US National Security at Risk Due to China’s Dominance in Mobile Payments, says former State Department Official

Former Department of State official Anja Manuel warns that if the US loses its dominance in financial innovation and payments, it could impact its national security policy, specifically on sanctions. Manuel stated that China is catching up on dominance in mobile payments, which could make enforcing sanctions against “bad actors” like Iran or North Korea more challenging. (Read More)


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US National Security at Risk Due to China Dominance in Mobile Payments, says former State Department Official

In a Twitter Spaces discussion with Coinbase CEO Brian Armstrong and listeners, former Department of State official Anja Manuel cautioned that the US’s ability to enforce sanctions on “bad actors” like Iran or North Korea could be threatened if it fails to maintain its leadership in financial innovation and payments. According to Manuel, the US’s status as one of the largest global leaders in payments enables it to enforce sanctions on countries and entities that are deemed to be a threat to national security. However, China seems to be catching up in mobile payments, both in sophistication and scale. If China’s payments solutions gain a dominant foothold in the developing world, enforcing sanctions could become significantly more challenging.

The Office of Foreign Assets Control of the Treasury Department enforces US sanctions, including sanctions on crypto wallets related to Russian nationals and groups’ involvement in the war on Ukraine. Manuel acknowledged that sanctions generally work in a world of traditional banks and responsible blockchain firms, but they are less effective when financial technology firms are available to individuals looking to circumvent restrictions.

There are several reasons why maintaining US dominance in financial innovation and payments is essential for national security. First, the ability to enforce sanctions against countries deemed to be a threat to national security is critical. Sanctions are a key tool in deterring countries from pursuing policies that threaten US interests. Second, financial innovation and payments are critical for US economic growth. The US’s ability to innovate and create new technologies has been a key driver of economic growth for decades.

The US government has historically played a significant role in fostering innovation and supporting the growth of new technologies. However, there are concerns that the US is losing ground to other countries, particularly China. China has made significant investments in technology and innovation and has developed a reputation as a global leader in several areas, including mobile payments.

To maintain its leadership in financial innovation and payments, the US must continue to support the growth of new technologies and create an environment that fosters innovation. This will require a significant investment in research and development, as well as regulatory frameworks that support the growth of new technologies while also protecting consumers and national security.

In conclusion, the US’s ability to maintain its leadership in financial innovation and payments is critical to its national security. If the US loses ground to other countries, particularly China, enforcing sanctions and deterring countries from pursuing policies that threaten US interests could become much more challenging. The US must continue to invest in research and development and create regulatory frameworks that support innovation while also protecting national security.


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Block’s Cash App Bitcoin Revenue Falls 7%

The Cash App business section of Jack Dorsey’s payment startup, Block Inc., reported Bitcoin (BTC) revenue of $1.83 billion in the fourth quarter, which is a 7% decrease from the same period last year.

Block attributed the reduction in Bitcoin income to the decline in the price of BTC during the year, which was reported in its quarterly and full-year results on February 23. Bitcoin’s price dropped by nearly 65 percent throughout the course of 2022.

Due to the decrease in sales, Cash App’s Bitcoin gross profit decreased by 25% year-on-year, coming in at $35 million for the quarter. This was the lowest quarterly total since the company began reporting Bitcoin earnings.

Block’s Cash App is an application for processing payments made using mobile phones. On October 25th, functionality for transactions made via the Bitcoin Lightning Network was enabled to Cash App. It does this by offering Bitcoin sales to its consumers via the app, which brings in money.

In the entire year of 2022, Cash App made $7.11 billion in Bitcoin revenue and $156 million in Bitcoin gross profit, representing decreases of 29% and 28%, respectively, when compared to 2021’s figures.

In the meanwhile, Block Inc. reported a significantly increased net loss for the quarter, coming in at $114 million. This is compared to a loss of $77 million in 2021. When compared to the same period of the previous year, its adjusted profits before interest, tax, depreciation, and amortization (EBITDA) rose to $281 million, or a 53% rise. The aggregate amount of revenue during the period was $4.65 billion.

Following the release of the results report, the after-hours trading of Block’s shares resulted in a significant price increase.

The increase in the company’s gross profit, which was up 40% in Q4 compared to the same period the previous year and also above expert estimates, has been ascribed by some analysts to the surge in revenue.


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The Importance of Embedded Finance in Today’s Fintech World

A recent research conducted by Decta brought to light the significance of integrated financial elements in the modern world of fintech. According to the findings of the survey, some significant drivers for a seamless customer experience are the increasing use of online purchasing and digital payment methods.

Embedded finance is a novel method of software distribution that collaborates with suppliers of financial infrastructure to include financial services into the ecosystems of goods that are already on the market. Banking, lending, insurance, payments, and branded credit cards are some of the most frequent types of integrated financial solutions.

According to the findings of the survey, the most important factors that contribute to a positive experience when making purchases online are the ease with which payments can be made and the number of different payment methods that are available. The primary cause of an unpleasant shopping experience is the absence of a chosen payment option or difficulty during the checkout process. Almost 49 percent of respondents said that they would probably quit shopping if they ran across these difficulties.

One of the most important aspects of embedded finance is the ability to provide personalized offers, which are highly appreciated and may be improved by concentrating on certain demographics. For instance, 54 percent of American consumers favored integrated add-ons such as finance and insurance. Members from Generation X were the most happy with personal offers, whilst participants from Generation Z and Baby Boomer rated the offers they received a lower grade.

Other favored integrated features that gained the approval of the respondents include loyalty benefits, seamless payments, and same-page checkouts.

The research gives insights into client targeting and acquisition as cryptocurrency firms are steadily seeking to incorporate embedded financial elements, such as crypto-based credit cards or loans. The use of blockchain technology has been investigated by crypto companies as a means of assisting traditional businesses in the implementation of loyalty incentives and integrated financial services.

During the most recent bull market, the bitcoin ecosystem was able to benefit from increased investment from institutional investors. As a result of conventional hedge funds and some of the largest firms in the Fortune 500 jumping on the cryptocurrency bandwagon, we are starting to see widespread acceptance of cryptocurrencies.

However, there is still a significant distance to go with the primary goal of making cryptocurrency usable on a daily basis by retail customers. The research conducted on embedded finance may be able to assist crypto firms in taking a hint from the mainstream and putting it into practice with crypto-linked goods in order to provide a superior experience for their customers.


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Bahamas’ Sand Dollar CBDC Begins Facial-Recognition Rollout to Authorize Mobile Payments

Sand Dollar CBDC has continued to advance its usage and started addressing the issue of user authentication.

SunCash, a financial institution authorized to provide Sand Dollars in the Bahamas, announced on Thursday that it has partnered with PopID Inc software company to allow holders of the Bahamian Sand Dollar to use PopID’s PopPay platform to authenticate themselves.

It is the first time in history that consumers can now use the PopPay face verification platform to buy goods and services with a CBDC (central bank digital currency).

Bahamian citizens can now link their SunCash wallets to PopPay to enable face pay transactions using their Sand Dollars, a central bank digital currency in the Bahamas.

This will allow consumers to spend Sand Dollars at merchants (businesses) accepting SunCash payments using their faces for authentication.

Likewise, various local and global brands accepting digital Sand Dollars through the SunCash platform will be authenticated by PopPay.

PopPay’s technology allows merchants to verify customers’ identities with a facial scan. The technology links any payment method, including digital currencies, direct bank transfers, and debit/card cards, to the user’s unique facial characteristics.

Reports show that SunCash has over 55,000 active wallet holders, one-seventh of the population of the Bahamas, and more than 1,000 merchants accept the wallet.

Desmond Pyfrom, CEO of SunCash, talked about the development and said: “PopPay’s cutting edge technology provides a more consumer-friendly, seamless, and secure experience for SunCash’s users. With the integration of the PopPay platform into the SunCash App, Bahamian consumers can now quickly, efficiently, and safely use the digital Sand Dollar to purchase food and other products even if the consumer does not have a functional smartphone or an internet connection.”

Digitizing Retail Payments

Private digital currencies are storming financial markets, and as a result have prompted central banks globally to create their own, legally-backed digital tokens.

The Central Bank of The Bahamas issued the Sand Dollar– a digital iteration of the Bahamian Dollar, in October 2020.

With Sand Dollar, local consumers can receive and make payments electronically from a digital wallet using either their smartphones or a physical payment card they can manage via merchants across the nation.

Residents can open digital currency accounts, store the CBDC in an e-wallet approved by the central bank and use it for payments. The records collected during daily operations, like income and spending information, can support applications for micro-loans.

An IMF FinTech report showed that in late 2021, the number of active Sand Dollar wallets was about 20,000 in a population of about 400,000. 

Image source: Shutterstock


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Alchemy Pay gains 77% after exchange listings and cross-chain integrations

The cryptocurrency ecosystem has come a long way since the launch of Bitcoin (BTC) and in the last few years smart contracts have revolutionized the industry. With that said, there is still plenty of progress to be made when it comes to integrating blockchain technology to peer-to-peer, business to business and business to consumer payment systems.

Alchemy Pay aims to further the adoption of cryptocurrencies through its hybrid payments system and in the last week its ACH token gained 77% to trade at $0.0625 on Feb. 9. 

ACH/USDT 4-hour chart. Source: TradingView

Three reasons for the uptick in ACH price include the cross-chain launch of ACH on the Binance Smart Chain (BSC), multiple new exchange listings that have helped expand access to the token and the integration of Alchemy Pay with multiple blockchain projects across the ecosystem.

ACH joins Binance Smart Chain

The most significant development for the Alchemy Pay protocol was its launch on the Binance Smart Chain at the end of January.

Aside from allowing for cheaper transactions for ACH users, the cross-chain integration also helped increase the pool of available investors in ACH through the listing of tokens on BSC-based decentralized exchanges like PancakeSwap.

Alchemy Pay also partnered with Bit.Store to conduct an airdrop of the project’s STORE token as a way to reward community members and encourage future collaborations.

Fresh exchange listings tend to boost altcoin prices

A second factor helping boost the momentum in the price of ACH has been its listing on multiple exchanges, including Binance on Jan. 10.

Other notable exchange listings over the past month include WazirX, CoinEx Global, MEXC Global, ONUS Finance, Tokocrypto and XT Exchange.

Several exchanges, including Binance, have also introduced high-yielding staking products to help attract liquidity and Gate recently added a 3X leveraged ACH instrument.

Related: Cointelegraph Research: Valuing a crypto payment token

Integrations across the crypto ecosystem

A third development that has solidified support for ACH has been the integration of Alchemy Pay with multiple blockchain networks and this should speed up the launch of fiat payments.

Networks and protocols that have integrated Alchemy Pay since mid-December include IoTeX, Avalanche, Polygon, Algorand, NIUM, MakerDAO and SimpleHold.

VORTECS™ data from Cointelegraph Markets Pro began to detect a bullish outlook for ACH on Feb. 8, prior to the recent price rise.

The VORTECS™ Score, exclusive to Cointelegraph, is an algorithmic comparison of historical and current market conditions derived from a combination of data points including market sentiment, trading volume, recent price movements and Twitter activity.

VORTECS™ Score (green) vs. ACH price. Source: Cointelegraph Markets Pro

As seen in the chart above, the VORTECS™ Score for ACH spiked into the green and reached a high of 74 on Feb. 8, around four hours before the price increased 55.5% over the next day.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Every investment and trading move involves risk, you should conduct your own research when making a decision.