Tag: Financial Inclusion

BIS Survey: 93% of Central Banks Engaged in CBDCs, 15 Retail and 9 Wholesale CBDCs Expected by 2030

by Blockchain News

The Bank for International Settlements (BIS) has released a survey revealing that 93% of central banks are now engaged in some form of Central Bank Digital Currency (CBDC) work, with retail CBDCs taking the lead over wholesale CBDCs.

The survey, which gathered responses from 86 central banks, shows that over half of these institutions are not just exploring CBDCs but are conducting concrete experiments or working on pilots. The progress in retail CBDCs is more advanced, with almost a quarter of central banks piloting a retail CBDC.

The BIS survey also highlights the perceived value of CBDCs. More than 80% of central banks see potential benefits in having both a retail CBDC and a fast payment system (FPS). The unique properties and additional features that a retail CBDC can offer are seen as key advantages.

The emergence of cryptoassets and stablecoins has been a significant influence, accelerating CBDC work for nearly 60% of the respondent central banks. However, the survey also notes that stablecoins and other cryptoassets are rarely used for payments outside the crypto ecosystem.

The survey suggests that by 2030, we could see 15 retail and nine wholesale CBDCs in public circulation. This projection reflects the growing interest in digital currencies by central banks worldwide.

In terms of motivation, central banks in emerging market and developing economies (EMDEs) are more likely to be driven by financial inclusion-related motivations in their CBDC work. On the other hand, the desire to enhance cross-border payments primarily drives the work on wholesale CBDCs.

Currently, four central banks have issued a live retail CBDC: The Bahamas, the Eastern Caribbean, Jamaica, and Nigeria. This development marks a significant milestone in the global adoption of CBDCs.

The BIS survey provides a comprehensive overview of the current state of CBDC development and offers valuable insights into the future trajectory of digital currencies. As the exploration and experimentation with CBDCs continue, their role in the global financial system is set to become increasingly significant.

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Shapella Upgrade, Privacy Concerns, Hacks, and Financial Inclusion

by Blockchain News

The DeFi space had a busy week with several significant developments. The highly anticipated Shapella upgrade on Ethereum’s mainnet was successfully completed, allowing validators to withdraw their staked Ether after three years. However, only 253 validators have signed up to fully exit their staked Ether position, with analytics firm Glassnode predicting that less than 1% of the staked ETH will be withdrawn.

In addition to the Shapella upgrade, an Ethereum researcher revealed that staking Ether could become a privacy concern. The researcher found that staking Ether shows a user’s IP address information, which could lead to privacy issues. This discovery raised concerns within the cryptocurrency community.

A DeFi hack also occurred during the week, where a hacker exploited an old Yearn.finance contract and minted 1 quadrillion Yearn Tether (yUSDT). The hacker then swapped the yUSDT to other stablecoins, allowing them to take hold of $11.6 million worth of stablecoins.

However, the week also had positive news regarding financial inclusion in Africa. Fonbnk, a Web3 on-ramp that allows Africans to obtain cryptocurrency assets by exchanging their airtime credits, partnered with Tanda, a merchant network platform in East Africa, to launch an airtime trading marketplace across Tanda’s network of agents. This partnership aims to increase liquidity and earning opportunities for African micro-entrepreneurs.

Finally, the top 100 DeFi tokens had a bullish week, thanks to a late surge in the crypto market after Ethereum’s much-awaited upgrade. Most DeFi tokens traded in the green along with the rest of the market.

In conclusion, the DeFi space had a busy week with several significant developments, including the successful Shapella upgrade, privacy concerns related to staking, a major DeFi hack, and a partnership to increase financial inclusion in Africa. The top 100 DeFi tokens had a bullish week, and Glassnode predicted only a small percentage of staked ETH would be withdrawn.

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Fonbnk and Tanda Partner to Launch Airtime Trading Marketplace in East Africa

by Blockchain News

Web3 technology has brought about significant transformations in Africa, particularly in the realm of finance. Blockchain technology and cryptocurrency have facilitated greater transparency and control over finances, leading to the growth of the Web3 economy in Africa. The trend continues to gain traction with the emergence of decentralized finance-based financial inclusion. One of the prominent players in this space is Fonbnk, which operates as a Web3 on-ramp, allowing Africans to obtain cryptocurrency assets by exchanging their airtime credits.

Fonbnk has recently partnered with Tanda, a merchant network platform in East Africa, to launch an airtime trading marketplace across Tanda’s network of agents. The partnership is expected to increase liquidity in the marketplace through the buying and selling of prepaid airtime for profit. The collaboration between Tanda agents and vendors in East Africa is expected to create more earning opportunities for micro-entrepreneurs while allowing them to store their profits in dollarized stablecoins.

The partnership between Fonbnk and Tanda creates a growth flywheel effect through improved liquidity and marketplace efficiency. It builds trust and generates even more liquidity, creating a cycle that enhances marketplace efficiency. Additionally, the partnership enables more African users to participate in the Web3 economy, even without bank accounts or cards, by using only their airtime credits.

Although Fonbnk operates throughout Africa, its partnership with Tanda is concentrated in East Africa. The company plans to expand earning opportunities for African micro-entrepreneurs and bring decentralized finance-based financial inclusion to the masses across Africa. The partnership is expected to provide more earning opportunities for micro-entrepreneurs, thereby creating a growth flywheel effect through improved liquidity and marketplace efficiency.

The Web3 technology can facilitate an intra-African exchange economy, and it can be used for purchases and transportation between African nations thanks to its ability to be used across borders. Web3 technology can help Africans generate more economic value in the wider market, thereby contributing to Africa’s economic growth.

According to BitcoinAfrica.io, the top five African countries that have embraced Web3 and cryptocurrency are South Africa, Nigeria, Zimbabwe, Kenya, and Ghana. These countries have witnessed increased demand for digital currency, and they have the most active local cryptocurrency communities.

The partnership between Fonbnk and Tanda is expected to create significant opportunities for micro-entrepreneurs in East Africa. It will increase liquidity in the marketplace, allowing for the buying and selling of prepaid airtime for profit. Additionally, it will provide more earning opportunities for micro-entrepreneurs while enabling them to store their profits in dollarized stablecoins. The partnership is also expected to create a growth flywheel effect through improved liquidity and marketplace efficiency, building trust and generating even more liquidity. Fonbnk plans to expand its reach to other parts of Africa, thereby increasing earning opportunities for micro-entrepreneurs and promoting decentralized finance-based financial inclusion across the continent.

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BlackRock CEO Highlights Digital Assets and Tokenization

by Blockchain News

The Chief Executive Officer of the American investment firm BlackRock, Larry Fink, sent an annual letter to the board of directors in which he emphasized the possibilities of digital assets and tokenization for the asset management business. Fink made notice of the continued interest in these kinds of assets, notwithstanding the disaster that occurred with FTX, and he brought attention to the “interesting changes” that have been taking place in this sector.

Particularly, Fink mentioned the “dramatic gains” that have been made in digital payment systems, which are contributing to the progression of financial inclusion in developing countries such as India, Brazil, and Africa. This is crucial since the residents of these communities may not have access to standard financial institutions due to a lack of availability.

Tokenization, which refers to the act of putting assets or securities on a blockchain as digital tokens, may also give advantages, like enhanced liquidity and transparency. It’s possible that BlackRock, which is the biggest asset manager in the world, will be in a good position to capitalize on these trends in the years to come.

It is important to remember that BlackRock has in the past indicated that it is interested in the bitcoin and blockchain industries. In 2018, the corporation established a working group to investigate possible applications for blockchain technology. Two years later, in 2020, the company raised its interests in two Bitcoin mining companies that are publicly listed.

In general, Fink’s letter sheds insight on the increasing interest that the asset management sector is showing in digital assets and tokenization, as well as the potential that these two trends have. It will be fascinating to see how BlackRock and other big financial organizations adapt to new technological developments and integrate these trends into their business plans as technology continues to evolve.

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Fasset to Drive Financial Inclusion in Indonesia with Mastercard

by Blockchain News

Digital assets-based fintech startup Fasset Technologies has partnered with payments giant Mastercard to drive financial inclusion in Indonesia.

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This move comes off as one of Fasset’s international expansion moves since it raised $22 million in a Series A back in April.

As detailed, Fasset will bring its custom technologies to digitize banking services for Indonesians, drawing on the local integration of Mastercard to create economic opportunities for all.

“The world is changing at an unprecedented rate. With more people relying on digital assets and technologies to become resilient, there is a need for key players in the public and private sectors to come together to create solutions that can lead to new opportunities and solutions for wider financial inclusion,”, said Navin Jain, Country Manager, Indonesia, Mastercard.

The payment operator said will provide solutions in digital payments and cyber-security for Fasset to support Indonesia’s efforts in financial inclusion and advance broader access to digital technologies

Indonesia is increasingly becoming a hotbed for blockchain-related advancement. While the nation as a whole integrated blockchain into its digital economy back in September 2019, private crypto engagement has been growing rapidly over the past few years.

With more than 92 million unbanked citizens in Indonesia as of 2021 according to the Jakarta Post, Fasset alongside Mastercard expect to provide more accessible financial and digital tools that will help close the digital divide and improve the livelihood of communities. 

The partnership between Mastercard and Fasset is designed to complement related vacancies from other outfits, and the duo will promote digital education and other initiatives to drive financial inclusion across the board. 

The push by Fasset and Mastercard is expected to empower the masses but also contribute to the government’s digital economic liberation. Besides the duo, Pintu, a crypto exchange that pulled $35 million in funding last year is also among the startups looking to drive change in Indonesia.

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Digital Currency and the Financial Inclusion Drive: The Journey So Far

by Blockchain News

It is largely believed that one of the primary reasons Satoshi Nakamoto invented Bitcoin (BTC) was to solve the financial inequality amongst people.

The design of the digital currency and the blockchain backing the new form of money has largely driven new innovations into the space. 

From the surface, it appears that big corporations are cashing out more from the digital currency ecosystem based on the enormity of their investments. However, in reality, retail investors are the biggest beneficiaries of the crypto revolution. This is because the rules that have been established by the mainstream or traditional financial system that naturally gives advantage to institutional advantage do not apply in the decentralized world of digital currencies.

The Equalizing Game

Cryptocurrencies are an innovation that seeks to offer the same products and services as the financial institutions offer, but in a more flexible and decentralized manner. One of the ways this innovation is being brought to life is via Decentralized Finance (DeFi), a financial system coordinated by a predefined set of codes called Smart Contracts.

There are various expressions of DeFi and through developers’ creativity, lending, swapping, and derivatives, products now exist in the digital currency world. Unlike traditional brokers, where requirements are necessary to be met before being granted access to these products, accessing DeFi lending is free from bureaucracy, paperwork, or vetting processes inherent amongst banks.

Other products in the DeFi space are like that, and funds are free from monitoring as individuals keep custody of their digital currencies by themselves through unhosted wallets. 

Thus far, many different people have access to crypto-related products, regardless of their nationalities, races, education, age, and economic status. No financial innovation has given the insight to integrate as many people as cryptocurrencies have done from history. From the millions of crypto users around today, one can conclude that the journey towards mainstream financial inclusion has been quite promising across the board.

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Bill Gates Switches from “Bitcoin Bear” to Neutral, BTC/USD Remains Firm above $51.5k

by Btcmanager

The philanthropist billionaire Bill Gates has swung from being a Bitcoin bear to staying neutral just when the BTC price is defying gravity, recently racing above $52.5k.

Bill Gates now Neutral on Bitcoin, BTC/USD Firming above $50k

Appearing on CNBC’s Squawk Box on Feb 18, the billionaire made it clear that he never owns Bitcoin. However, he’s not “short” the world’s most valuable digital currency, choosing instead to remain neutral.

Still, the idea of moving funds digitally to cut transaction costs bodes well with the Bill and Melinda Gates Foundation. They use a digital platform in developing countries for value transfer and not tax avoidance or to perpetrate illegalities.

According to trackers, the Bitcoin price was trading above $51.8k at the time of his comments. Prices have slightly retracted from all-time highs of over $52.5k posted on Feb 17.


The Convenience of Digital Platforms

The Bitcoin network exists digitally, maintained by a web of globally-distributed node operators. Their involvement gives the platform an edge over competitors, enabling the cheap transfer of funds without intermediaries.

Also, the decentralization and the fixed supply of Bitcoin give the platform and the coin unique properties over centralized versions that are relatively expensive. This may be an inconvenience for disadvantaged people in developing countries who may need funds there and then.

Bitcoin and ICOs are Speculative

Bill’s changing tune comes three years after saying he’ll short Bitcoin if given a chance.

Coincidentally, his comments came before the Bitcoin price plunged to record lows of around $3.2k posted on the year-long crypto winter of 2018.

Appearing on the show, the billionaire said investing in the digital asset that doesn’t produce anything is a “kind of a pure “greater fool theory.” ”

He went on to add that ICOs were “crazier speculative things.”

“As an asset class, you’re not producing anything, and so you shouldn’t expect it to go up. It’s kind of a pure ‘greater fool theory’ type of investment. I agree I would short it if there was an easy way to do it. Bitcoin and ICOs, I believe completely [they’re some] of the crazier, speculative things.”

As BTCManager reports, the participation of institutions and odds of the U.S. Securities and Exchange Commission (SEC) approving a Bitcoin ETF could see the coin rally to $100k by the end of 2021.


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World Economic Forum Views Cryptocurrency as Pivotal Tool for Financial Inclusion

by Blockchain News

The World Economic Forum (WEF) trusts that cryptocurrencies can be pivotal in offering financial services to one-third of the world’s adults, approximately 2 billion people, who are unbanked as acknowledged by the World Bank. The unbanked usually lack wealth-building tools and services, and this jeopardizes their plan for the future.

World Economic Forum Views Cryptocurrencies as Pivotal Tool for Financial Inclusion

Cryptocurrencies are revamping the financial world

The unbanked problem is not only prevalent in developing countries but also in developed ones. The WEF noted:

“The Federal Reserve found that 22% of adults in the United States are either unbanked or underbanked. That’s roughly 63 million Americans who either have no bank account at all or rely on “alternative financial service products” such as money orders, check cashing services, or payday loans to fulfil their financial needs.”

The engine behind cryptocurrencies is blockchain technology, which enables participants to confirm transactions in the absence of a central authority. The WEF believes that this attribute will be instrumental in democratizing the traditional financial system and prompt more inclusion. 

For instance, nearly one-third of Nigerians own some form of cryptocurrency, which enables them to buy or sell goods and remit funds across borders to family and friends. 

Cryptocurrencies aid in safeguarding people’s assets

Stablecoins, which are cryptocurrencies pegged to traditional assets like the US dollar, are instrumental in safeguarding people’s assets. The WEF added that cryptocurrencies render wealth-building tools and services like tokenization of stocks, such as Tesla, Amazon, and Apple. 

Per the announcement:

“Because they’re tokenized, users can start investing in tokenized stocks with as little as $5. This is possible because they can buy fractional portions of a token, which inherently represents fractional portions of a share of stock.”

Cryptocurrencies like Bitcoin and Ethereum coupled with mobile services, such as Kenya’s M-Pesa mobile payment system facilitate savings and payments. Recently, 10T holdings co-founder Dan Tapiero acknowledged that Bitcoin was uplifting Generation Z’s saving culture. 

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Bitcoin (BTC) $ 26,538.11 0.36%
Ethereum (ETH) $ 1,592.24 0.19%
Litecoin (LTC) $ 64.82 0.51%
Bitcoin Cash (BCH) $ 207.48 1.17%