Bitcoin News and Price | Bitcoin.News

Bank of England Tests DLT Settlement System

by Blockchain NewsApril 20, 2023

The Bank of England and the Bank for International Settlements (BIS) Innovation Hub London Center have successfully tested a distributed ledger technology-powered settlements system between the institutions. As a result, the Bank of England will use the insights from this project in its real-time gross settlement (RTGS) system.

The joint pilot project, called Project Meridian, was recently documented in a report published by BIS on April 19. The 44-page document highlighted the successful synchronization of distributed ledger technology (DLT) between the banks for the purchase of houses in Wales and England.

This synchronization network allowed for the transmission of messages between the synchronization network and RTGS system using APIs, providing a generic interface that could be “relatively easily” extended to other asset classes, such as foreign exchange. By extending this system to other asset classes, it could significantly reduce the time, costs, and risks of transactions.

The Bank of England and BIS have been exploring the potential of DLT for financial settlements and transaction processing for several years. They have been working on multiple projects, including a cross-border payments project called Project Stella, which was completed in 2019.

The Bank of England has also been developing its own RTGS system, which is set to be launched in 2022. The new system will be built on modern technology and will replace the current system, which has been in operation for almost 20 years. The integration of DLT technology into the new RTGS system could further enhance its efficiency and security.

DLT technology, also known as blockchain, has the potential to revolutionize the financial industry. Its decentralized and transparent nature allows for secure, efficient, and cost-effective transactions, without the need for intermediaries. It has the potential to streamline the financial system and reduce the risk of fraud and errors.

The successful completion of Project Meridian is a significant milestone in the exploration of DLT technology in financial settlements. The potential for extending the system to other asset classes could significantly enhance the efficiency and security of financial transactions, which would benefit the entire industry.

In conclusion, the Bank of England and BIS Innovation Hub London Center have successfully tested a DLT-powered settlements system through Project Meridian. The synchronization network allowed for the transmission of messages between the synchronization network and RTGS system using APIs, which could be extended to other asset classes, reducing the time, costs, and risks of transactions. This is a significant milestone in the exploration of DLT technology in financial settlements and could enhance the efficiency and security of financial transactions in the future.

Source

HSBC approves multi-million-pound bonuses for Silicon Valley Bank UK staff

by Blockchain NewsMarch 19, 2023

On March 10, the activities of Silicon Valley Bank UK were terminated by order of the Bank of England (BoE), which said that the bank did not provide any “critical services” in support of the financial system. Once this event occurred, HSBC purchased the bank for the very cheap price of one pound. But, just a few days following the purchase, HSBC gave its approval for bonuses of several millions of pounds to be given to workers and top executives of Silicon Valley Bank UK.

It was emphasized by the sources that the bonuses would not have been paid out if Silicon Valley Bank UK had not been purchased in a financially sound manner. The exact amounts of the bonuses that were given to Erin Platts, CEO of Silicon Valley Bank UK, and her senior colleagues are unknown at this time; however, insiders have emphasized that the payments were a signal of HSBC’s confidence in the talent base at Silicon Valley Bank UK as well as an effort to retain key staff.

As a result of the BoE’s announcement that it intends to place Silicon Valley Bank UK into a “bank insolvency procedure,” the bank was required to cease making payments and accepting deposits. Prior to this, Silicon Valley Bank UK was instrumental in the growth and support of the innovative economy in the UK. In the meanwhile, the United States banking arm of Silicon Valley Bank has been taken over by the government. In the meantime, Silicon Valley Bank’s parent company, SVB Financial Group, has filed for protection under Chapter 11 bankruptcy while it searches for purchasers for its other assets.

SVB Group’s chief restructuring officer William Kosturos stated that the Chapter 11 process will allow the group to “preserve value” as it evaluates strategic alternatives for its prized businesses and assets. Kosturos stated that the group will be able to “preserve value” if it goes through with the process. Notwithstanding this, both SVB Capital and SVB Securities will continue to do business as usual, both under the direction of their own separate teams.

Source

Tagged : Acquisition / Bank Of England / Bonuses / Hsbc / News / SILICON VALLEY BANK UK

Bank of England halts Silicon Valley Bank UK branch operations

by Blockchain NewsMarch 12, 2023

The Bank of England (BoE) has stopped the operations of Silicon Valley Bank’s United Kingdom branch (SVB U.K.), citing its limited presence and no critical functions supporting the financial system. On March 10, the BoE declared that SVB U.K. would no longer be accepting deposits or making payments and that it would be placed into a Bank Insolvency Procedure. The decision followed the closure of SVB by the California Department of Financial Protection and Innovation.

The BoE explained that a bank insolvency procedure would enable eligible depositors to receive payments up to the protected limit of £85,000 or up to £170,000 for joint accounts through the Financial Services Compensation Scheme as quickly as possible. Bank liquidators would manage the remaining assets and liabilities of SVB U.K. during its insolvency proceedings, with any recoveries distributed to its creditors.

The announcement has raised concerns among several UK venture capitalists (VCs), who have expressed their support for SVB U.K. Index Ventures and Atomico issued a joint statement on March 12 endorsing SVB U.K., describing it as a trusted and valued partner that plays a pivotal role in supporting startups in the UK. The Coalition for a Digital Economy, a UK nonprofit that campaigns for policies to support digital startups, stated on March 11 that a large number of startups and investors in the ecosystem have significant exposure to SVB U.K. and will be very concerned.

Meanwhile, a Castle Hill report published on March 11 revealed that prominent blockchain VCs have over $6 billion in assets at the now-defunct bank. This includes $2.85 billion from Andreessen Horowitz, $1.72 billion from Paradigm, and $560 million from Pantera Capital.

The closure of SVB U.K. will have significant repercussions for startups and investors who have relied on the bank for financial services. Several prominent blockchain VCs have a substantial amount of assets at the bank, and their exposure to the insolvency proceedings could have a severe impact on the blockchain ecosystem. The closure also highlights the potential risks associated with relying on banks with limited operations and no critical functions in the financial system.

Source

Tagged : BANK INSOLVENCY PROCEDURE / Bank Of England / FINANCIAL SERVICES COMPENSATION SCHEME / News / SILICON VALLEY BANK UK / VENTURE CAPITALISTS

UK’s Bank Regulator to Propose Rules for Digital Asset Issuance

by Blockchain NewsMarch 5, 2023

The United Kingdom’s Prudential Regulatory Authority (PRA) has announced plans to propose a set of rules for the issuance and holding of digital assets. The decision comes as the use of digital assets continues to grow and evolve globally, and the PRA aims to ensure that banks and other financial institutions operating in the UK can do so safely and securely.

The proposal will be developed in accordance with the Basel III rules, a global regulatory framework for banking institutions, as well as the Financial Services and Markets (FSM) bill currently under consideration by the UK Parliament. This ensures that the UK’s regulatory framework is aligned with international standards and is comprehensive in its approach to managing digital assets.

Vicky Saporta, executive director of the Prudential Policy Directorate at the Bank of England, made the announcement in a speech delivered at the bank on February 27. Saporta emphasized that the PRA’s goal is to develop a regulatory framework that is proportionate to the risks associated with digital assets while remaining flexible enough to adapt to the rapidly changing market.

The proposed rules are expected to address a range of issues related to digital assets, including custody, governance, risk management, and disclosure requirements. The PRA’s approach will be informed by ongoing discussions with industry stakeholders and other regulatory bodies, as well as by best practices observed in other jurisdictions.

This move by the PRA represents a significant step forward in the regulation of digital assets in the UK. While digital assets have been gaining popularity in recent years, there has been little regulatory oversight, leading to concerns about investor protection and financial stability. The proposed rules will help to address these concerns and provide greater clarity and certainty for financial institutions operating in the UK.

In addition to the proposed rules from the PRA, the UK government has been taking steps to enhance its regulatory framework for digital assets. The Financial Conduct Authority (FCA), the UK’s financial regulator, has implemented a registration scheme for cryptocurrency firms operating in the country, and is considering additional measures to enhance investor protection and market integrity.

Overall, the UK’s approach to regulating digital assets is reflective of a broader global trend towards greater regulatory oversight. As digital assets continue to evolve and become more mainstream, it is likely that regulatory frameworks will continue to evolve as well, with the aim of promoting investor protection and financial stability while supporting innovation and growth in the sector.

Source

Tagged : Bank Of England / BASEL III RULES / DIGITAL ASSETS / FINANCIAL SERVICES BILL / News / UK BANK REGULATOR

UK lacks expertise for central bank digital currency

by Blockchain NewsMarch 4, 2023

The Bank of England (BoE) is unlikely to issue a central bank digital currency (CBDC) anytime soon due to a lack of technical expertise, according to Jon Cunliffe, the deputy governor. Speaking at a treasury select committee hearing, Cunliffe stated that there is a greater than 50% chance that the central bank will eventually issue a CBDC, but the institution is not yet ready to do so.

The UK has been exploring the possibility of a digital pound for several years, but the BoE has been cautious about moving forward with the initiative. The deputy governor explained that the next phase of development will involve partnering with the private sector to test a potential digital pound in a simulated environment. This will help the BoE gain the necessary expertise to build a working prototype and test it in a live environment.

While the BoE has been exploring the potential benefits and risks of a CBDC, the institution has also been monitoring developments in other countries. China, for example, has been working on its own digital currency, the digital yuan, which has already been tested in several pilot programs. The European Central Bank (ECB) has also been exploring the possibility of a digital euro, and has launched a public consultation on the matter.

The BoE is aware that the development of a CBDC would require significant investment in infrastructure and technology, as well as a thorough understanding of the potential risks and benefits. The institution has been consulting with stakeholders in the private sector and academia to ensure that it has access to the necessary expertise.

Cunliffe emphasized that the BoE is committed to exploring the potential of a digital pound, but that the institution is not yet ready to move forward with the development of a CBDC. The next phase of the initiative will be critical in terms of gaining the necessary expertise and testing the technology in a simulated environment. If successful, the BoE may eventually move forward with the development of a working prototype and, eventually, the implementation of a digital pound.

Source

Tagged : Bank Of England / Central Bank Digital Currency / Digital Pound / Expertise / News / UK

The United Kingdom Tax Reform Council Launches Campaign Against Bank of England

by Blockchain NewsFebruary 15, 2023

The United Kingdom Tax Reform Council has begun a campaign in opposition to the idea of the Bank of England to develop a digital currency that is controlled by the central bank (CBDC). The charitable organization issues a warning that such a step might pose a significant threat to the privacy of individuals and result in modifications to the taxation system that are too invasive.

On the advisory board of the recently established Tax Reform Council is monetary economist John Chown, who was also instrumental in the establishment of the Institute for Fiscal Studies. The Tax Reform Council is of the opinion that the implementation of a CBDC would result in an increase in the level of government monitoring, a larger level of intrusion by tax officials, and an increased danger of cyberattacks on the monetary system of the country.

The think tank is concerned about the same things as the Bitcoin (BTC) community in the United Kingdom, which has been quite outspoken about its opposition to CBDCs.

The co-founder of the Bitcoin Collective in the United Kingdom, Jordan Walker, said that “the deployment of CBDCs in the United Kingdom is risky on a number of fronts.” If we did this, the government and the central bank would have a greater degree of influence over our monetary system.

“This binds the monetary system even closer to the political system, which is a system that has produced big issues in the past and that continues to bring considerable problems in the present. Instead, we need to make it our goal to keep money and politics completely distinct.

“the choice of the Bank of England to pursue a British CBDC poses a number of very significant issues,” as noted by the advisory board economists, who include Patrick Minford, Julian Jessop, and Chown. The goal of the organization is to educate people about the potential for “greater government monitoring” offered by CBDCs.

CBDCs make the claim that they can improve financial inclusion, lower costs for both firms and consumers, and boost consumer and employee safety. Bitcoin, on the other hand, already provides these benefits and many more: By passing the Bitcoin legislation, El Salvador was able to bank large portions of its population, and Bitcoin also gives a path to freedom for those who are now living in oppressive regimes.

Both the Treasury and the Bank of England in the United Kingdom have been conducting recruitment for CBDC posts. In spite of opposition from the wider crypto community, the Bank of England has emphasized the “need” to develop a digital counterpart of the British pound.

According to the Tax Reform Council, every personal transaction carried out with the use of a CBDC would be logged on the private blockchain ledger maintained by the Bank of England. This would provide the tax collector with unparalleled access to the individuals’ financial histories. According to the press release, this is something that has already begun to occur in China with the renminbi CBDC.

Walker raised the alarm, stating, “I believe we are closer to the rollout than many realize, and until we have more education around this issue, we’ll see many individuals in this nation become dragged into this computerized monetary tyranny without ever realizing it.”

Source

Tagged : Bank Of England / Bitcoin Community / Business / CBDC / News / United Kingdom

The UK is a step closer to launching a central bank digital currency

by Blockchain NewsFebruary 9, 2023

After the publication of a consultation document that explains the planned digital pound, which the general public has dubbed “Britcoin,” the United Kingdom is one step closer to creating a central bank digital currency (CBDC).

The Bank of England (BoE) and the United Kingdom Treasury both contributed to the publication of the 116-page consultation document on February 7th. In addition to that, a technology working paper that delves into the technical as well as economic design issues was published.

CBDCs such as the digital pound may co-exist in what the authors of the article believe to be a “mixed payments economy,” despite the increase of privately-issued stablecoins over the last few years, according to the findings of the paper.

“The digital pound does not need to be the predominate form of money in order to accomplish its public policy aims in the same way that cash coexists alongside private money. It is possible that the digital pound will coexist with other types of currency, such as stablecoins.

Although the Bank of England (BoE) and the Treasury Department (Treasury) have expressed optimism that a digital version of the pound would be introduced by 2025 “at the earliest,” they are not yet one hundred percent positive that this will really occur.

According to the report, “The Bank and HM Treasury assess it is likely to be necessary in the UK to have a digital pound,” however there is currently no decision that can be made to adopt such a currency.

According to the paper, the primary objective behind the launch of the digital pound is to “promote innovation, choice, and efficiency in domestic payments” and to ensure that the money issued by the central bank of the United Kingdom continues to serve as “an anchor for confidence and safety” in the monetary system of the country.

“For the digital pound to play the role that cash plays in anchoring the monetary system, it needs to be usable and sufficient adopted by households and businesses,” this quote from the Financial Times reads. “For the digital pound to play the role that cash plays in anchoring the monetary system, it needs to be usable and sufficient adopted by households and businesses.”

Users will have access to e-GBP after they have established a connection to an API that is managed by the private sector and that, in turn, links to the core ledger.

Additional programmability capabilities, including as smart contracts and atomic swaps, which make it possible for assets to be moved across networks, will be made available.

Source

Tagged : Adoption / Altcoin / Bank Of England / Blockchain / Business / CBDC / Central Bank / News / Regulation / Report / Stablecoin / Uk Government

The Bank of England and the United Kingdom’s Treasury are working on a digital asset

by Blockchain NewsFebruary 8, 2023

The Bank of England (BoE) and the Treasury of the United Kingdom are moving on with plans to establish a digital currency that might “offer a new method to pay” without necessarily replacing cash. These ideas are in the early stages.

A joint consultation paper on central bank digital currencies (CBDCs) is scheduled to be released on February 7, with the Bank of England and the Treasury seeking views on how and if they should continue with establishing a CBDC. The topic of the document is central bank digital currencies (CBDCs).

Jeremy Hunt, the Minister of Finance, made an announcement to the public on February 6 indicating that the two organizations will collaborate in an effort to build a modernized digital payments system that does not necessarily exclude the usage of cash.

“While cash is here to stay, a digital pound issued and backed by the Bank of England could be a new way to pay that is trusted, accessible, and easy to use,” he said. He continued by saying that “we want to investigate what is possible first, while always making sure that we protect financial stability.”

Officials from the Bank of England and the Treasury Department anticipate that large technology firms will provide a government-backed alternative to privately produced stablecoins over the next few years. This will be another significant area of attention that will be addressed.

As part of the statement, Governor of the Bank of England Andrew Bailey highlighted the fact that a “digital pound would enable a new method to pay, benefit companies, retain faith in money, and better safeguard financial stability.”

“However, there are a number of ramifications that will need to be thoroughly considered by our technical work. This consultation, together with the further work that will be done by the bank at this time, will provide the groundwork for what would be a major choice for the nation about the manner in which we use money.

A speech by BoE Deputy Governor Jon Cunliffe is also scheduled to take place on February 7. The purpose of this address is to provide the financial sector with an update on the central bank and Treasury’s CBDC work to far.

It was proposed that even if they choose to continue ahead with the project, the construction of the blockchain-based infrastructure that would support the digital pound would not take place until at least the year 2025.

Related: According to new study, London has become the world’s most crypto-ready city for commercial use.

Rishi Sunak, the current prime minister and a former finance minister, issued an order in April 2021 mandating that the Bank of England and the Treasury work together to establish the Central Bank Digital Currency Taskforce. The two individuals are essentially entrusted with supervising the investigation as well as the possible deployment of the digital pound.

Although it seems to have been a slow burn so far, given how cautious the BoE and Treasury’s stances are, the latter did post a job listing to LinkedIn on January 24 calling for a team lead for its Payments and Fintech Team of approximately 20 people focused exploring on a “potential digital pound.” Despite the fact that it appears to have been a slow burn so far, given how cautious the BoE and Treasury’s stances are, the Treasury did post the job listing.

Source

Tagged : Bank Of England / CBDC / Central Bank / News / Regulation

U.K. Central Bank and Treasury Believe Digital Pound is Needed

by Blockchain NewsFebruary 5, 2023

According to a story that was published by the Daily Telegraph on February 4, the Bank of England (BoE) and His Majesty’s Treasury feel that it is possible that the United Kingdom will need to develop a central bank digital currency (CBDC) by the year 2030.

According to a source inside the administration who spoke to the publication, the “digital pound” blueprint is going to be unveiled the following week. On February 7th, Deputy Governor Jon Cunliffe is going to provide an update on the work that the BoE has been doing on the CBDC.

The Governor of the Bank of England, Andrew Bailey, and the Chancellor of the Exchequer, Jeremy Hunt, were quoted in the Telegraph as saying that they believe it is likely that a digital version of the pound will be required in the future. This conclusion was reached on the basis of the work that has been done up until this point.

The Bank of England did not comment on the report but did say that a joint consultation about the digital pound will be made available in the near future.

It was reported that cash and coin payments in the United Kingdom dropped by 35% in the year 2020. About one payment out of every six is made with cash, while the other five are made using debit and credit cards. A digital currency produced by a central bank is a digital representation of government-issued money that is pegged to fiat reserves on a one-to-one basis.

The announcement was made only a few days after HM Treasury published a job listing on LinkedIn advertising an open position for a head of central bank digital currency. The function was described as “important, complicated, and cross-cutting” in the job description, and it was said that it required “substantial involvement within and beyond the HM Treasury.”

The digital pound is only one of the numerous CBDCs that are anticipated to be implemented in different parts of the globe in the years to come. The European Central Bank has been debating the possibility of a digital version of the euro, and a number of other nations, notably Sweden and Denmark, are also looking into the possibility of adopting digital currencies.

Source

Tagged : Adoption / Bank Of England / CBDC / News / Regulation / United Kingdom

BoE’s Committee Recommends Taking a Closer Look on Crypto Regulation

by Blockchain NewsJuly 6, 2022

In its latest Financial Stability Report, the Financial Planning Committee (FPC), an offshoot of the Bank of England has recommended pushing for an ‘enhanced’ regulatory framework.

According to the FPC, the obvious vulnerabilities that are being exhibited by the nascent industry are not posing an immediate threat to the broader financial ecosystem.

Nonetheless, the report hightlighted the need to keep a close watch on cryptocurrencies as the perceived vulnerabilities are notably close to those experienced by mainstream traditional financial players.

As identified, the FPC said these vulnerabilities include “liquidity mismatches leading to run dynamics and fire sales, and leveraged positions being unwound and amplifying price falls. Investor confidence in the ability of certain so-called ‘stablecoins’ to maintain their pegs was weakened significantly, particularly those with no or riskier backing assets and lower transparency.”

“On liquidity mismatches, we can agree that the recommendations of the FPC are largely genuine as current events point out. We have seen the liquidation of one of the biggest and most established hedge funds in the cryptocurrency ecosystem, Three Arrows Capital as ordered by a Court of Law in the British Virgin Islands where the firm operates from.”

The amplifying price falls were reflected by the collapse of the Terra-LUNA coin which shed off more than 99.9% of its price within a week back in May. Alongside its sister stablecoin, UST which was depegged from its $1 peg, the FPC specifically singled out stablecoins as the report noted that “some stablecoins held to be used for payments may not offer similar protections to the central bank or commercial bank money.”

While the United Kingdom is doing all it can to align its approach toward regulating stablecoins, the European Union has drawn a framework for stablecoins in its Markets in Crypto Assets (MiCA) bill passed last week. Japan has also passed a law to regulate stablecoins, a move that shows global regulators are no longer sleeping on their oars with respect to these asset classes.

Image source: Shutterstock

Source

Tagged : Bank Of England / Boe / Regulation / Stablecoins