incident has sparked discussions on the materiality of such breaches. From a quantitative standpoint, businesses need to evaluate the financial repercussions, considering lost revenues and additional costs. On the qualitative front, the nature and extent of the attack can indicate significant systemic issues that stakeholders should be made aware of.
- While the Securities and Exchange Commission's (SEC) new rules on cybersecurity attack disclosures were not applicable to this incident, they are set to be enforced by year-end, making this event all the more significant.
Lessons for the Future
The recent cyberattacks on MGM Resorts and Caesars Entertainment highlight the evolving challenges in the realm of cybersecurity. As technology continues to advance, so do the tactics and strategies of cybercriminals. The hospitality industry, with its vast troves of personal and financial data, remains a prime target. It's imperative for businesses to continually update and fortify their cybersecurity measures, ensuring the safety and trust of their patrons.
See: Zurich CEO: Cyber Attacks May Become ‘Uninsurable’
- The interconnectedness of modern systems and the risks associated with a single point of failure.
- The importance of stringent authentication procedures to prevent social engineering attacks.
- The critical role of backup systems and business continuity plans in ensuring operational resilience.
The incident emphasizes the need for businesses to adopt a proactive approach to cybersecurity, continually evaluating and updating their measures in line with evolving threats.
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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