Saturday, 27 August 2016

The Corda Non-Technical Whitepaper — R3

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I’m pleased to announce the release of our first whitepaper on Corda: an introductory, non-technical overview that explains our vision, some design choices and outlines the key concepts underpinning the platform. 

From The Corda Non-Technical Whitepaper — R3

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Friday, 26 August 2016

Barclays slated after CIO takes a year to open a bank account

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The rigorous KYC procedures at US banks

the New Jersey-based crime ring created more than 7,000 fake identities to get tens of thousands of credit cards

From Woman Gets 3 Years for Role in $200M Credit Card Fraud Scam - ABC News

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Barclays slated after CIO takes a year to open a bank account

: "An adviser to a new charitable incorporated organisation that spent more than a year trying to open a bank account has blasted Barclays for its onerous demands and disproportionate due diligence."

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In a recent survey for VocaLink, some two-thirds of respondents said that they saw value in the establishment of a central KYC utility. They are wrong. We don’t need a central KYC utility, we need a federated reputation infrastructure. Or, to put it another way, a financial services passport (as I mentioned earlier in the year).

Thursday, 25 August 2016

America’s Biggest Banks Have a New Name for Their Venmo-Killer: Zelle - WSJ

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U.S. banks want their customers to “zelle” each other.

From America’s Biggest Banks Have a New Name for Their Venmo-Killer: Zelle - WSJ

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Deutsche boss: negative interest rates are 'fatal'

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Deutsche Bank's chief executive has warned of the "fatal consequences" of the European Central Bank's negative interest rate policy, which he said punished savers and could even undermine the recovery.

From Deutsche boss: negative interest rates are 'fatal'

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According to McKinsey (2016), global payment revenues are around $1.7 trillion (and will be $2 trillion by 2020). Payments are around 40% of global bank revenues. 

Wednesday, 24 August 2016

R3 Consortium Files Patent Application For Concord Platform – The Merkle

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There is an argument to be made as to how blockchain-based solutions should not have patents attached to them

From R3 Consortium Files Patent Application For Concord Platform – The Merkle

Just as well it’s not a blockchain then.

Monday, 22 August 2016

Sunday, 21 August 2016

Fingerprints to be tested as ‘currency’ - The Japan News

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Starting this summer, the government will test a system in which foreign tourists will be able to verify their identities and buy things at stores using only their fingerprints.

The government hopes to increase the number of foreign tourists by using the system to prevent crime and relieve users from the necessity of carrying cash or credit cards. It aims to realize the system by the 2020 Tokyo Olympic and Paralympic Games.

The experiment will have inbound tourists register their fingerprints and other data, such as credit card information, at airports and elsewhere.

Tourists would then be able to conduct tax exemption procedures and make purchases after verifying their identities by placing two fingers on special devices installed at stores.

The Inns and Hotels Law requires foreign tourists to show their passports when they check into ryokan inns or hotels.

[From Fingerprints to be tested as ‘currency’ - The Japan News]

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Saturday, 20 August 2016

How useful is it to formalize land titles? - Marginal REVOLUTION

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“When property rights are transferred to very poor people, preserving legal tenure will likely entail onerous expenses in the form of attorney and public notary fees, and courts costs. In addition, these charges are higher in relative terms in very unequal societies where the gap between the poor and the relatively well-off is wider.”

From How useful is it to formalize land titles? - Marginal REVOLUTION

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Singapore makes cashless payments push

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According to research from the Monetary Authority of Singapore and KPMG, the social costs of this heavy reliance on cash and cheques is around 0.5% of GDP, or S$2 billion a year.

From Singapore makes cashless payments push

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Friday, 19 August 2016

KCB-MPesa loans hit over Sh25 million daily | The Star, Kenya

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Kenyans are borrowing between 25 and 30 million daily through the mobile-based KCB-Mpesa credit line, Safaricom and Kenya Commercial Bank have said.

The two firms, which jointly operate the savings and micro-credit platform, said the total loans advanced so far since the launch of the service in March 2015 was Sh10.3 billion.

Total savings currently held in the 6.4 million KCB-M-Pesa accounts have reached Sh286.1 million.

From KCB-MPesa loans hit over Sh25 million daily | The Star, Kenya

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Thursday, 18 August 2016

Wednesday, 17 August 2016

A split euro is the solution for Europe’s single currency - FT.com

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It was almost inevitable that taking away two key adjustment mechanisms, the interest and exchange rates, without putting anything else in their place, would make macro adjustment difficult.

From A split euro is the solution for Europe’s single currency - FT.com

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It is important that there can be a smooth transition out of the euro, with an amicable divorce, possibly moving to a “flexible-euro” system, with say a strong Northern Euro and softer southern euro

From A split euro is the solution for Europe’s single currency - FT.com

Who am I to argue with a Nobel prize-winning economist and former chief economist of the World Bank? So let’s take it as read that he right about this. I say let’s do: create the Northern Euro (the Anglo) and the Southern Euro (the Latino) as hard e-currencies. There’s no need to ever bother minting coins or printing banknotes.

But one thing that immediately springs to mind is: why stop there? Stieglitz talks about the digital economy enabled by modern technology, about “electronic trade tokens”. 

Bitcoin Smart Contract ‘Federation’ to Launch With 25 Startups - CoinDesk

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Announced today, a group of international bitcoin companies have signed a letter of intent to form a federation that would find them supporting and contributing to the development of a smart contracts platform that would utilize the bitcoin blockchain.

Unveiled today, the RSK Federation is built around the RSK smart contract network created by Buenos Aires-based startup Rootstock.

From Bitcoin Smart Contract ‘Federation’ to Launch With 25 Startups - CoinDesk

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Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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Commissioner Chris Giancarlo of the Commodity Futures Trading Commission said he doesn't personally have a view on the open or closed evolution of blockchain. As a regulating body, the CFTC would seek to be a participant on the blockchain with a node that would allow it to see all transactions whether they're closed or open.

From Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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Symbiont, a developer of software for self-executing smart contracts, takes pretty much the opposite approach.

"We've been utilizing very sophisticated cryptographic techniques to execute on our thesis that everything — and I mean everything — must be on ledger," said Mark Smith, Symbiont's chief executive.

From Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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"No private contractual data should be stored on a distributed ledger, encrypted or otherwise," Masters said by email.

From Banks' Privacy Concerns Shaping Blockchain Vendors' Strategies | American Banker

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The Economist explains: Why some economists want to get rid of cash | The Economist

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The anonymity problem can in part be solved by retaining smaller notes and coins; enough for punters to keep buying porn, weed and birthday presents, but not so much as to buy property. The point about financial exclusion is trickier. In a near-cashless world vulnerable groups, such as the poor, the elderly and migrants, could become further marginalised, and those who are especially cash-dependent for income, such as churches, charities and the homeless, could expect to see a drop in their incomes.

From The Economist explains: Why some economists want to get rid of cash | The Economist

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FCA seeks to use ‘regtech’ to lessen reporting burden - FTAdviser.com

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“Today’s AML regime was mainly developed in the 1990s, and while it does recognise digital identity, the way that many firms have put it into practice can make it feel paper-based,” admitted [FCA Director of Strategy and Competition] Mr Woolard.

From FCA seeks to use ‘regtech’ to lessen reporting burden - FTAdviser.com

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Standard Bank scam: R300-million ATM heist ups the ante | Business | Africa (Business) | M&G

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arly on a sunlit summer’s morning in Japan, with the last cherry blossoms fading and the wisteria in bloom, more than 100 fraudsters strolled into convenience stores all around the country.

With fake credit cards cloned from the information of 1 600 South Africa Standard Bank customers, they made 14 000 transactions, drawing in total the equivalent of R300-million in Japanese yen from 1 400 ATMs in just three hours, between 5.00am and 8.00am local time.

The authorities, the bank and its customers in South Africa, still asleep, were none the wiser. The thieves had probably already skipped the country with the small fortune in yen, the most tradable currency in the world after the US dollar.

It was only a week later that a Japanese paper, Mainichi, reported on the theft, citing investigative sources. On Monday, Standard Bank confirmed it had been the victim of a sophisticated, co-ordinated fraud.

The bank said it had incurred a total R300-million loss,

From Standard Bank scam: R300-million ATM heist ups the ante | Business | Africa (Business) | M&G

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Tuesday, 16 August 2016

Comic Con Controversy Highlights Digital ID Opportunity for Banks | American Banker

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o discourage ticket scalping, event organizers ReedPOP required fans to authenticate themselves online before ticket sales began. Would-be buyers were asked to put down a number of credentials — including phone numbers, addresses, and credit card information — in what was dubbed the "fan verification process."

From Comic Con Controversy Highlights Digital ID Opportunity for Banks | American Banker

This is precisely the sort of nonsense that perpetuates in the absence of a working digital infrastructure.

Beam Wallet and MasterCard team up to offer an innovative and rewarding mobile payment experience in the UAE | Global Hub

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In order to engage with our customers, ENOC in partnership with Beam, has rolled out Bluetooth Low Energy (BLE) beacons at our service stations to enable payment for fuel and convenience store transactions, allowing consumers to pay through their mobile phones,”

From Beam Wallet and MasterCard team up to offer an innovative and rewarding mobile payment experience in the UAE | Global Hub

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Monday, 15 August 2016

Digital Identity: I'm sure banks have a strategy for this kind of thing

This is what I said about it back in 2008.

Some time ago, I pointed out that sensible retailers would use ID cards to cut payment schemes out of the transaction loop, by using ID cards as payment tokens and using the ACH network rather than Visa or MasterCard

From Digital Identity: I'm sure banks have a strategy for this kind of thing

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The 'right to record' is not a question of technology, but rather power and policy - TechRepublic

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There's now some evidence that police cameras reduce complaints and violence, which has led to editorial boards calling for more cameras on officers and some civil libertarians calling for every officer to wear a lapel cam while on duty.

From The 'right to record' is not a question of technology, but rather power and policy - TechRepublic

Note, however, that 

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Surprisingly, we found that the use of wearable video cameras is associated with a 3.64% increase in shooting-deaths of civilians by the police. We explain that video recordings collected during a violent encounter with a civilian can be used in favor of a police officer as evidence that justifies the shooting.

From Study Links Police Bodycams to Increase in Shooting Deaths - Law Blog - WSJ

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The paper also looked at the use of smartphones and in-vehicle laptops that allow police officers to obtain crime data and suspect information on the fly. In contrast to their findings on body cameras, “smartphone use by officers is also associated with a 2.46% reduction in the shooting-deaths of civilians,” the study said.

From Study Links Police Bodycams to Increase in Shooting Deaths - Law Blog - WSJ

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The Drumbeat for Open APIs Is Getting Louder | American Banker

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Wells' tiptoeing into open APIs by offering them to commercial customers is typical of banks, which see such clients as the test case. Consumer applications hold the greater opportunity, but also carry more risk given cybersecurity and data issues.

From The Drumbeat for Open APIs Is Getting Louder | American Banker

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Era of plastic credit card to end soon

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Hendrik Kleinsmiede, the director of Visa Europe’s innovation arm Collab, which is backing Sthaler, said the Fingopay technology was less immune to problems such as wet and dusty fingers or fraud. “People are ready to accept biometrics as a secure authentication mechanism,” he said.

From Era of plastic credit card to end soon

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Machine Vision’s Achilles’ Heel Revealed by Google Brain Researchers

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It turns out machine vision algorithms have an Achilles’ heel that allows them to be tricked by images modified in ways that would be trivial for a human to spot. These modified pictures are called adversarial images, and they are a significant threat.

From Machine Vision’s Achilles’ Heel Revealed by Google Brain Researchers

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CVS follows Walmart with own mobile payments service - BayPay Members Blogs

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Integrated into the company's main app, CVS Pay lets customers combine payment, prescription pickup and loyalty programme access all in one quick scan at checkout.

From CVS follows Walmart with own mobile payments service - BayPay Members Blogs

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Sunday, 14 August 2016

Funny story, this. UK.gov's 'open banking app revolution'. Security experts not a fan of it • The Register

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The new rules from the Competition and Markets Authority are designed to promote transparency and clarity while providing an incentive for customers to switch providers. The model is taken from the UK's deregulated electricity industry.

Security experts, however, remain concerned over the potential of greater risk to customer data inherent in the new approach.

From Funny story, this. UK.gov's 'open banking app revolution'. Security experts not a fan of it • The Register

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Call Blockchain Developers What They Are: Fiduciaries | Bank Think

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The default position in tort law is that it is very difficult to hold software developers liable for the harms their software wreaks. Software licenses — the terms on which people use software — generally disclaim all liability for problems the software causes. In keeping with the tech mantra that it's always better to ask forgiveness than permission, these powerful shields encourage coders to experiment.

This lax liability standard may work when we are talking about sharing music or creating cat videos. It doesn't work so well with money, finance, contracts, property records, medical records, proof of identity

From Call Blockchain Developers What They Are: Fiduciaries | Bank Think

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Dailytimes | German bank starts charging customers in negative interest rate

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From September, for savings in excess of 100,000 euros (US$111,710), the community's Raiffeisen bank will take back 0.4 per cent.

From Dailytimes | German bank starts charging customers in negative interest rate

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POST Biometrics could be the nail in the plastic card's coffin

The combination o

FingoPay is cutting out the middlemen (the bank cards, the smartphones and smartwatches), to let you pay with – you guessed it – your finger.

From FingoPay: Move over Apple Pay, 'Blood Pay' is here

The use vein-scanning as the non-contact biometric.

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I also told [the BBC], in the spirit of openness and integrity that is associated with the good name of Consult Hyperion throughout the civilised world, that we had been retained by Hitachi some years ago to carry out a study on the security of this product and its suitability for certain financial services applications.

From We'll be giving Barclays the finger next year | Consult Hyperion

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Biometrics continue to advance in Japan with the news that Hitachi is teaming with Japanese issuer JCB to develop a biometric payment system based on its finger vein authentication technology that can be used as an alternative to cards and cash at the point of sale.

From Fingering suspects | Consult Hyperion

As you will see in this piece, I was sceptical about biometric identification at retail POS because back then the use of biometric authentication against a revocable token seemed like a much better solution to me.

2009

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So, a plausible idea for son-of-chip-and-PIN, taking on board Max’s idea and merging it with our experiences gained implementing and doing security risk analysis for EMV schemes in a number of countries, might be as follows:

For micropayment, cash-replacement transactions: just wave the token (well, let’s say it, the mobile phone); For mesopayment, card-replacement transactions: enter the PIN, preferably into the mobile phone not the terminal, then wave the phone over the terminal; For megapayment, EFT-replacement transactions: enter the PIN, put the phone on the terminal and then put your finger in a vein scanner (such as the Hitachi system used in Japan).

This is a practical solution to the mass market use of biometrics, and you can make it work online as well by using challenge/response voice biometrics instead of vein scanning.

From The long and short of it | Consult Hyperion

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Festival - put token on file for four days - use fingerprint - have it all deleted at the end

On Fungibility, Bitcoin, Monero and why ZCash is a bad idea. – We Use Cash

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But what if law enforcement goes to the biggest miners in the world (representing at least 51% of the hashpower) and tells them that if they continue to confirm easily identifiable mixing transactions, they will be accused of money laundering.

From On Fungibility, Bitcoin, Monero and why ZCash is a bad idea. – We Use Cash

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Levvel Blog - clearXchange Finds New Allies in the Quest For Ubiquity

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For sending banks, the bank processes the CXC transactions as they normally do: look up the receiver, run limit checks, apply fraud controls, and initiate the transaction. However, instead of settling via ACH to the end recipient’s DDA, the bank sends the payment transaction to CXC, which originates the Visa/MC original credit transaction (OCT) on behalf of the sending bank to credit the receivers debit card. Once CXC performs the OCT, it updates the sending bank, which will see its transactions in its normal debit network settlement files.

From Levvel Blog - clearXchange Finds New Allies in the Quest For Ubiquity

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Cashless payments: How one city has made electronic transactions pay off | ZDNet

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Angeloni believes so. "Proof is that in the final two months of last year, when personal incentives were no longer available, cashless payments continued to grow," he says.

From Cashless payments: How one city has made electronic transactions pay off | ZDNet

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Cashless payments: How one city has made electronic transactions pay off | ZDNet

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There are several reasons for this gap: one is that Italy has a record number of 'unbanked' citizens. In other words, 15 million Italians do not have a bank account. Behind this statistic lies a wariness about financial monitoring because of privacy concerns and because of widespread tax avoidance. Read this Inside the pay-by-tweet service that's poised to shake up France's payments market

Inside the pay-by-tweet service that's poised to shake up France's payments market

A subsidiary of France's second biggest banking group has introduced a novel money transfer service tied to Twitter.

Read More

It's not easy to overcome those obstacles. But a local administration in Italy is doing its best to swim against the tide. The northern city of Bergamo in Lombardy has succeeded in recording a 10 per cent increase over seven months in the number of electronic payments made by residents,

From Cashless payments: How one city has made electronic transactions pay off | ZDNet

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Friday, 12 August 2016

Under Pressure, Big Banks Vie for Instant Payment Market - The New York Times

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Instant person-to-person payment is something that people in many other countries have been able to do for years, and the absence of the service in the United States has been a marker of the relative backwardness of American banks.

From Under Pressure, Big Banks Vie for Instant Payment Market - The New York Times

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Thursday, 11 August 2016

Tim Berners-Lee and Solid Want to Protect Your Data | Digital Trends

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Berners-Lee’s new project, underway at his MIT lab, is called Solid (“social linked data”), a way for you to own your own data while making it available to the applications that you want to be able to use it.

With Solid, you store your data in “pods” (personal online data stores) that are hosted wherever you would like. But Solid isn’t just a storage system: It lets other applications ask for data. If Solid authenticates the apps and — importantly — if you’ve given permission for them to access that data, Solid delivers it.

From Tim Berners-Lee and Solid Want to Protect Your Data | Digital Trends

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Communist Manifesto (Chapter 1)

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The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It has pitilessly torn asunder the motley feudal ties that bound man to his “natural superiors”, and has left remaining no other nexus between man and man than naked self-interest, than callous “cash payment”.

From Communist Manifesto (Chapter 1)

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France’s BPCE to buy fintech Fidor Bank — FT.com

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Fidor is one of the best-known names in the German fintech scene. Founded by Matthias Kröner in 2009, it has built a network of 350,000 people in the UK and Germany who are rewarded for providing each other with financial advice

From France’s BPCE to buy fintech Fidor Bank — FT.com

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Apps open up in South Korea for personal finance » Banking Technology

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he South Korean government is launching an open platform designed to let firms develop and test apps for personal finance management.

According to Korea Joongang Daily, the platform will be available at the end of this month. The Financial Services Commission in South Korea announced today (10 August) that 16 banks and 25 brokerage firms are taking part in the joint open platform, which includes an open API and a test bed.

“Once the open platform is completed, fintech companies will no longer have to sign contracts with different financial companies,” says Yim Jong-yong, Financial Services Commission chairman.

From Apps open up in South Korea for personal finance » Banking Technology

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Wednesday, 10 August 2016

Funny story, this. UK.gov's 'open banking app revolution'. Security experts not a fan of it • The Register

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APIs (application protocol interfaces), which are a major cornerstone of the CMA's plan for banks to share consumer data, can also provide an easy route for attackers if not properly secure.

From Funny story, this. UK.gov's 'open banking app revolution'. Security experts not a fan of it • The Register

Well, true dat. But since neither the APIs, nor the security architecture, nor the practices, procedures and audit mechanism have been defined, it is simply impossible to say whether the UK OBWG implementation is secure or not.

One-Time Card Numbers for an Era of Endless Breaches | American Banker

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Token's app generates a 16-digit number a customer can use online the same way she would a card number. It can also generate a fake yet usable cardholder name. The merchant and bank go through a cardlike authorization process; token works with both Visa and Mastercard.

From One-Time Card Numbers for an Era of Endless Breaches | American Banker

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POST The good doctor

I think we all understand that the identity infrastructure that we have now is not suited for the connected world that it was never designed for.

On the one hand, the problem seems obvious. We all need some kind of consistent digital identity (think virtual ID "card") that can identify and authenticate us not only to all our devices, but also to all our online services, commerce and banking accounts, and essentially anywhere where we need to digitally, or even physically, verify who we are.

From The Digital Identity Dilemma | Seeking Alpha

Now, in my world, words such as “digital identity” and “virtual identity” are not bandied around with gay abandon. To me, they mean something very specific and I am of the strongly-held opinion that it’s not possible to discuss such topics without some agreed model to work with. At Consult Hyperion we used “three domain identity” (or “3DID” model) to help our clients to develop their strategies for digital identity and its use in the mass market.

Three Domain Identity Model

The very kind people from Security Printers 2016 invited me down to Seville to deliver keynote about next generation identity today. I used the 3DID model to explain that in the connected world, all transactional interactions are between virtual identities and that the virtual identities ought to be constructed to allow for partitioned and partial identities. It is more than a decade since Kim Cameron published his seminal “seven laws of identity” that included the key principle of minimal disclosure, the idea that system should disclose the least amount of identifying information possible to effect a transaction.

To illustrate this point, I got one of my old “psychic ID” presentations out of the closet and used Dr. Who to illustrate my point about showing only what the relying party needs to (and is authorised to) see. But I finished up by talking about it will mean to have “smart” identity built on top of some sort of identity infrastructure (whether the 3DID infrastructure that I was talking about or some other infrastructure). This led into some pretty interesting discussions later in the day, so I thought I’d jot down a couple of notes here.

First, I explained that making something smart does not mean either putting a chip in it or putting on the blockchain. I was using smart in a more domain-specific way, unrelated to the particular implementation. I defined a smart ID to be an ID that can not present only those attributes that a relying party needs for a transaction and is authorised to see but can also verify the attributes presented by another smart ID. In other words, my smart driving licence can check whether your smart driving is real when you turn up to test drive my car . Your psychic paper can check that your date’s psychic paper is not lying when it says they have a Barclays account and are UK resident when you log in to online dating. The nightclub bouncer’s psychic paper (Android watch) can check that a patron’s psychic paper (iPhone app) shows he has a real VIP invite to the club. 

Tuesday, 9 August 2016

document-1063851711.pdf

At the beginning of August, Credit Suisse published their (135 page) equity research note on Blockchain. For this interesting, comprehensive and comprehensible report, they chose to use Consult Hyperion’s “4x4” model of shared ledger technologies to help to understand the technology and analyse its potential impact in a number of sectors.

this report pulls together the collective insights from 31 analysts in 5 sectors in 5 regions around the world. In turn, these analyst views draw upon a wide variety of expert opinions ; our analysts have met with thought leaders at Consult Hyperion and technology experts at companies closer to home like Worldpay and Equiniti.

From document-1063851711.pdf

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Monday, 8 August 2016

Podcast - American Banker

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Executives from Deutsche Bank and Royal Bank of Canada share their early learnings about distributed ledger technology at American Banker's Blockchains + Digital Currencies conference in July. 

From Podcast - American Banker

It was interesting to hear a former Morgan Stanley banker put forward the same use case for shared ledger as I had done earlier this year, which is to with ambient accountability in custodian services.

Transparency isn’t the only emergent property of SLT, of course. It also connects with the “single source of truth” without the need for a single point of failure. Goldman Sachs, for example, have spoken about this… Who might benefit from shifting to this sort of technology? Well, Goldman Sachs might. They’ve just been fined for some problems to do with the transparency of securities holdings.

From You can’t handle the (single) truth | Consult Hyperion

To my mind, this class of application of shared ledger technologies (SLTs) makes far more sense than the shared spreadsheet alternatives I often hear proposed.

Incidentally, while it’s not the subject of this podcast, I wasn’t sure about the former Morgan Stanley banker’s enthusiasm for using Bitcoin to bypass international anti-money laundering regulation.

Why I've cut up my contactless bank card...and you should too, says ROSS CLARK | Daily Mail Online

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It isn’t hard to imagine the power that the banks would wield if we lost the option of paying for items in cash and of keeping our savings in a hidey-hole at home.

They would use it as an excuse to ditch free banking in an instant. All kinds of charges would spring up for the simple reason it would be impossible for anyone to avoid them.

From Why I've cut up my contactless bank card...and you should too, says ROSS CLARK | Daily Mail Online

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POST Blockchain, identity and sunshine

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Rick Wingfield, a partner for the Australia Post Accelerator unit, told attendees of the Technology in Governance conference last week that he believes the technology could help the government streamline processes that involve ascertaining identity.

Wingfield said:

"If we're going to successfully digitize the economy and the hard parts of the economy that haven't been digitized yet ... the hard things like health, education and government services, those things require trust. If we're going to digitize some of those things, then we need to know someone is who they say they are."

From Australia's Postal Service Tests Blockchain Identity - CoinDesk

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UK Card Fraud Losses Climbed 18 Percent in 2015, Largest Rise in Europe /PR Newswire UK/

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FICO fraud consultant Martin Warwick, who provided the commentary in the map, said that the increased rate of personal data compromise through data breaches was one likely cause, but that customer expectations for a seamless purchasing experience also had an influence.

"We cardholders are very demanding, and if we don't get what we want then we let people know in the form of reviews and feedback, not to mention switching cards," Warwick said. "Banks want to avoid intervening unnecessarily when customers are shopping on the internet.

From UK Card Fraud Losses Climbed 18 Percent in 2015, Largest Rise in Europe /PR Newswire UK/

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Sunday, 7 August 2016

Police: Laptop used to reprogram, steal more than 100 cars

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Two men jailed in Houston and accused of using pirated computer software to steal more than 100 vehicles may have exploited an electronic vulnerability to advance auto theft into high-tech crime.

[From Police: Laptop used to reprogram, steal more than 100 cars]

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Cash is Dead! No. It isn’t! Pt 1

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Removing cash from certain use cases is going to be tricky as it would be perceived as penalising lower income families.

[From

Cash is Dead! No. It isn’t! Pt 1

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Tribeca Citizen | Tribeca’s First No-Cash Restaurant

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Yes, we pay a credit-card fee on every transaction, but removing the mental anguish of having to deal with cash makes it more than worth it.

[From

Tribeca Citizen | Tribeca’s First No-Cash Restaurant

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Tribeca Citizen | Tribeca’s First No-Cash Restaurant

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“Sorry, we don’t take cash,” said the cashier (right word?) at Mulberry & Vine when I went for lunch today. Instead, you can use a credit or debit card.

[From

Tribeca Citizen | Tribeca’s First No-Cash Restaurant

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No cash allowed: Stores refusing to accept money - The Boston Globe

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in Massachusetts. A state law on the books since 1978 states that no retailer “shall discriminate against a cash buyer by requiring the use of credit.”

[From

No cash allowed: Stores refusing to accept money - The Boston Globe

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No cash allowed: Stores refusing to accept money - The Boston Globe

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Amsterdam Falafelshop owner Matt D’Alessio said he stopped taking cash in December when he realized more than 85 percent of his customers — a mix of tourists and Boston University students — paid with plastic and that he could save employee time and payroll costs by eliminating cash registers and trips to the bank.

[From

No cash allowed: Stores refusing to accept money - The Boston Globe

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If cash is king, how can stores refuse to take your dollars?

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Stores don’t have to accept paper money. Despite the greenback’s apparent claim, the right for a store to refuse cash is supported both by the U.S. Treasury and the Federal Reserve.

[From

If cash is king, how can stores refuse to take your dollars?

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A New Specification Enables a Fast Dip for EMV and Speeds EMV Certification. Here’s How. - PaymentsJournal

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1. The terminal sends a random number to the EMV chip along with the total dollar value of the transaction, if it is known. The trick here is that the total value is often unknown so early in the checkout process. So to enable the chip card to be removed from the point-of-sale (POS) terminal, the POS provides the chip a “predetermined amount” for that merchant, which is typically the same value for all payment networks. The EMV chip, using the predetermined amount, encrypts the authorization request using its crypto key and delivers this ARQC message to the POS.

2. The POS holds on to that ARQC message and indicates to the EMV chip that this transaction will be conducted as a “deferred authorization.” The EMV chip card can now be removed from the POS. The POS terminal retains the ARQC message until the checkout process has determined the total dollar value of the transaction. At that time the POS constructs an authorization message that includes the ARQC crypto-encoded message (added to Field 55), the final correct dollar value into the non-chip data field (Field 4), as well as all other required data elements. This message is sent to the issuing bank.

[From

A New Specification Enables a Fast Dip for EMV and Speeds EMV Certification. Here’s How. - PaymentsJournal

]

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'Banking Is Necessary--Banks Are Not' Why has banking become less and less important to America? Let us count the ways. - May 11, 1998

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Over the years, nonbanks have had surprisingly little difficulty replicating basic bank services.

From 'Banking Is Necessary--Banks Are Not' Why has banking become less and less important to America? Let us count the ways. - May 11, 1998

That’s from almost two decades ago. It was clear then that banks had only the regulatory moat to defend their 

WeChat’s world | The Economist

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Most importantly, over half of WeChat users have been persuaded to link their bank cards to the app. That is a notable achievement given that China’s is a distrustful society and the internet is a free-for-all of cybercrime, malware and scams. Yet using its trusted brand, and putting to work robust identity and password authentication, Tencent was able to win over the public.

From WeChat’s world | The Economist

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WeChat’s world | The Economist

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Among all its services, it is perhaps its promise of a cashless economy, a recurring dream of the internet age, that impresses onlookers the most. Thanks to WeChat, Chinese consumers can navigate their day without once spending banknotes or pulling out plastic. It is the best example yet of how China is shaping the future of the mobile internet for consumers everywhere.

From WeChat’s world | The Economist

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TransferWise the first tech company with direct access to UK Faster Payments Service - TransferWise

Here’s another one of this elite milestones that don’t seem much at the time, but when you look back on it from the future it will be seen in retrospect as a key moment.

We’re excited to announce TransferWise’s integration into the UK’s Faster Payments Service (FPS) as technical partner to Raphaels Bank… The integration has been made possible by the Faster Payment Scheme Limited’s (FPSL) New Access Model.

From TransferWise the first tech company with direct access to UK Faster Payments Service - TransferWise

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POST Hey cards, come on out with your hands up

The American chip and PIN rollout seems to be pottering along nicely. Whereas in England, for example, you pay at gas pumps by inserting a chip card and entering your PIN, or in certain technologically-sophisticated parts of the country (e.g., Addlestone) by using your Shell mobile app, and despite it being several years since to my certain memory my colleagues at Consult Hyperion had a Dresser Wayne pump control with a contactless interface down at CHYP End, in Texas you pay using a trivially-counterfeitable magnetic stripe card. Naturally, freelance card data entrepreneurs know which they prefer.

At least five Exxon stations in the North Dallas area recently have been targeted by tech-savvy criminals who installed Bluetooth-equipped skimming machines on gas pumps, authorities told Fox 4 News… To avoid becoming a victim, police told Fox 4 News that it is advised to pay inside and use cash when possible.

From Criminals using Bluetooth to steal credit card info at gas stations, police warn | Fox News

There you go. In 2016, the official police advice for dealing with card fraud is… use cash instead.

Friday, 5 August 2016

Stopping Trolls Is Now Life and Death for Twitter — Backchannel

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But it’s biggest problem are those trolls. They’re winning. Too often Twitter’s users are subject to pernicious streams of abuse and harassment. This dissuades new users from wanting to sign up, drives formerly loyal tweeters to close their accounts, and gives advertisers pause as they consider where to place their brand dollars.

From Stopping Trolls Is Now Life and Death for Twitter — Backchannel

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Thursday, 4 August 2016

Tradition of recording UK laws on vellum may be saved | Politics | The Guardian

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The 1,000-year-old practice of recording laws on goat and calf skin may be saved, after the House of Lords said it would consider an offer from the Cabinet Office to pay the costs of carrying on the tradition.

From Tradition of recording UK laws on vellum may be saved | Politics | The Guardian

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Chip Card Nightmares? Help Is on the Way - WSJ

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It’s the banks, credit card companies, merchants, payment processors, terminal manufacturers and many others that have created this checkout catastrophe. But there’s a ray of hope: your smartphone.

From Chip Card Nightmares? Help Is on the Way - WSJ

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Is card fraud a barrier to cashlessness?

A while back, my old chum Ed Conway from Sky TV (better known for his foreword to Identity is the New Money, of course) ran a nice story about the British cash paradox. It turns out that since the #Brexit vote, the amount of cash “in circulation” has soared (it’s gone up by nearly two billion quid since B-day, as I call it). While the use of cash for transactions has continued to fall, the amount of cash just generally hanging around has continued to rise.

The growth rate of cash in circulation has more than doubled since January, when it was running at 4% a year, with a sudden acceleration in the weeks following the EU poll.

From More People Keeping Cash Outside Banks

Ed asks whether the cash has been hoarded, stashed or exported. I wrote about this following the Bank of England’s analysis of the situation last year, noting that 

The interesting question that the Quarterly Bulletin article by Tom Fish and Roy Whymark stimulates is straightforward: “if the majority of Bank of England notes are not being used for everyday transactions in the domestic economy, what are they being used for?”

From Where is the aggregate demand for cash coming from? | Consult Hyperion

Since the Bank of England’s own estimate is that about a quarter of the cash out there is used for “transactional purposes” and since the size of the black economy can be reasonably estimated, the answer seems to be that they are mainly used for tax evasion (primarily by SMEs), money laundering (only 0.75% of money laundering flows in the UK are intercepted), drug dealing and corruption.

We see the same phenomenon in America. The amount of cash out there continues to rise but the use of that cash continues to fall.

The use of cash has fallen more than 50% in the last four years and is projected to continue to fall as consumers look for faster and secure means of paying options. With a high degree of smartphone penetration in the US market, mobile and digital payments are rapidly gaining a market share in digital payments.

From Americans Are Using Less Cash but Mobile Payments Are Not The Ones Replacing It | Let's Talk Payments

So we that that in the US, as in the UK and many other countries, the rise of contactless and mobile payments means that the use of cash for retail transactions is falling steadily. (Contactless transactions have now reached £2 billion per month in the UK.) It is interesting, however, that in the US there seems to be much more resistance to cashlessness than in the Netherlands or Denmark or elsewhere. In his new book “The Curse of Cash”, former IMF chief economist Kenneth Rogoff says (page 111) that in America “people pay by cash for small transactions to avoid credit card theft”. Is this true? I realise that in America they still use magnetic stripes (which is why America accounts for half of all the card fraud in the world although it is only a fifth of the volume). I always use cards in the US — since I don’t care if the card details get stolen as it the banks’ problem and not mine — and I get really annoyed when I go to a coffee shop or something and it doesn’t take cards. But perhaps our American correspondents could enlighten us on this.

Tuesday, 2 August 2016

Students Rent ID Cards for Summer Profit (Local) | BEIJING TODAY

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Information platforms such as 58.com, ganji.com and douban.com bear thousands of messages about how to rent student cards from different universities… The price of such cards ranges from less than 100 yuan to more than 1,000 yuan. Some cards are only available for only three months and other require a security deposit.

From Students Rent ID Cards for Summer Profit (Local) | BEIJING TODAY

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Remember when Gill Ringland spoke at the Tomorrow’s Transactions Forum a few years ago and talked about a new class of demographic assets that would confer the right to go to certain places.

The most popular campus ID cards are Peking University’s. The average Peking University card rents for 500 to 1,200 yuan per month and allows the cardholder to access the university library, teaching buildings and restaurants.

From Students Rent ID Cards for Summer Profit (Local) | BEIJING TODAY

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Monday, 1 August 2016

[EXCLUSIVE] Asiana Airlines' customer database leaked on Internet

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The information includes citizen resident numbers, passport information, home addresses, bank account details, phone numbers and family relations records. The information, saved on the company’s website (flyasiana.com) for the past several years, is believed to have been compromised.

From [EXCLUSIVE] Asiana Airlines' customer database leaked on Internet

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3 million Saudi mobile phone connections cut due to fingerprint law - Technology - ArabianBusiness.com

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Around 3 million mobile phone connections have been disconnected in Saudi after users failed to register their fingerprints in line with the new security measure instated by the Communications and Information Technology Commission (CITC).

From 3 million Saudi mobile phone connections cut due to fingerprint law - Technology - ArabianBusiness.com

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US fintech pioneer’s start-up in Kenya — FT.com

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InVenture, which is based in Santa Monica, California, but operates in Kenya, uses a mobile phone app to scrape data off a person’s mobile phone to give them a “financial identity”, as Ms Siroya puts it. The data range from mobile money spending patterns and calling and travel routines, to the way contacts are organised: for instance repayment of a loan is more likely by someone whose contacts are listed with both first and second names.

“We picked the smartphone data [as the basis for their financial identity] because we felt that was the closest proxy to someone’s daily life,” says the 32-year-old.

The company then issues uncollateralised loans to those who pass the algorithm’s benchmark

From US fintech pioneer’s start-up in Kenya — FT.com

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France’s BPCE to buy fintech Fidor Bank — FT.com

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The old and new worlds of banking came together on Thursday as Fidor Bank, the German online bank, said it had agreed to be acquired by Groupe BPCE, the large mutually owned French lender.

From France’s BPCE to buy fintech Fidor Bank — FT.com

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