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xxx "countries will form cryptocurrency unions to regulate currencies and platforms, standardise technology and maintain the stability of the system" From "When China and other big countries launch cryptocurrencies, it will kick off a global revolution" . xxx

xxx "Moscow’s support for Instex prompted a warning from US Treasury secretary Steven Mnuchin, who attended a G7 financial meeting in France. ‘If you want to participate in the dollar system you abide by US sanctions,’ Mr Mnuchin said, after discussing Iran with his French counterpart Bruno Le Maire." From "(4) Kremlin throws weight behind EU effort to boost Iran trade | Financial Times" . xxx

xxx "Innocent people have been questioned by police, had computer equipment confiscated and faced arrest when suspected of serious crimes following errors made by internet service providers (ISPs), telecoms companies, police and other public bodies in gathering intelligence through electronic surveillance." From "Innocent people arrested following surveillance blunders, IPCO reveals" . xxx

xxx "In October an investigative report from BuzzFeed detailed how Ads Inc. paid to place deceptive ads on thousands of personal Facebook accounts. Ads Inc. reportedly paid Facebook users $15 to $30 per month for access to their account, then sold those accounts to other marketers for $800 each. By paying Facebook users to post ads on their personal page, Ads Inc. and other companies are able to circumvent Facebook's policies for paid advertisements. Facebook prohibits account rentals and deceptive advertisements, and Facebook has been actively banning accounts sharing posts for Ads Inc. However, Ads Inc. CEO Asher Burke and other employees offered multiple Facebook contractors payment in exchange for reversing the bans" From "Facebook contractor accepted bribes to restore banned accounts: report - Business Insider" . xxx

Oh man! 2017! This was the first public “live five” of technology-driven changes in the secure transactions field that we thought would have a real business impact over the previous year. We’d used the idea internally before, but in 2017 we made the predictions public in the spirit of openness and honesty that we are famed for, to see how the predictions held up. RegTech . I think we did pretty well with this prediction. Interest in regtech has grown throughout the year and the ability of regtech to make real differences in major markets is established. Digital Identity . As we noted, one of the key regtechs, if not the key regtech, is digital identity. It did shoot up the agenda over the year and some interesting initiatives opened up. PSD2 (still). No commentary is needed!. Paying on the Go . We thought that a key use of open APIs will be payments, and very likely mobile payments. MasterCard’s purchase of VocaLink would tend to support this view! Invisible POS .  The shift fro

xxx Gibson first used the word “cyberspace” in 1981, in a short story called “Burning Chrome.” How William Gibson Keeps His Science Fiction Real | The New Yorker : xxx

xxx US officials are also concerned about the possibility that foreign countries will increasingly use mass-market digital currencies, such as Facebook’s planned Libra coin, to avoid sanctions. (1) FBI says blockchain expert aided North Korea | Financial Times : xxx

xxx Mr Couré recently praised an initiative by about 20 large European banks including BNP Paribas and Deutsche Bank to create a new digital payments system — dubbed the Pan European Payment System Initiative, or Pepsi. The idea is to enable instant cashless payments through a European rival to ApplePay in the US and Alipay in China [but] the project is becoming bogged down with competition authorities in Brussels for being too much of a closed shop. (1) Central bank talk of launching cryptocurrencies is all bluff | Financial Times : xxx

Huang Qifan, vice chairman of CCIEE (China Center for International Economic Exchanges), speaking at the Inaugural Bund Financial Summit of 2019 in Shanghai, said that " in the current digital age, the payment and settlement methods between enterprises and countries need to be reshaped ”. He also went on to say that cross-border liquidation of China’s renminbi (RMB) is "highly dependent" on SWIFT (Society for Worldwide Interbank Financial Telecommunication) system and CHIPS (the US Clearing House Interbank Payments System). He added that the two financial instruments that are "gradually becoming effective tools for the US to exercise global hegemony and carry out widespread jurisdiction control”.

xxx Money has always been a powerful, blunt instrument. It’s an imposition not just of will, but of values. After World War II, the dollar became the foundation of the international monetary system. That gave the U.S. government a special tool. Brace for the Digital-Money Wars - WSJ : xxx

xxx This is not just a poor-world problem. Britain was recently rocked by the “Windrush” debacle, in which dozens of citizens were wrongly deported. But it is a particularly acute problem in sub-Saharan Africa, where one in two people cannot prove his or her identity. It is not for want of effort. Every country in the region has either established or plans to create a universal identity programme. Papers, please - African countries are struggling to build robust identity systems | Middle East and Africa | The Economist : xxx

xxx "The number of card payments in the euro area have more than doubled in a decade as consumers increasingly dispense with the hassle of carrying notes and coins, according to the latest statistics from the European Central Bank. In 2018, card payments accounted for almost half of the total number of non-cash payments across the single-currency area. Credit transfers and direct debits were the second and third most common non-cash payment methods, accounting for approximately 23% each, while e-money and cheques together made up around seven percent. However, the relative popularity of each type of payment service still varies widely across euro area countries. In 2018 card payments accounted for just over 70% of all non‑cash payments in Portugal, compared with around 23% in Germany. The stats show that the number of card payments made by consumers and businesses has more than doubled in the last decade, with an average of 121 card payments per capita in 2018, compared with

I tend to agree with people who see privacy as a function of control over personal information. Not a thing, more like a trade off . It’s a big problem though that the trade-offs in any particular situation are multi-dimensional and nothing like as explicit as they should be. And what if you have no possibility of control? The always interesting Wendy Grossman made me think about this in her recent net.wars column about her neighbour’s doorbell camera .  As Wendy puts it “we have yet to develop social norms around these choices”. Indeed. Whether it is neighbours putting up doorbell cameras or municipalities installing camera for our comfort and safety, the infrastructure of cameras (much more cost effective and useful than the one imagined by George Orwell) and pervasive always-on networks is going to created a decentralised surveillance environment that is going to throw up no end of interesting ethical and privacy issues. Here’s an example. What happens if you set up a camera trap

North Korea is, apparently, developing a digital currency of its own. According to Alejandro Cao de Benós , President of the Korean Friendship Association, the Democratic People’s Republic of Korea intends to go down the Facebook route by creating an asset-backed digital currency rather than a digital fiat currency and then use some sort of blockchain with “Ethereum-style smart contracts” to do business and avoid sanctions. Why use a blockchain? Well, the regime sees such smart contracts as a way to enforce deals it makes with foreign counterparts. Since it doesn't trust the U.N., it relies on Chinese intermediaries to enforce deals abroad. But sometimes, so sources claim, those intermediaries cheat the North Koreans. Hence, they want to bypass intermediaries altogether by developing a  “token based on something with physical value” (eg, gold) in order to create a stable mechanism for payments in international trade between the regime and "other companies/individuals” (althou

xxx Do you think it is inevitable that the U.S. Treasury will make the leap to the digital coin of the dollar? ‘Currently, Congress is set up in a way that matches the economy of 200 years ago.’ I think we are going to be in trouble if we don’t. The one good thing about the Libra proposal is that it [brought attention to] China, which has been working at some level for several years on central bank digital currencies. Why Libra Worries This Physicist-Turned-Congressman — The Information : xxx

xxx Providing citizens of advanced countries the ability to authenticate themselves online is something that will be essential for central bank digital currencies or any traceable currency. Even if Libra was perfectly traceable, if you are allowed to set up a fake identity and start trading Libra, it is meaningless. Why Libra Worries This Physicist-Turned-Congressman — The Information : xxx

xxx Currently, Congress is set up in a way that matches the economy of 200 years ago. For example, at the time of our Founding Fathers, 70% of our GDP was subsistence farming. Now agriculture is down to maybe 1½% of GDP, and yet the Agriculture Committee has all the good congressional office space, to put it in congressional terms. Congress should match itself to the economy as it exists. Why Libra Worries This Physicist-Turned-Congressman — The Information : xxx

xxx The European Central Bank has welcomed an initiative by some of Europe's top banks to explore the development of a rival payment system to challenge the dominance of Visa and Mastercard and the threat from Chinese and US Big Tech firms Backed by twenty French and German banks, the The Pan European Payment System Initiative (Pepsi) would seeks handle all forms of cashless transactions. ECB offers support to bank-backed alternative to Visa and Mastercar... : xxx

xxx In a speech, Banque de France first deputy governor Denis Beau says that his organisation is "quite open for experiments" with the ECB on a wholesale CBDC. French central bank floats European CBDC : Why  Speaking about the inefficiencies that still bedevil cross-border payments, Beau says: "The tokenisation of financial assets combined with the recourse to blockchain-based solutions and more broadly distributed ledger technologies to store and transfer those assets could help answering market’s demands." French central bank floats European CBDC : The tokenisation of financial assets is, of course, a much broader topic than CBDC and (as I have said for some time) and inevitable trend. In my mental model of the world, I look from that perspective. So we use the cryptocurrency platform to trade tokens, and one form of these tokens (homomorphic to, but necessarily built from, ERC-720) is digital currency and one option for implementing digital currency is

xxx "I need to know you and that’s based on data. Why should data be regulated in a different way if you’re called a bank and if you’re called something else" From "Ana Botin of Santander on FinTech and Blockchain - Chris Skinner's blog" . xxx

I was quoted in The Economist (“ Plug and pay ”, 21st November 2019) talking about the impending reshaping of the retail financial services sector. Although the quote isn’t quite accurate — I was responding to the statement that a a bank is a balance-sheet, a factory that turns capital into financial products (such as loans and mortgages) and a sales force, I didn’t make it — the paraphrase is correct. Those first two activities are heavily regulated, as they should be, which is why Big Tech is uninterested are in them. They are more than happy to have banks, for example, do this boring, expensive and risky work with all of the compliance headaches that come with it. As noted in article, the Apple credit card is actually issued by Goldman Sachs (although it was Apple that caught the flack in the row about gender discrimination around credit limits) and the Amazon cards are issued by Chase, Synchrony and American Express. Similarly, the Google “checking” account (this is the American wo

xxx The dollar’s falling share of reserves represents an “official sector vote against US ‘exceptionalism’”, said Mr Ruskin. In his view, the data should give pause to US policymakers contemplating laws to tax foreign purchases of US assets, further sanctions based on the international use of the dollar and plans to restrict access to US capital markets. All are actions that could weaken the dollar’s influence. Why central banks are edging away from the dollar | Financial Times : xxx

​​​ITU Workshop on Standardizing Digital Fiat Currency (DFC) and its Applications New York City, USA, 18-19 July 2018 Case: The State of DFC Implementation in China People's Bank of China (PBOC) has been a leader in thinking strategically about DFC deployments at a large scale with a mixture of heavy cash use and robust and growing use of mobile payments. This will highlight PBOC's efforts in meting these challenges. Yao Qian,Vice Director-General of Technology Department, People's Bank of China [ Presentation ] xxx

xxx Western regulators could ultimately ban the use of China’s digital currency, but that wouldn’t stop it from being used in large parts of Africa, Latin America, and Asia, which in turn could engender some underground demand even in the US and Europe. The High Stakes of the Coming Digital Currency War by Kenneth Rogoff - Project Syndicate : xxx

xxx Powell said… a digital national currency may not offer advantages to the U.S. that it may do to other nations Fed Reserve Evaluating Digital Dollar But Benefits Still Unclear, Says Chairman - CoinDesk : xxx

xxx Sean McFate, a former US paratrooper and now adviser to the Pentagon, but not quite as Hollywood might want us to believe. “When people think about cyber they think about sabotage, but the true power of cyber is information; to shape people’s perception of reality and to craft a narrative,” he says. “That’s the future of war, not tanks. Is Britain already in a cyber war? : xxx

xxx The Microsoft-owned company's first moderation report, published on Thursday, revealed that 19.5m fake accounts had been automatically tackled at the moment of registration by its AI systems, with a further 2m "restricted" after being created. Are LinkedIn's 21m fake accounts the work of spies? : xxx

xxx A live simulation of a White House National Security Council meeting during a major national security crisis with former senior administration officials and thought leaders Nicholas Burns, Ash Carter, Jennifer Fowler, Gary Gensler, Aditi Kumar, Neha Narula, Meghan L. O’Sullivan , Eric Rosenbach, Lawrence H. Summers, and Richard Verma. Digital Currency Wars: A National Security Crisis Simulation | The Institute of Politics at Harvard University : xxx

xxx xxx “Using #cash does not give you anonymity!” @dgwbirch tells us the story of Richard the Lionheart and how he’d perhaps have been better off #cashless with a #digitalidentity . pic.twitter.com/rSKAZjdq7s — Mastercard Austria (@MastercardAUT) November 21, 2019 So for my friends around the world, here is the whole story! At the siege of Acre in 1191, during the Third Crusade, Richard the Lionheart supervised the building of siege engines to breach the walls of the city and thus led to its fall in July of that year. He immediately quarrelled with Duke Leopold V of Austria over the spoils of war and eventually tore down Leopold’s banner and sent his army on their way, thus ending early attempts at a common European foreign policy in the Middle East. In October, after decapitating 2,800 prisoners in another dispute with Saladin, Richard left for England to stop his brother Bad King John (“Lackland”) from usurping him. On his way back to England, Richard could not go

xxx So the upshot is that China's CBDC will be providing a certain sort of privacy to users. Which reminds me about what Rodney Garratt and Morten Bech, two economists that specialize in payments systems, have written about payments anonymity. According to Garratt and Bech, there are two grades of payments anonymity. With third-party anonymity, a person's true identity is hidden from everyone who participates in a transaction, including the system operator. Banknotes are the best example of third-party anonymity, since the issuer—the central bank—has no idea who is using them. Counterparty anonymity is less strong. This sort of anonymity prevails when personal information about the two counterparties to an exchange remain hidden from each other but the system operator is still privy to each user's identity. Yao's controlled anonymity presumably means that DCEP will provide Garratt and Bech's second sort of anonymity, counterparty anonymity. Moneyness: "Cont

xxx In a Nov. 19 letter responding to questions from lawmakers Rep. French Hill (R-Ark.) and Rep. Bill Foster (D-Ill.) in late September, Powell said the Fed has noted the efforts of other nations to explore a CBDC option, and that it continues to "carefully analyze the costs and benefits of pursuing such an initiative in the U.S." Fed Reserve Evaluating Digital Dollar But Benefits Still Unclear, Says Chairman - CoinDesk : xxx

xxx "Sixty two percent of U.S. respondents in Bain’s annual retail banking report published Monday said they would buy a financial product from an established technology company. Among people ages 18 to 34 it was even higher -- roughly 75% said they would be open to banking with a tech giant." From "Majority of Americans would try banking with big tech: Bain report" . xxx

xxx "Practical MaaS delivers public transit ticketing within consumer facing or white label MaaS apps such as; Uber, Transit, Moovit, Gertek and Kisio Digital. This connects public transit with private mobility services without the need for discounts on tickets or new business models." From "The Future of Fare Payments: Account-Based Ticketing and MaaS" . xxx

xxx The Chinese have, to an extent, leapfrogged the credit and debit card revolution that overtook advanced economies in the last century, with most of new adopters using mobile technology to go cashless… almost two-thirds of online sales and more than one third of payments in stores were now made through leading mobile wallet operators including Alipay and WeChat Pay. From China's march to be the world's first cashless society: China Daily contributor, East Asia News & Top Stories - The Straits Times .   xxx xxx "Technically, it's illegal for Chinese merchants to refuse payment in cash, but this rule is hardly ever enforced, and China has been sprinting to a cashless society that requires mobile devices -- not credit-cards -- to effect payments, even to street hawkers. This has lots of implications for privacy, surveillance, taxation, and fairness, but in the short term, the biggest impact is on visitors to China, who are increasingly unable to buy anyth

xxx Contactless cards accounted for just under one-third of [UK] credit card transactions and getting on for half (46 per cent) of transactions on debit cards, Contactless payments continue to soar | Financial Times : xxx

xxx "Fundamentally, a bank is a balance sheet, a data-processing system and a sales force." From "Cache crunch: Google-Citi deal could be future of banking | Financial Times" . xxx

xxx "The US tech firms need only look to Asia for a lesson in how a push into banking can accelerate their growth. There, tech firms plowed into finance years ago and largely won out. In Beijing, it’s embarrassing to pull out a credit card rather than a QR code that links to your WeChat account. Ant Financial, the banking arm of Alibaba, is far bigger than Goldman Sachs, the bank that helps Apple issue its credit cards. On the same apps you use for news and games and texting, you can also get loans, credit, and manage your investments." From "Every Tech Company Wants to Be a Bank—Someday, At Least | WIRED" . xxx

xxx It’s not surprising that given the choice between a free, seedy internet and a costly, orderly one, more people are opening their wallets. Online Cesspool Got You Down? You Can Clean It Up, For a Price - The New York Times : xxx

xxx A study by the Office of the Children’s Commissioner for England found that Fortnite character skins — they’re like costumes for your avatar — have become a source of social cachet for young kids. Poorer kids who use the free, default skin inside the game report being bullied by their peers who can afford to buy rarer ones. Online Cesspool Got You Down? You Can Clean It Up, For a Price - The New York Times : xxx

The stain of racism in football is, you will be unsurprised to learn, not confined to Bulgarian stadia. It’s a serious and unpleasant problem on social media too. To the extent that the noted association footballer Mr. Harold Macguire has been talking about it. According to The Daily Telegraph , "Maguire urged Instagram and Twitter to make users identify themselves in the same way as betting apps after his teammate Paul Pogba was subjected to a torrent of ‘disgusting' racial abuse from anonymous trolls”. Many other people seem to think that we should do something about this. Following Mr. Macguire’s analysis, the historian Damian Collins MP (chair of the Digital, Culture, Media and Sport select committee in the UK Parliament) said “Account verification should be more widely available and become the norm. I think accounts should be verified, it can’t be right that cowards and racists can hide behind the anonymity of social media to attack people, often using multiple bogus acc

xxx "Proposals by seven UK banks to levy a per transaction fee for for certain Faster Payment transactions as a means to provide a long-term, sustainable funding arrangement for the reimbursement of APP scam victims, have been knocked back by governing body Pay.UK following an industry-wide consultation" From "Pay.UK knocks back Faster Payments fees to cover APP fraud" . xxx

xxx Users will be able to add preferred payment methods - including most major credit and debit cards, as well as PayPal - once and then use Facebook Pay without having to re-enter their details. Facebook Pay consolidates payments across apps : xxx

xxx As Hong Kong’s anti-government protests stretch into their 23rd straight week, the city is being inundated with online rumors, fake news and propaganda from both sides of the political divide. The polarizing rhetoric is fueling distrust and violence, making it harder to resolve the crisis that has plunged Hong Kong into a recession and raised doubts about the city’s role as Asia’s premier financial hub. How Fake News and Rumors Are Stoking Division in Hong Kong - Bloomberg : xxx

xxx female applicants were more likely to be accepted for credit and their rejection rates were lower in comparison to men, proving that equality law in fact is a disadvantage for women in algorithmic credit decisions Gendered credit scoring increases women's chance of credit acce... : xxx

xxx The National Fraud Intelligence Bureau (NFIB) and one of the UK’s largest mobile phone networks, EE, have raised concerns about banks’ growing reliance on text messages when authorising large payments. FBI turns up the heat on banks over Sim scams | Money | The Sunday Times : I seem to remember first raising concerns about the banks’ use of text message for authorisation about a decade ago, but no-one ever listens to me. Of, it appears, anyone else who has said this over the last ten years or so. Now, I’m not saying that no banks at all have listened to the cacophony of security experts telling them not to use text messaging for a purpose for which is was never intended. Earlier this year, German banks dropped support for SMS -based OTP as 2FA for SCA in PSD2 .   In the UK, it’s the mobile operators who have taken action . They have created something call “SMS Phishguard” which means that (I think) fraudsters will not be able to ‘spoof’ numbers so that bogus texts appear t

xxx App developers get access to Apple’s robust anti-fraud technology to identify which users are real and which may not be real. Answers to your burning questions about how ‘Sign in with Apple’ works | TechCrunch : xxx

It’s that time of year again. I’ve had a chat with my colleagues at Consult Hyperion, gone back over my notes from the year’s events, taken a look at our most interesting projects around the world and brought together our “ live five ” for 2020. Now, as in previous years, I don’t expect you to pay any attention to our prognostications without first reviewing our previous attempts, otherwise you won’t have any basis for taking us seriously! In 2017 we highlighted regtech and PSD2, in 2018 it was open banking and conversational commerce, last year it was secure customer authentication and digital wallets — so we’re a pretty good weather vane for the secure transactions world! So let’s turn to what we see for next year...  Oh man! 2017! This was the first public “live five” of technology-driven changes in the secure transactions field that we thought would have a real business impact over the previous year. We’d used the idea internally before, but in 2017 we made the predictions public

xxx "Demaskuok, which means ‘debunk’ in Lithuanian, is a piece of software that searches for the patient zeros of fake news. It was developed by Delfi, a media group headquartered in Lithuania’s capital, Vilnius, in conjunction with Google, a large American information-technology company. It works by sifting through reams of online verbiage in Lithuanian, Russian and English, scoring items for the likelihood that they are disinformation. Then, by tracking back through the online history of reports that look suspicious, it attempts to pin down a disinformation campaign’s point of origin—its patient zero." From "Disinformation - Lithuanians are using software to fight back against fake news | Science and technology | The Economist" . xxx

xxx Two former employees of Twitter have been charged in the US with spying for Saudi Arabia. The charges, unsealed on Wednesday in San Francisco, allege that Saudi agents sought personal information about Twitter users including known critics of the Saudi government. Ex-Twitter employees accused of spying for Saudi Arabia - BBC News : xxx

xxx China’s digital currency will create a “horse race” when it is launched as commercial banks and other institutions compete to provide the best services using the new form of money, a central bank official said China's digital currency will kick off 'horse race': central bank official - Reuters : xxx

I had the pleasure of attending a “ Horizon Brief ” organised by the Centre for the Study of Financial Innovation  (CSFI) for Dentons. The well-informed speakers, ably chaired by Andrew Hilton (Director of the CSFI), were lawyer Dominic Grieve (the day after he ceased to be an MP), lawyer Anton Moiseienko from Royal United Services Institute Centre for Financial Crime and Security, lawyer Richard Parlour (Chairman of the EU Task Force on Cybersecurity Policy for the Financial Sector at the Centre for European Policy Studies ) and lawyer Antonis Patrikos from Dentons’ Privacy and Cybersecurity Practice . There was a deal of discussion about Russia and China, cyberattacks and critical national infrastructure, and also the nature of serious crime as it shifts towards online. Much of the discussion was illuminating, and I won’t repeat it all here, but I particularly enjoyed the points made about cryptocurrency as a facilitator for cybercrime.  (I can't resist quoting Marshall McLuh

I had the pleasure of attending a “Horizon Brief” organised by the Centre for the Study of Financial Innovation for Dentons. The well-informed speakers, ably chaired by Andrew Hilton (Director of the CSFI), were lawyer Dominic Grieve (who used be the Attorney General and, until yesterday, Chair of Parliament’s Intelligence and Security Committee), lawyer Anton Moiseienko from Royal United Services Institute Centre for Financial Crime and Security, lawyer Richard Parlour (Chairman of the EU Task Force on Cybersecurity Policy for the Financial Sector) and lawyer Antonis Patrikos from Dentons’ Privacy and Cybersecurity Practice. During questions, I asked about the comments of one of Dominic’s former colleagues, Margot James, the Minister for Digital Thingies. She was quoted in The Daily Telegraph that the UK must "get over" privacy and cyber security fears and adopt technology such as online identities. While this Minister was advocating online identities, another Minister wa

xxx "Accenture noted that revenue from credit card transactions by business dropped by 33 per cent globally between 2015 and 2018, while consumer debit card transactions fell by nearly 15 per cent during that period." From "Banks in Hong Kong, mainland China must buck up or lose US$61 billion in revenue to e-payment providers, Accenture says | South China Morning Post" . xxx

xxx Potential visitors to the US were recently confronted with a new requirement on the long and complicated visa application form — to provide information about their social media identities. Does cyber security cross the line when crossing borders? | Financial Times : xxx

The last time that I bought a car, I paid for it this way. I went to look at the car, test drove it and then did a bit of online research. The price seemed fair for the condition, so I called the dealer back and agreed the sale. He told me his bank sort code and account number. I put these into my Barclays account and transferred £10 to the dealer. He texted me a minute or so later to confirm that the money had been received. So then I called my insurance company to add the car to my policy. Then I drove over to the dealership and to pick up the car and the documents. While I was there, I used the Barclays app on my phone to transfer a few thousands of quids to the dealer. About 30 seconds later he checked his account and saw that the money was there, so he gave me the keys and off I went. (Meanwhile, my friend Simon told me that to pay his rent in New Jersey, he logs in to his American bank account to instruct the payment, then the bank prints out a paper cheque that it mails to his