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America is a strange country to foreigner such as myself. And one thing that is particularly strange about it is the constant demand for identification in a society that lacks an identity infrastructure. The most obvious manifestation of this, as I’ve written before, is that when I am asked for identification (in order to get into a building in America, for example) I can present documents that the security guard cannot conceivably verify or validate (e.g., my UK driving licence) or documents that are not identity documents at all (e.g., my expired building pass for our office in New York) and gain entry. This is, as is often remarked, security theatre not security. It’s like a play about security where we all say our lines and play our parts but there’s no actual security involved at all. When it comes to identity, there’s definitely something odd about America. Buying an assault rifle is easy. You need not show formal identification… Opening even the most basic bank account is far ...

Now onto part three of our week of thinking out loud about putting identity on the blockchain. In part one we found a problem that could be solved using some kind of identity infrastructure. In part two we came up with a model of digital identity that we could use to explore a potential solution to this problem. Now, we are going to think about how that model could connect with some kind of shared ledger in general and with a blockchain or, indeed, the blockchain. Our starting point is to observe, as my colleague StevePannifer said in his presentation at the Cloud Identity Summit in New Orleans this week, a ledger is a record of transactions. Therefore, we must think about the identity transactions implied by the model that we looked at in part two before we start to think about how to store them in a shared ledger. We start by observing that identity transactions are the “CRUD” (that is the Creation, Reading, Updating and Deleting) of identities. Since our model includes three kin...

xxx Yesterday it was reported that members of the European Parliament voted in favour of creating a cryptocurrency "watchdog" to combat money laundering and terrorist financing. This is misleading. In fact two parallel initiatives have been conflated in the press announcement: one is the creation of a Virtual Currency Task Force, and the other is the inclusion of virtual currency exchanges within the ambit of the European Anti-Money Laundering Directive. From What the European Parliament vote on cryptocurrency regulation really means Indeed. Along with many other people I gave evidence to the European Parliament in their hearings on this subject, and I agree with Siân Jones, of the European Digital Currency and Blockchain Technology Forum, one of the other people who gave evidence and who is quoted in that article as saying "why would you say that casinos have to have all these things, or estate agents, but not virtual currency exchanges"? 

xxx A taxpayer who bought and handed over £15,000 in Apple iTunes gift card vouchers is one of “hundreds” of HMRC customers to be defrauded in the past month, a scam bulletin says. From Fraudsters posing as HMRC hijack iTunes :: Contractor UK xxx

xxx CVS Pharmacy today announced the company will launch digital receipts as a new option for all members of its ExtraCare Rewards program. The new option for digital receipts will roll out in early June and eventually be available in 7,900 retail locations. Customers will have the opportunity to opt-out of receiving paper receipts for all in-store purchases when completing their transactions in the front of the store. Once the one-time process is completed, customers will receive receipts digitally, along with their coupons and rewards, each time they shop at CVS Pharmacy. From CVS Pharmacy Says "So Long, Long Receipts," Announces Arrival of Digital Receipts for Customers | CVS Health xxx

I ignore almost all of the “news” that arrives via my cryptocurrency feeds, but a particular story about Bitcoin in the mass market caught my attention because it appeared to herald an unexpected and significant shift in the mass-market. The announcement was that Starbucks is " working with Microsoft and a leading global exchange on a new digital platform that will allow consumers to use bitcoin and other cryptocurrencies at Starbucks ”. This struck me as a little odd, since Howard Schultz, (the executive chairman of Starbucks) said earlier this year that “ I don’t believe that bitcoin is going to be a currency today or in the future ”. When I read the story in detail in turned out to be untrue, just as I has suspected, and a couple of days later came the further annoucement that " Starbucks has clarified that it will not be accepting Bitcoin (BTC) or other cryptocurrencies as payment ”. Starbucks has no intention of accepting Bitcoin at retail point of sales (and nor, I ima...

xxx Public transport companies in the Netherlands are planning to abolish cash payment for bus and tram tickets, following a significant rise in robberies. By 2018 it will only be possible to pay for travel using the national OV Chipkaart contactless smartcard, a smartphone, or a contactless bank card. From Dutch to abolish cash payments for public transport | International Railway Journal xxx Eliminating cash payments will require significant investment - each tram and bus will need to be equipped with a payment terminal at an estimated cost of €1500 per vehicle. From Dutch to abolish cash payments for public transport | International Railway Journal xxx

xxx the government said authorities know of no money laundering cases in which the huge bill was a relevant factor From Cash Is King: Swiss Defend Huge 1,000-Franc Bank Note - ABC News xxx

xxx Will instant payments exacerbate existing societal problems? Will they place already vulnerable people in harm's way? And if so, whose problem is this to address: the bank, the regulator, the operator of a scheme? Or perhaps the onus falls squarely on the consumer alone? From Should Faster Payments Be, Well, Slower? | Bank Think xxx

xxx This puts the FCA in a difficult position as it wants Britain to be “a hostile sector for money launderers” but also to ensure “the unintended consequences of anti-money laundering (AML) regulation are minimised.” From Banks dump small businesses, charities and fintech firms to save on red tape costs xxx

xxx British banks are increasingly willing to scrap the accounts of charities, small businesses and fintech firms in a bid to cut the cost of regulatory compliance and anti-money laundering controls, according to a report commissioned by the Financial Conduct Authority. From Banks dump small businesses, charities and fintech firms to save on red tape costs xxx

xxx Paying by phone was commonplace [in Stockholm], and I didn’t even get a weird look when I scanned a QR code at a grocery store checkout and wordlessly strolled away with my basket of smoked meats. From What The Mark Of The Beast Taught Me About The Future Of Money - BuzzFeed News xxx

xxx M-Pesa has effectively invented a new form of credit that’s based on a history of reliable transactions from phone to phone From What The Mark Of The Beast Taught Me About The Future Of Money - BuzzFeed News xxx

xxx A political battle between the UN-recognised Tripoli government led by Fayez Sarraj and the Tobruk-based parliament loyal to General Khalifa Haftar in the east has led to parallel splits in the country’s financial institutions, with two central banks threatening to circulate rival Libyan dinar banknotes in the country. From Battle of the banknotes as rival currencies are set to be issued in Libya | World news | The Guardian Apparently there’s going to be one lot of good old British-sourced banknotes and another lot of dastardly Russian-sourced banknotes duking it out across the desert. Fascinatingly, while I was reading this piece, Benjamin Cohen’s “ Currency Power ” was on my bedside table!

xxx Releasing software as an API allows those companies to pursue a number of different adoption routes. Rather than trying to sell specific industry verticals or use cases, often the customer is a developer, leading to an extremely low-friction sales process. From The rise of APIs | TechCrunch xxx

xxx Dr Francis Wangusi, Director General of the Communications Authority of Kenya, said… “The requirements for opening a bank account were and still are stringent and unfavourable to low income earners". From Why M-Pesa is a successful story in Kenya | News24 Nigeria xxx xxx Registration was very simple and the costs were cheap. Also unlike traditional banks, there were many access points called "agents" all over the country. From  Why M-Pesa is a successful story in Kenya | News24 Nigeria xxx

xxx In the UK, the proportion is two-thirds. Here, around 59pc of smartphones run on Android, while another 35pc are iPhones, according to Kantar Worldpanel ComTech, both of which offer m-pay options. Mobile payments are going to be far more ubiquitous than their plastic counterparts, relegating contactless cards to being an offline backup in dire phone battery situations.  From Contactless cards are on borrowed time - they're just an interim for phones Actually, if the smartphones implement the standard properly (Apple don’t) then you should be able to use to your phone to pay even when the battery is dead because the microchips that do the payments get their energy from the electro-magnetic field of the reader, just as the microchips in a contactless card do.

Back in 2014, I wrote about how stupid the idea of making people very their age with credit cards for access to adult content. Forcing people to give their credit card details out willy-nilly will inevitably leading to an explosion in card fraud, From Porn is a serious issue, and so is identity | Consult Hyperion So things like the Ashley Madison data leak were entirely predictable. Entirely predicted, in fact. xxx At the seminar Helen said the “The gap between real-world identity and online identity is at the root of [the problem of cyberbullying]”. So let’s close that gap. Not by requiring (and policing) “real” names, but by implementing pseudonymity correctly. From  We can contribute to childhood e-safety | Consult Hyperion xxx

xxx The idea that permissioned blockchain startups are now up against substantial challenges can be seen in the shifting strategies at startups R3 and Digital Asset Holdings. Greenspan noted that both are working less on distributed ledgers, and more on "contract description languages". From On Blockchain Disillusionment and Bitcoin's Big Bad Wolves - CoinDesk xxx

xxx unlike Smart Contract platforms, agreements written using DAML do not need to be shared across multiple, often completely public, nodes in a network. Parties do not need to reveal the terms of their agreement to any undesirable third parties and it can be safely processed and authorized by only the relevant participants. All data is revealed on a need to know basis and even the distributed ledger, which only contains references to the agreement, is encrypted so other entities cannot detect even its existence on the ledger, let alone the terms. From Introducing the Digital Asset Modeling Language - Digital Asset xxx

xxx Tencent would want to hope most WeChat users aren't like Cai Jiami. The 31-year-old hastily transferred the balance in her WeChat "wallet" – roughly 7,000 yuan ($1070) – to her personal bank account before the Tencent-backed mobile messaging app could charge her for doing so. "It's not a lot of money but I just don't like to be charged," Jiami, a wedding planner based in China's southwestern Chengdu city, told CNBC. "I have Alipay on my phone, which is free and working well. Why would I waste money on WeChat?" From March 1 WeChat will charge users a fee of 0.1 percent when they transfer money from the app's built-in digital wallet to their personal bank account. According to an announcement by Tencent, the charge will be levied on withdrawals of more than 1,000 yuan ($153), with the minimum fee per transfer set at 0.1 yuan. WeChat also said it would scrap an existing monthly charge on large cash transfers; it currently charges use...

xxx A trial in the Bay Area involving 50 small businesses and 50  McDonald’s restaurants is allowing Google to hide payments in the background of retail transactions. It’s called Handsfree, it was announced at Google’s developer conference last month, and while this technology is admittedly in its “early days” as Spinnell puts it, it’s indicative of a future we’re heading toward where your identity matters more than your phone. From Money20/20 Europe: Android Pay Handsfree is Easier Than Tapping xxx

xxx Future applications of this technology will in all probability not be used to unlock smartphones, thought that cannot be ruled out. The group behind the work sees loads of potential for it when it comes to high-security settings, where a restricted number of authorized users need ultra high-level access. From Researchers can accurately identify people using their brain waves xxx

xxx A Scottish Council has given local government workers the power to create fake Facebook accounts, befriend citizens and spy on them for the prevention of “disorder” and “perceived mischief”. From Local Government Approves ‘Covert’ Spying On Citizen 'Mischief' As I am very fond of repeating, yes in cyberspace no-one knows you’re a dog but on the other hand no-one knows you’re from the FBI either.

I happened to be talking about APIs at a client event today, and got involved in a discussion about how the fintechs might begin to work with banks in the new world of PSD2 and mandatory APIs. This has been subject of great interest to me at the recent Money 2020 Europe (with top, top players like Shamir Karkal from BBCA and Alex Mifsud from Ixaris explaining why the move to APIs will mean a big shift in the delivery of banking services) and other recent events. Generally speaking, and this is a sweeping generalisation, I think there has been a shift in European bank thinking in recent times. They well understand that if they do nothing, then in the instant payments, API-centric, PSD2 world they stand to lose significant income. The outsourcing company Accenture, for example… estimates that the new new breed of payment initiation service providers will erode 33% of online debit card transaction volumes and 10% of online credit card transaction volumes resulting in a total market sha...

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 xxx

xxx The U.S. dollar is the preferred currency in Zimbabwe at present, but others are welcome. "We are saying that since you can import/export goods from South Africa you can use the rand. If you are importing from China you can use the yuan. The U.S. dollar is our reserve currency," explained Mangudya. Implementing cashless systems in Africa 04:03 Zimbabwe seems years away from reintroducing its own currency. In the meantime, it has coins called bonds. For each coin in circulation there's an equivalent U.S. dollar coin held in reserves. There are over $13 million worth of these coins in the country, CNN was told, but recently banks have started printing "bond notes" representing U.S. dollar values up to $20, due to a cash shortage. From The 'worthless' 100 trillion dollar bank note - CNN.com xxx

xxx According to some other forecasts, wearable payment transaction volume will grow from $3.1 billion in 2015 to $501.1 billion worldwide by 2020. By that time, wearable payments will represent approximately 20% of the total mobile proximity transaction volume and about 1% of total cashless transactions in retail. From What is The Next Big Thing in Payments? | Let's Talk Payments xxx

xxx The mining of bitcoin is a security service that alone creates no wealth From Bitcoin and the costs of consumption - Dr. Craig Wright xxx

xxx ECB has decided to discontinue production and issuance of €500 banknote From ECB ends production and issuance of €500 banknote xxx

My good friend Wendy Goodman was kind enough to write about her experiences at Tomorrow’s Transactions this year (our 19th annual Forum!!) referring to it as Tomorrow's Transactions Forum, Dave Birch's quirky annual event where ideas about the future of money are smashed together like particles to see what happens. From  net.wars: The blockchain menu xxx

xxx there is no reason why, in principle, central banks could not offer online digital money accounts for the public From MacroMania: Monetary policy implications of blockchain technology This is, essentially, what the first central bank did. The Bank of Amsterdam (the Amsterdamsche Wisselbank, founded in 1609) was, essentially, a municipal bank that provided a reliable and trusted payment mechanism. It did not lend money: it was there to make account-to-account ledger transfers. It had an important difference to previous experiments in the same direction: legal restrictions on settlement outside of the bank. The Amsterdam merchants were forced to open accounts there because of the law demanding that commercial payments had to be through the bank. They could deposit all sorts of different coins to credit their accounts and then make payments by instructing account-to-account transfers. The result was that Amsterdam supported a vibrant commercial marketplace with access to safe, ef...

xxx Turkey has gone live with its own card payment system, dubbed Troy, as it seeks to boost electronic money and usher in a cashless society by 2023. From Turkey launches national payments system xxx

xxx solarisBank, formed by the fintech startup incubator FinLeap, announced it had been granted a banking license by regulators in Germany, enabling it to offer fintech companies things like account and transaction services, compliance and trust solutions, working capital financing and online loans. It is essentially banking as a service From 'Banking as a Service' for Fintechs Seeking Scale | American Banker xxx

xxx the company’s co-founder and chief technology officer revealed that in 2016 Airbnb would be looking into blockchain integration, or a similar distributed ledger system, to authenticate a user’s reputation and establish trust on the platform. From What Airbnb’s blockchain proposal means for privacy xxx