BIS builds out “game-changing” blueprint for the future monetary and financial system

The Bank for International Settlements (BIS) is set to redefine the global financial landscape with its newly released blueprint for a futuristic monetary system. Harnessing programmable central bank money, this novel infrastructure aims to bridge the gap between tokenised commercial bank assets and real-time transactions.

The blueprint, highlighted in a special chapter of the BIS Annual Economic Report 2023, brings a whole new meaning to financial transactions and economic arrangements, potentially revolutionising the global monetary system. By integrating tokenised forms of central bank digital currency (CBDC) with commercial bank deposits and other tokenised assets, the new design opens up an era of boundless possibilities for both economic and monetary system evolution.

“We are at the cusp of another major leap in the monetary and financial system, which will have far-reaching consequences for the economy and society at large,” says Hyun Song Shin, Economic Adviser and Head of Research of the BIS. According to Shin, this innovation is a game-changer, pushing the boundaries of traditional transactions.

This proposed infrastructure will deliver more than speed and cost efficiency. It will foster a wave of innovation enabling transactions that were previously inconceivable, limited only by the ingenuity of public and private sector innovators.

The envisioned improvements include streamlined securities settlements, tokenised deposits with in-built regulatory checks, and smart contract-enabled credit aimed at reducing trade finance costs for smaller firms. Furthermore, using privacy-protecting technology to share data on potential borrowers could broaden credit access to underprivileged segments of the society.

In collaboration with other public authorities and the private sector, central banks worldwide are eager to explore the possibilities offered by this new monetary system, seeking to enhance cross-border integration. The BIS continues to lend its support to these endeavors, fulfilling its role as a hub for international cooperation and innovation among central banks.

Further details of the blueprint will be available in the full BIS Annual Economic Report and the BIS Annual Report scheduled for release on 25 June.


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EDX Markets Debuts Cryptocurrency Trading Platform and Wraps Up Latest Investment Round

In a key milestone, EDX Markets has successfully kick-started its cryptocurrency trading operations and completed a fresh funding round. Based in Hoboken, New Jersey, EDX has been established as a trusted marketplace for digital assets, promoting safe and compliant trading through reliable intermediaries.

EDX has garnered the attention of major financial institutions, becoming the preferred cryptocurrency marketplace for industry leaders. The platform stands out with its non-custodial model designed to prevent conflicts of interest. It also offers benefits like enhanced liquidity, competitive quotes, and a retail-only quote, giving retail-originated orders a better pricing advantage. Currently, EDX supports the trading of well-known cryptocurrencies (mainly POW), including Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Bitcoin Cash (BCH).

Another milestone is on the horizon for EDX. Later this year, it plans to launch a clearinghouse, EDX Clearing, which will settle trades matched on EDX Markets. The clearinghouse will function as a central counterparty for trades, reducing settlement risks, promoting price competition, and increasing operational efficiency.

The launch of EDX and the forthcoming EDX Clearing comes on the heels of a successful new funding round. The round saw participation from strategic investors such as Miami International Holdings, DV Crypto, GTS, GSR Markets LTD, and HRT Technology. These firms join the platform’s founding investors, including heavyweights like Charles Schwab, Citadel Securities, Fidelity Digital AssetsSM, Paradigm, Sequoia Capital, and Virtu Financial. The newly secured funding will bolster the ongoing development of EDX’s trading platform and strengthen its market leadership position.

Jamil Nazarali, CEO of EDX, expressed his confidence in the platform’s potential and its ability to attract investors. He stressed EDX’s commitment to incorporating the best practices from traditional finance into the cryptocurrency market and hinted at the significant edge EDX Clearing will provide by improving competition and operational efficiency.


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Binance Announces Integration of Bitcoin Lightning Network for Enhanced Transaction Efficiency

Cryptocurrency exchange giant Binance has announced its plans to integrate the Bitcoin Lightning Network for deposits and withdrawals. The move aims to improve transaction efficiency and provide users with a faster and more cost-effective experience.

The news broke when some observant users noticed the presence of new lightning nodes, which were later confirmed by Binance to be their own. This revelation created a buzz among the cryptocurrency community, generating anticipation for the forthcoming integration.

By leveraging Bitcoin Lightning Network, Binance users can expect quicker transactions and lower fees without compromising the integrity of the underlying network. This innovative solution offers a promising avenue to address the scalability concerns associated with the Bitcoin network.

Despite the exciting progress, Binance acknowledges that there is still further technical work to be completed before the Lightning Network can be fully integrated. However, the exchange has assured users that it will provide timely updates on the integration process, ensuring transparency and open communication with its community.

The integration of the Lightning Network aligns with Binance’s commitment to enhancing user experience and optimizing its platform’s functionality. By implementing this cutting-edge technology, Binance aims to offer a seamless and efficient trading experience for its customers.

With Binance’s integration of the Bitcoin Lightning Network on the horizon, cryptocurrency enthusiasts eagerly anticipate the prospect of faster transactions and reduced fees. 

The Bitcoin Lightning Network is a second-layer protocol designed to address scalability issues and enhance transaction efficiency on the Bitcoin blockchain. It functions as an overlay network built on top of the existing Bitcoin blockchain, enabling faster and cheaper transactions. The primary goal of the Lightning Network is to facilitate instant microtransactions while reducing transaction fees. It achieves this by creating payment channels between users, which are essentially off-chain channels for conducting transactions. These channels enable users to transact directly with each other without requiring every transaction to be recorded on the Bitcoin blockchain.


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Crypto Lending Platform Sandbank Temporarily Suspends New Deposits and Investment Features in Response to Crypto Market Challenges

Sandbank, a leading crypto lending and investment platform, has announced its temporary suspension of new deposits and investment features in response to the challenges and uncertainties prevailing in the crypto market. The platform aims to ensure a secure environment for users to engage in their investment activities.

In recent times, numerous crypto companies have encountered serious challenges due to tightening regulations and inherent flaws in their business models. Just a few days ago, Delio and Haru Invest, two Korea-related crypto lender platforms, halted their withdrawal services. It is worth noting that Delio is a regulated entity holding both Korea’s Virtual Asset Service Provider (VASP) and the USA’s Money Services Business (MSB) licenses.

Despite the tumultuous climate, Sandbank claims to reassure its users by affirming the uninterrupted availability of its withdrawal and asset management functions. The platform remains committed to supporting its users in maintaining a healthy and prosperous crypto investment journey. Sandbank pledges to uphold the highest standards of service and will continue to assist customers throughout their investment endeavors.


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Hong Kong’s Ambition to Thrive in Web3: Exploring the Development of Selected Regional Web 3.0 Technologies

Hong Kong is actively involved in Web3 and aims to become a global center for digital assets. Recently, the Research Unit of the Legislative Council Secretariat of Hong Kong released a summary of the document titled ‘Development of Selected Regional Web 3.0 Technologies.

According to the summary, the Hong Kong government is actively promoting the development and application of Web 3.0. In the 2023-2024 fiscal budget, the Financial Secretary announced accelerated efforts to build Hong Kong’s Web 3.0 ecosystem and the establishment of a dedicated development task force for virtual assets.

However, concerns have been raised about Hong Kong’s slower development compared to other regions. Various global regions, particularly in Asia and the Gulf region, have implemented measures to expedite the development of Web 3.0 and related technologies and applications.

It is suggested that Hong Kong should not limit its focus to financial services and virtual assets but actively promote innovation in other Web 3.0 technology areas, such as blockchain and metaverse technology.

Responding to a request from Councilor Wu Kit Ching, the research group has studied leading regions in Web 3.0 technology and application development and examined their strategies.

The research primarily focuses on Japan, Singapore, South Korea, and the United Arab Emirates (UAE) as these regions have demonstrated proactive approaches in developing Web 3.0 technologies and have become global or regional innovation hubs. Japan has established high-level policy guidance and dedicated offices to coordinate Web 3.0 policies across government departments.

Other regions covered in the study concentrate on developing specific areas of Web 3.0. For example, Singapore and the UAE are exploring blockchain technology through industry collaborations and establishing incubation centers, while South Korea is actively launching metaverse strategies to foster innovation across various sectors.

The summary also provides an overview of the main characteristics, foundational technologies, and applications of Web 3.0. It outlines recent developments in Web 3.0 in Hong Kong and analyzes the development scenarios of selected regions, including Japan’s comprehensive approach and other regions’ application-focused initiatives.

It highlights that Web 3.0 represents a decentralized network that empowers users with greater autonomy and control over their digital lives. While Hong Kong’s government has introduced measures to support the development of the Web 3.0 ecosystem, particularly in the virtual asset market and related financial services, concerns remain regarding Hong Kong’s slower development in other areas of Web 3.0 technology compared to its counterparts in Asia and the Gulf region. These regions are leveraging their advantages and exploring wider applications of Web 3.0.


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