Topic: Fintech

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Basel Committee paper on designing a prudential regime for crypto-assets

On 12 December 2019, the Basel Committee on Banking Supervision (Basel Committee) published a discussion paper seeking views on a range of issues related to the prudential regulatory treatment of crypto-assets. The responses to the discussion paper will inform the Basel Committee’s development of a prudential treatment for crypto-assets at large, including for crypto-assets that … Continue Reading

CPMI report on wholesale digital tokens sets out possible future of transaction settlement

On 12 December 2019, the Committee on Payments and Market Infrastructures (CPMI) published a report on wholesale digital tokens, focussing on their potential for use as a means of settling wholesale transactions. Wholesale transactions are typically settled by updating account balances recorded on a centralised register such as a settlement institution’s ledger. But the development … Continue Reading

FSB publishes reports on financial stability risks stemming from BigTechs and cloud service providers

On 9 December 2019, the Financial Stability Board (FSB) published two reports on financial stability implications of BigTech in finance and third party dependencies in cloud services. The two reports come as BigTech firms – large companies with established technology platforms – play an increasingly prominent role in the financial system and have begun to … Continue Reading

Commission speech on state of play of cryptoassets

On 5 December 2019, the European Commission (Commission) published a speech by Valdis Dombrovskis, European Commissioner for Financial Stability, Financial Services and Capital Markets Union, following the final Economic and Financial Affairs Council (ECOFIN) meeting under the Finnish Presidency. Among other things, ECOFIN announced the endorsement of a joint statement with the Commission on stablecoins … Continue Reading

Crypto Assets: Germany introduces new regulatory regime

Germany has adopted a new regulatory regime for crypto assets in connection with the implementation of the Fifth Anti-Money Laundering Directive (AMLD5). On 29 November 2019, the second chamber of the German parliament (Bundesrat) approved the “Act on the Implementation of the Amendment Directive to the Fourth EU Money Laundering Directive” (Gesetz zur Umsetzung der Änderungs­richt­linie … Continue Reading

Council of EU and European Commission draft joint statement on stablecoins

On 6 November 2019, the Council of the EU released a note (13571/19) from its Presidency addressed to it, which annexes a joint statement of the Council and the European Commission (Commission) on stablecoins. In particular, the joint statement provides that “the Council and the Commission state that no global stablecoin arrangement should begin operation … Continue Reading

IOSCO statement on study of emerging global stablecoin proposals

On 4 November 2019, the International Organization of Securities Commissions (IOSCO) released a statement on a study of stablecoin initiatives with a potential global reach (Global Stablecoins). IOSCO’s FinTech Network (the Network), which is chaired by the FCA and was established in May 2018 to facilitate exchanges among IOSCO members on their experiences relating to … Continue Reading

BIS speech on the future of payments

On 30 October 2019, the Bank for International Settlements published a speech given by Burkhard Baltz, Deutsche Bundesbank Executive Board Member, entitled “Curtain up for the future of payments: from Bigtechs and Fintechs to smartphones”. In his speech, Mr Baltz discusses the three aspects that he believes are key to the digitalisation of the payments … Continue Reading

ESMA validation rules and XML schema for reporting under SFTR

On 31 October 2019, the European Securities and Markets Authority (ESMA) published a press release announcing it has published further technical details for the reporting of Securities Financing Transactions (SFTs) as required under the SFT Regulation (SFTR) The materials include the validation rules applicable to SFTR reports together with the XML schemas that reporting entities … Continue Reading

FSB considers stablecoin regulatory issues

On 18 October 2019, the Financial Stability Board (FSB) published an issues note on the regulatory issues concerning stablecoins. The note was delivered to G20 finance ministers and central bank governors ahead of their meeting in Washington D.C. The FSB warns that recent developments in the private sector involving the launch of stablecoin-type arrangements for … Continue Reading

FSB letter – global resilience in the face of new risks and stablecoins

On 13 October 2019, the Financial Stability Board (FSB) published a letter from Randal Quarles, FSB Chair, to G20 Finance Ministers and Central Bank Governors. The letter highlights three areas of the FSB’s work: ensuring resilience in the face of new risks. The outlook for global growth has started to weaken and become more uncertain. … Continue Reading

BIS publishes working paper on embedded supervision in blockchain finance

On 16 September 2019 the Bank for International Settlements (BIS) published a working paper by its Monetary and Economic Department on Embedded supervision: how to build regulation into blockchain finance. The working paper suggests that asset tokenisation and the use of the underlying distributed ledger technology (DLT) in finance provides new avenues for the supervision … Continue Reading

Commission update on work relating to cryptoassets

On 28 August 2019, the European Commission (the Commission) published an answer given by Valdis Dombrovskis (Vice-President European Commission, Financial Stability, Financial Services and Capital Markets Union) concerning cryptoassets. In its response, the Commission refers to an announcement made in its 2018 Action Plan on FinTech (see previous blog post here) that it is looking … Continue Reading

Joint EBA and ESMA response to the letter of 19 July 2019 on crypto-assets

On 20 August 2019, the European Securities and Markets Authority and the European Banking Authority (together the European Supervisory Authorities) published a letter in response to an earlier letter from Valdis Dombrovskis (Vice-President European Commission, Financial Stability, Financial Services and Capital Markets Union) concerning crypto-assets, including so-called ‘stablecoins’. The letter outlines some of the European … Continue Reading

ECB letter regarding stablecoin initiatives

On 26 July 2019, the European Central Bank (ECB) published a letter from its president, Mario Draghi, to Markus Ferber MEP. In the letter Mr Draghi discusses how the European System of Central Banks (ESCB) is closely monitoring innovation in the financial sector, including stablecoin projects such as Facebook’s ‘Libra’. The ESCB also contributes to … Continue Reading

EBA report on approaches relating to FinTech activities

On 18 July 2019, the European Banking Authority (EBA) published a report illustrating the findings of an analysis on issues relating to access to the market for FinTech firms. The analysis focused on the monitoring of national developments on the regulatory perimeter; the national regulatory status of FinTech firms; and the approaches followed by Member … Continue Reading

ESMA report on the licensing of FinTech business models

On 12 July 2019, the European Securities and Markets Authority (ESMA) published a report on the status of licencing regimes of FinTech firms across the EU. The report is based on two surveys conducted by ESMA since January 2018, which gathered evidence from Member State national competent authorities (NCAs) on the licencing regimes of FinTech … Continue Reading

EBA reveals the four key trends that will affect payment institutions’ and e-money institutions’ business models

The European Banking Association (EBA) has published a report titled “The Impact of Fintech on Payment Institutions’ and E-Money Institutions’ business models” (the Report). The Report acknowledges the significant changes that have taken place in the broader Fintech landscape over the last few years, focussing on the Payment Institution (PI) and E-Money Institution (EMI) space. … Continue Reading

ECB assesses impact of FinTech on payment institutions’ and e-money institutions’ business models

On 8 July 2019, the European Banking Authority (EBA) published a thematic report on the impact of FinTech on payment institutions’ (PIs) and electronic money institutions’ (EMIs) business models. Key points in the report include: the payments landscape in the EU is undergoing significant transformation due to the introduction of the revised Payment Services Directive … Continue Reading

BIS to set up innovation hub for central banks

On 30 June 2019, the Bank for International Settlements (BIS) approved the establishment of an innovation hub to foster international collaboration on innovative financial technology within the central banking community. The role of the hub will be to identify and develop in-depth insights into critical trends in technology affecting central banking: develop public goods in … Continue Reading

FSB report on decentralised financial technologies

On 6 June 2019, the Financial Stability Board (FSB) published a report considering the implications of decentralised financial technologies. The report considers the financial stability, regulatory and governance implications of the use of decentralised financial technologies such as those involving distributed ledgers and online peer-to-peer, or user-matching, platforms. The report focuses on technologies that may … Continue Reading

IOSCO update on 2019 work programme

On 30 May 2019, the International Organisation of Securities Commissions (IOSCO)  issued a press release following its meeting this month in which priority issues facing securities market regulators and supervisors were discussed. The priority issues include: crypto-assets. IOSCO will be publishing a consultation report on crypto-asset trading platforms, in response to a G20 request. IOSCO … Continue Reading

FSB reports on work underway to address crypto-asset risks

On 31 May 2019, the Financial Stability Board (FSB)  published a report on crypto-assets, which considers work underway, regulatory approaches and potential gaps. The report is being delivered to G20 Finance Ministers and Central Bank Governors for their meeting in Fukuoka on 8-9 June. International organisations are working on a number of fronts, directly addressing … Continue Reading

IOSCO consults on key considerations for regulation of crypto-asset exchanges

On 28 May 2019 the International Organization for Securities Commission (IOSCO) published a consultation paper on Issues, Risks and Regulatory Considerations Relating to Crypto-Asset Trading Platforms. Prepared by IOSCO’s Committee 2 on the Regulation of Secondary Markets, the consultation paper seeks stakeholder views in order to help IOSCO members evaluate the issues and risks relating … Continue Reading