Snippets

Now, of course, when techno-determinist mirrorshaded hypester commentators (eg, me) say that the future of money might be somewhat different to the Bretton Woods II structure and that perhaps the decentralising nature of computer, communications and cryptographic (CCC) together mean that there might be currency issuers other than central banks (as, for example, I did in Wired magazine two decades ago), this might be dismissed by scenario planners and strategists as cypherpunk-addled babble. It seems to me, however, that the reflections of sensible, knowledgable and powerful players is tending int the same direction. Mark Carney, governor of the Bank of England, recently gave a speech at Jackson Hole, Wyoming, in which he said that [ Central Banking ] a form of global digital currency could be "the answer to the destabilising dominance of the US dollar in today’s global monetary system”. Wow. Mr. Carney went on to talk about the idea of “synthetic hegemonic currency” (abbreviate...

xxx "HSBC UK customers can request a national sort code that cannot be traced to a particular bank branch, if they are concerned an abuser could use these details to find out their location." From "'The bank sent my safe house address to my abusive ex' - BBC News" . xxx

xxx "To understand this let’s take an analogy. Imagine that SCA in face to face commerce had been mandated on banks, but no technological solution was provided. Instead of chip and PIN each bank created its own solution such that every time a consumer approached a PoS device the authentication method they used would be dependent on which bank they chose to interact with. Can we imagine the confusion on adoption day? But this is, in essence, the experience that has been regulated into existence with PSD2 in on-line commerce. The problem is even worse for third-parties trying to build a business using the PSD2 APIs – because in the middle of their smooth, optimised customer journey their customers are redirected to a bank SCA experience which can vary dramatically in terms of friction and user experience. To solve this the regulators need to take a step back, temporarily drop anti-competition laws and insist that banks come up with a minimum standard for SCA in online commerce, s...

xxx "To address the leakage, Russia built two huge data centres and legislated so that companies had to submit every invoice between businesses. It also mandated every retailer to buy new cash registers that were linked securely and directly to the data centres." From "Russia’s role in producing the taxman of the future | Financial Times" . xxx

xxx "Apple’s VP of Apple Pay Jennifer Bailey today announced a new NFC feature for iPhone: special tags that trigger Apple Pay purchases when tapped" From "Apple announces support for Apple Pay NFC stickers, partners with Bird scooters and more - 9to5Mac" . Alternative to QR coes

xxx "‘It’s easier to order there,’ she motioned to self-ordering kiosks that accept credit cards." From "Cashless SF stores now must take cash: ‘They’re not making it easy’ - SFChronicle.com" . xxx

xxx "Brick-and-mortar businesses, a.k.a. 'any place of business operating at a fixed, permanent physical premises,' must accept cash in San Francisco. They may not charge a fee or place any other conditions on its acceptance of cash." From "SF 'Cashless Ban' FAQ: How to pay cash at Amazon Go, and more questions answered - SFGate" . xxx

xxx Financial hegemony has been indulged for a long time. Groups with first-mover advantage have been enjoying the monopoly benefits brought by financial hegemony. The strong are strong and strong; while more regions and individuals often pay a lot of hard work, but they are just making wedding dresses for others. The weak are weak. Coin Hope hopes to use the technological innovation power given by the times to instigate a new currency journey and create an independent “regional version of Libra”, which we call “Venus”. From Coin Launches "Venus Plan" – Binance . xxx

xxx "In a typical election setting with secret ballots, we need: enforced secrecy: a way for each voter to cast a ballot secretly and no way to prove how they voted (lest they be unduly influenced) individual verifiability: a way for each voter to gain confidence that their own vote was correctly recorded and counted. global verifiability: a way for everyone to gain confidence that all votes were correctly counted and that only eligible voters cast a ballot." From "Blockchain and Voting – Benlog" . xxx

xxx "According to Nomura each new Apple Card user is costing Goldman around $350, which they estimate will take four years for the bank to recuperate those costs and start becoming profitable." From "Analysts report Goldman Sachs is paying around $350 for every Apple Card member | iMore" . xxx

xxx "Specifically, we highlight the potential for private digital currencies to improve welfare within an emerging market with a selfish government. In that setting, we demonstrate that a private digital currency not only improves citizen welfare but also encourages local investment and enhances government welfare." From "How Do Private Digital Currencies Affect Government Policy? by Max Raskin, Fahad Saleh, David Yermack :: SSRN" . xxx

xxx "Most people also still need to bring their IDs in the wallets when driving (or going out). Government-issued identification will probably be the most difficult thing in the wallet to digitize" From "Apple is going to be the company that kills the wallet — Quartz" . xxx

xxx "In June the Financial Action Task Force (FATF; pronounced ‘fat F’) published a much anticipated, technically nonbinding guidance detailing expectations of how its 37 member jurisdictions should regulate their respective ‘virtual asset’ marketplaces. Here’s the contentious part: whenever a user of one exchange sends cryptocurrency worth more than 1,000 dollars or euros to a user of a different exchange, the originating exchange must ‘immediately and securely’ share identifying information about both the sender and the intended recipient with the beneficiary exchange. That information should also be made available to ‘appropriate authorities on request.’" From "New Guidelines Significantly Impacting Cryptocurrecy Exchanges | PaymentsJournal" . xxx

Perhaps we should be more optimistic though, as a raise a more knowing, media-savvy generation. According Harper’s Index for April 2019, Americans over 65 are seven times more likely to share stories from fake news sites than those aged between 18 and 29.

Biometrics are Best Why am I so keen on biometrics for SSCA? Well, let me take you back to what I wrote about the launch of the iPhone 5 with TouchID (which was, of course, always a misleading label: it should be called TouchAuthenticate, but more on this later). Here’s an amalgam of the conversations I had with different people following that 2013 announcement: Person : Do you know that fingerprints can be faked? I heard about a Japanese guy who did it with jelly babies or something? Me : Yes, I know . Person : Your fingerprints are all over your phone, people could easily steal them. Me : Yes, I know . Person : Criminals might be able to find a way to make a fake finger and use it to buy songs on iTunes using your iPhone. Me : Yes, I know . Person : Do you know that researchers were able to reconstruct useable 3D models of fingers by accessing stored fingerprint templates? Me : Yes, I know . Person : So would you use the new Apple TouchID on your next iPhone? Me : Of cours...

xxx The use of unique mobile identifier services will put more than $7 billion into the pockets of mobile operators in 2024, according to a new estimate from Juniper Research. From Mobile ID Services Expected To Enrich Mobile Operators 08/13/2019 . xxx

xxx The most valuable part of the Verify system, as far as the remaining IDPs are concerned, is the Document Checking Service (DCS), a tool that allows them to check a user’s passport or driving licence against data held by HM Passport Office (HMPO) and the Driver and Vehicle Licensing Agency (DVLA). From Why Gov.uk Verify faces a critical few months - again - Computer Weekly Editor's Blog . xxx

I always enjoy reading The Economist’s Science and Technology section. Generally speaking, I find most of the articles interesting, even if they are not practically relevant to anything and I am working on. In a recent edition (27th of July) however I found the piece that absolutely fascinated me. Nothing to do with computers, or electronic money or digital identity. It was this piece about lenses.  xxx  For a group of engineers at Columbia University, in New York, led by Nanfang Yu, has worked out how to make magnifying lenses that are flat, and thinner than a hair. From How to make a flat lens - The seed of light .  The invention of microscopically thin flat lenses that can be manufactured using the same nano lithographic techniques are used to making computer chips opens up all sorts of new technological advances in everything from cameras and contact lenses to microscopes and, of course, smart spectacles.   It can do this because its surface is covered with millions of tiny...

Amongst the voices calling for something to be done about the lack of a digital identity infrastructure (voices that include, for example, mine and Mark Carney’s) is that of the former Prime Minister Tony Blair who has called for " a proper identity system in the UK " to underpin digital government. I’m not sure what he means by “proper” but I’ll take it to mean well-thought out, practical and effective. You may recall that the national identity card scheme introduced under Mr. Blair (the “ PA card ”) was none of these things. xxx As the clock ticks down towards the end of March 2020, when further public investment in Verify ceases and the system is taken on by the private sector, significant questions remain over the viability of Verify. From Why Gov.uk Verify faces a critical few months - again - Computer Weekly Editor's Blog .   xxx I wonder why things will be any different this time? Suppose the outcome of the current government’s consultation on digital ident...

xxx “In this industry, you got clubs. You got bottles. You got models. You have strippers,” [Mr. Floyd “A1” Bentley] said. “They want to get paid right away, and they really don’t be wanting them checks.” From Rap Music Ditches Dollars for the Cash App Mobile Payment System - WSJ . I really don’t be wanting them cheques either, and it drives me crazy when US companies insist on paying using this ridiculous antiquated and inconvenient medieval mechanism. My heart sinks when I open the mail and find a cheque. It’s like finding out you’ve got some homework to do.

xxx Floyd “A1” Bentley, a rapper and star of the VH1 reality show “Love & Hip-Hop Hollywood,” named a recent single “Cash App,” one of more than 100 songs currently on Spotify that have the payment method in their titles. Others include “Cash App Boomin,” “Cash App or Chill” and “What’s Ya Cash App.” From Rap Music Ditches Dollars for the Cash App Mobile Payment System - WSJ . xxx

xxx PBoC officials voiced worries that [Libra] could have destabilising effects on the financial system and stated the bank would step up its own efforts to create an e-currency. From PBoC sounds alarm over Facebook’s Libra - Central Banking . xxx

xxx The [Bundesbank] took a light-touch approach to digital currencies such as Libra… Other central banks, such as the People’s Bank of China, have been more hostile towards Facebook’s digital currency project. From Bundesbank takes light-touch approach to Libra - Central Banking . xxx

xxx But how will IBM, Mastercard, Microsoft, or anyone else initiate its own consumer-centric digital identity model if the consumer’s identity is already locked up tight inside the Apple ecosystem? From Uh-Oh! Is Apple Expanding the Restriction on NFC to Include Mobile Identity? . xxx

xxx Anyone expecting Apple to open up its infrastructure so that other financial institutions can deploy a similar provisioning process are deluding themselves. Apple will keep NFC locked up and will increasingly monetize the identity of Apple consumers all in the name of protecting them. From Uh-Oh! Is Apple Expanding the Restriction on NFC to Include Mobile Identity? . xxx

xxx Britons have called for the scrapping of 1p and 2p coins after it was revealed the Royal Mint made none last for the first time in nearly 50 years. From 'I throw them in the BIN!': Britons call for scrapping of 1p and 2p coins | Daily Mail Online . xxx

xxx As Apple has ramped up its privacy push, it has targeted Facebook From Facebook Hit by Apple’s Crackdown on Messaging Feature — The Information . xxx

xxx A majority (58%) of Australians are ‘somewhat concerned’ or ‘very concerned’ about biometric data being used to gain access to a licensed pub, club or hotel From Preventing another Australia Card fail | Australian Strategic Policy Institute | ASPI . xxx Checking into hotel in Canberra for Tech in Gov conf identity stream. Hotel: Do you mind if I take a copy of your driver's license? Me: I'd rather you didn't Hotel: Okay I'll just show it to the duty manager then Me: Great identity story for tomorrow. — Victoria Richardson (@victoriajane) August 5, 2019 xxx

xxx North Korea has generated an estimated $2 billion for its weapons of mass destruction programs using “widespread and increasingly sophisticated” cyberattacks to steal from banks and cryptocurrency exchanges, according to a confidential U.N. report seen by Reuters on Monday. From North Korea took $2 billion in cyberattacks to fund weapons program: U.N. report - Reuters . xxx

xxx The technology is already having an impact in unexpected ways. In April, the transportation payment app Tianfu Tong caused many tech-savvy commuters to be late for work in Chengdu when it stopped generating new QR codes. Commuters were forced to line up at ticketing machines to buy tickets like it was the 20th Century. From QR code payments make long commutes even longer in China | Abacus . xxx

xxx But as company vice president Alice Chan told Eater SF, they didn't found Zippin to squash Amazon Go directly. Instead, they want to sell their technology to potential Amazon Go competitors and spread the wealth. "We don't want to be a retailer opening a lot of stores, but our goal is to power other retailers," Chan explained to Eater SF. From Another checkout-free store opened in SF. Here's how it compares to Amazon. - SFGate . xxx

xxx BMW’s website now reveals that beginning with the 2019 model year, it’s turning the CarPlay interface between iPhones and the vehicle’s infotainment system into a subscription service. From How BMW’s new annual fee for Apple CarPlay could define the IoT | Network World . xxx

xxx The UK government's troubled £154m digital identity project Verify is to be flagged red by Whitehall's major projects watchdog, meaning delivery looks unachievable From Red flag: Verify to be marked 'undeliverable' by gov projects watchdog • The Register . xxx

xxx If checkable deposits become central bank liabilities, the loanable funds they provide will no longer be allocated by the competitive private banking system, but rather by the government, which is a recipe for inefficiency and cronyism. From Efficient "Central Bank Digital Currency" is a Fantasy - Alt-M . xxx

Aussie CDR The BIS Annual Review for 2019 touches on this, noting that "Another, newer type of risk is the anticompetitive use of data. Given their scale and technology, big techs have the ability to collect massive amounts of data at near zero cost. This gives rise to “digital monopolies” or “data-opolies”. The BIS go on to warn that big techs can exploit market domination to engage in price discrimination and extract rents. An example given is that they may use their data to identify the highest prices that customers will pay for different financial services. The concern stems from that fact that price discrimination does not just have distributional effects (ie, raising big techs’ profits at customers’ expense without changing the overall amounts produced and consumed) but could also have adverse economic and welfare effects. 

xxx The instruments of trade and finance are inventions, in the same way that creations of art and discoveries of science are inventions—products of the human imagination. From The Invention of Money | The New Yorker . xxx

xxx But, above all, there will be money to be made from the data generated by all these transactions; after all, data is currency, too. From Facebook’s Audacious Pitch for a Global Cryptocurrency | The New Yorker . xxx

xxx US and European banks are steering clear of Libra, Facebook’s project for a new cryptocurrency, for fear of antagonising regulators and cannibalising their own digital currency projects From Banks in no rush to join Facebook’s crypto project | Financial Times . xxx

xxx These problems have three remedies. First, governments need to ensure that central banks’ monopoly over coins and notes is not replaced by private monopolies over digital money. Rather than letting a few credit-card firms have a stranglehold on the electronic pipes for digital payments, as America may yet allow, governments must ensure the payments plumbing is open to a range of digital firms which can build services on top of it. They should urge banks to offer cheap, instant, bank-to-bank digital transfers between deposit accounts, as in Sweden and the Netherlands. Competition should keep prices low so that the poor can afford most services, and it should also mean that if one firm stumbles others can step in, making the system resilient. Second, governments should maintain banks’ obligation to keep customer information private, so that the plumbing remains anonymous. Digital firms that use this plumbing to offer services should be free to monetise transaction data, through, f...

The Bank of England’s excellent report on the future of finance, released earlier this year, has plenty to say about the Bank’s role in that future. To help finance serve the digital economy, the Bank should: Shape tomorrow’s payment system Our payment habits are shifting as we increasingly use our cards, phones and electronic wallets instead of cash. The underlying infrastructure will need to adapt to these changes. As these payment habits shift, we need a national payments strategy to improve our payments infrastructure and regulation. Bearing in mind what has happened in Sweden, where the slide into ceaselessness was not planned, we need a strategy which doesn’t leave anyone behind. This isn’t, of course, about the technology. Regulation also needs to be updated to reflect how risks are shifting within the payments system and to reduce complexity of that system. Enable innovation through modern financial infrastructure The next generation of financial firms will likely wide...