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Ripple (XRP) Could Surge or Tank in the Next Three Days

Ripple XRP

Ripple’s XRP prices are on the rise
spurred on by its recent partnership with Money Gram. The cross border money
mover has elected to use Ripple’s xRapid and XRP to settle its foreign exchange
transactions. Consequently, Ripple Inc, which owns 60 percent of all XRP now,
also owns MoneyGram shares worth $30 million. There is also the option of purchasing
$20 million more worth of MoneyGram equity in the near future.

Speaking on the development Money
Gram’s chief executive and chairman, Alex Holmes said:

 “Through Ripple’s xRapid product, we will have the ability to instantly settle funds from US dollars to destination currencies on a 24/7 basis, which has the potential to revolutionize our operations and dramatically streamline our global liquidity management.”

The MoneyGram International Inc shares have also soared past the 155 percent  after its tie-up with Ripple. The giant cross border money transactions giant has over $1.4 billion in annual revenue. Pundits say that the match between Ripple and MoneyGram highlights increased investments into and from blockchain. It also shows that the crypto industry is getting off the sidelines and going mainstream.

XRP Prices in The Balance

Is the XRP price rise going to hold or
slide back to normalcy once the excitement recedes? A lot more is going on
globally this week that could keep the surge on, or halt investor interest. The
G20 leaders summit happening in Osaka Japan on June 28-29 is one of those
events whose outcome could spur or cause a crypto dump.

US President Donald Trump and Chinese President Xi Jinping have gone head to head in a trade war that’s have been turning investor attention to crypto. The leaders of the world’s biggest economies have gone for tit for tat tariffs skirmishes. This has, however, escalated to defense and geo-strategic concerns. The indication that the US Federal Reserve was getting reactionary on interest rates in return has been a big shot in the arm for cryptocurrencies.  

The shift in policy by the Federal
Reserve has positively influenced the fortunes of other financial assets,
especially crypto and gold.   On June 19,
for instance, Jerome Powell, the chairperson of the US Federal Reserve,
indicated that they were going to maintain the interest rates at the 2.25-2.5
percent target range. With that, Bitcoin’s prices surged past the $11,000 mark,
gaining impressive gains of $1,000 in a day.

As it is, the Federal Reserve is
maintaining the current borrowing costs, defying the pressure from a government
concerned about a cooling economy. If the Trump, Xi Jinping meeting in Osaka,
nevertheless, brings about an economic cease-fire, the Fed might not need to
take drastic measures. This might lower the current surge in interest in crypto
and gold considered as safe havens in an uncertain Wall Street future.

The BIS Rising Interest in Digital Assets Regulation

The V20 summit will commence alongside the G20 summit. This platform is devoted to virtual asset service providers’ (VASPs) and is set to discuss the Financial Action Task Force (FATF) recommendations. There also will be a discussion on the FATF’s forthcoming proposal and its impact.

The Bank of International Settlements is also publishing its Annual Economic Report and Annual Report on June 30. The BIS is not particularly bullish on crypto and has issued a warning beforehand on financial services offered by tech firms. It has said that they could bring in new risks for the banking sector.

What the upcoming publication holds may influence the XRP price since its C-level team has been making headways with the world’s central banks. More good news for Ripple is that SBI Ripple Asia is planning a full launch Money Tap app in-store payments.  The app is dependent on xCurrent, and the SBI Holdings CEO Yoshitaka Kitao joined Ripple’s board. SBI is also launching real-time XRP trading in its virtual currencies exchange.

The post Ripple (XRP) Could Surge or Tank in the Next Three Days appeared first on Ethereum World News.

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BIS: Facebook’s Foray into Cryptocurrency Poses New Risks for Banks

The Bank of International Settlements warns that financial services offered by big tech firms such as Facebook, Google and Amazon could create new risks for the banking sector.

The Bank of International Settlements (BIS) has warned that the financial services poised to be offered by big tech firms such as Facebook, Google and Amazon could generate new risks for the banking sector.

The BIS — an international financial institution in Switzerland owned by 60 of the world’s central banks — published a report outlining its stance on June 23.

Hot on the heels of Facebook’s newly-announced cryptocurrency, Libra, the BIS said that while big tech firms’ foray into finance can bring efficiency gains and broaden financial inclusion, regulators must step up their action to mitigate the new and complex risks involved.

According to BIS, big tech firms’ extensive user base, access to user data and multi-faceted business models have the potential to rapidly change the financial services industry. Their low-cost structure business is highly scalable, and the network structure of widely-visited platforms can help promote financial inclusion in populations that remain underbanked, it notes.

Yet, the BIS warns, “the very features that bring benefits also have the potential to generate new risks and costs associated with market power.”

The BIS claims that big tech firms introduce both known — as well as new and unfamiliar — risks to the financial services landscape.

Among the established issues, it notes the risks to financial stability and consumer protection posed by tech giants that “have the potential to loom large very quickly as systemically relevant financial institutions” — thereby disrupting the traditional banking sector and existing structure of financial intermediation.

The report notes that such firms efficiently leverage a “data-network-activities loop” that could well accelerate the success of their entry into finance, yet this very business model raises new and unprecedented challenges for regulators — notably competition and data privacy issues.

Given that firms such as Facebook straddle traditional regulatory perimeters and national borders, the BIS calls for national and international coordination among authorities to “ensure a level playing field between big techs and banks.”

As previously reported,  Facebook published the white paper for its long-awaited cryptocurrency and blockchain-based financial infrastructure project, Libra, on June 18.

International reactions to Libra have thus far been mixed, including ambivalent remarks from the Chair of the United States Federal Reserve, and a statement from the chairman of the Russian State Duma Committee on Financial Markets that the token will not be legalized in Russia.

The Governor of the Reserve Bank of Australia (RBA) has meanwhile downplayed the likelihood that Libra could attain wide-ranging usage before relevant regulatory issues are addressed.

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Bank of Banks Head, Agustín Carstens’ Speech on Crypto is Changing

Agustín Carstens BIS

After Bitcoin celebrated its 10th birthday, its strong momentum has made some crypto critics to change their hard opinion on cryptocurrency. The leader of this new wave is Agustin Carstens, General Manager at the Bank for International Settlement (BIS). BIS is considered as the bank of Banks since it majorly deals with central banks and international financial institutions.

Speaking at the conference on technology-enabled disruption, Carstens said:

“They [digital assets (DAs)] might have room as part of financial assets, but not as a cash substitute.”

It’s
a Shock

This is the first time the BIS general manager is casting Bitcoin and other digital assets in a positive light. The change of heart was received by the crypto community in disbelief that such a huge basher of crypto would one day see the crypto light.

For instance, XrpCenter tweeted:

“Speech on crypto is changing. This is the 1st positive comment on crypto from Agustin. He has authored many anti-crypto articles before.”

Some of the anti-crypto sentiments released by
the BIS chief ranged from warning crypto developers from launching a new form
of money to seeing no value in digital currencies issued by central banks.

In Mid-2018, Carstens cautioned cryptocurrency coders to “stop trying to create money” since cryptos will not last for long and they have a possibility of ending in a bang. In a statement published on the BIS website on July 4, 2018, the BIS chief said:

“Even the great physicist Isaac Newton was at one point in his life obsessed with alchemy and the idea of making gold… After he failed in his attempt to make gold, he switched sides and sent counterfeiters to prison. So my message to young people would be: Stop trying to create money!”

A
Central Bank-Backed Virtual Currency A Threat To Financial Stability

Towards the end of March this year, while
addressing the Central Bank of Ireland, the BIS general manager said:

“There are huge operational consequences for central banks in implementing monetary policy and implications for the stability of the financial system. Central banks do not put a brake on innovations just for the sake of it. But neither should they speed ahead disregarding all traffic condition.”

In his speech, Carstens portrayed a situation where central bank-backed digital assets would alter interest rates. Additionally, a CBDC (central bank-backed digital currency) would have an impact on the public’s appetite for money.

Crypto is a Bubble and a Ponzi Scheme

In Feb 2018, while speaking at Goethe University, Carstens said that Bitcoin and all its friends are a “combination of a bubble, a Ponzi scheme and an environmental disaster.” As such, central banks should be more vigilant when formulating a regulatory framework around virtual currencies.

It is after all these warnings and threats
that his change on how he sees cryptos came as a shock to many. Some crypto
enthusiasts even “never thought his tune is going to change” with some finding
the change “to be a pretty big deal.”

The post Bank of Banks Head, Agustín Carstens’ Speech on Crypto is Changing appeared first on Ethereum World News.

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Bank for International Settlements Exec Advises Against Central Bank Digital Currencies

Bitcoin critic and general manager at the Bank for International Settlements advised against the issuance of CBDCs.

Bitcoin (BTC) critic and general manager at the Bank for International Settlements (BIS) Agustin Carstens advised against the issuance of central bank digital currencies (CBDCs) in a speech in Dublin on March 22. Bloomberg reported on the speech the same day.

Per the report, Carstens explained that a CBDC could facilitate a bank run, enabling people to move their funds from commercial banks to central bank accounts faster, thus destabilizing the system. Another issue that Carstens said arises with CBDC use, according to Bloomberg, is the different impact of interest rates on the public’s demand for money.

Carstens reportedly said that this influence could lead to bigger central bank balance sheets that require a buildup of assets, which could potentially impact the liquidity of the financial markets. Per Bloomberg, he also noted that there are enormous operational consequences for the central bank in the implementation of monetary policy and the traditional market’s stability. Lastly, he noted:

“Central banks do not put a brake on innovations just for the sake of it. But neither should they speed ahead disregarding all traffic conditions.”

As Cointelegraph reported in February, Carstens called Bitcoin a “combination of a bubble, a Ponzi scheme and an environmental disaster” and asked central banks to more closely regulate cryptocurrencies to prevent them from becoming part of the main financial system.

A report published in January by the BIS has found that seventy percent of central banks worldwide are conducting research into CBDC issuance.

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Growth of Crypto Industry Could Threaten Banks, Financial Stability: Basel Committee

The Basel Committee on Banking Supervision believes that cryptos are unsafe to rely on as a medium of exchange or store of value.

International banking authority the Basel Committee on Banking Supervision (BCBS) has issued a warning statement on crypto assets on March 13.

The BCBS is a committee of banking supervisory authorities hosted and supported by the Switzerland-based Bank for International Settlements (BIS) —  an organization made up of 60 of the world’s central banks

In today’s statement, the committee warned that the robust growth of the crypto industry could potentially “raise financial stability concerns and increase risks faced by banks.” The committee noted the risks were present despite the crypto market’s currently small scale in relation to the scope of the global financial system.

The BCBS also argued that crypto assets are “unsafe to rely on” as a medium of exchange or store of value, two of the main functions of money, implying that “cryptocurrency” is a misnomer. The authority also stated that crypto assets do not represent legal tender and “are not backed by any government or public authority.”

Pointing to a large number of risks associated with the interaction between banks and crypto-related businesses, including the risk of money laundering, terrorist financing, fraud and hacking, the BCBS provided a list of minimum requirements for a bank to operate crypto-related services.

According to the committee, any bank that decides to work with crypto-related assets should first ensure it possesses relevant technical expertise to adequately evaluate the risks associated with the field. The bank should also guarantee a clear and effective risk management framework, providing regular relevant data related to the bank’s crypto-asset risk profile.

Additionally, a bank should also publicly disclose any crypto-related services along with its usual financial disclosures, as well as be compliant with local regulations.

In January, the BIS published research claiming that departing from Bitcoin’s (BTC) proof-of-work system will not solve the major problems faced by the biggest cryptocurrency.

Previously, the BIS reported that 70 percent of global central banks are exploring the benefits of central bank digital currency (CBDC) issuance, while clear implementation plans and motivations significantly vary depending on contexts.

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Muh Monopoly! How a Banker's Talk Sparked All Kinds of Crypto Mockery

Last week, Agustin Carstens, the head of the Bank of International Settlements (BIS), widely considered the central bank of central banks – told cryptocurrency makers to “stop trying to create money.”

And the crypto community promptly had a field day with those remarks.

The BIS head has, to date, adopted a largely hostile tone toward cryptocurrencies. Back in February, he called bitcoin “a combination of a bubble, a Ponzi scheme and an environmental disaster” during a lecture.

Carstens isn’t alone in his view, to be sure. Billionaire Warren Buffett, for example, said earlier this year that bitcoin is “rat poisoned squared,” while JPMorgan Chase CEO Jamie Dimon famously declared in 2017 that bitcoin is “a fraud” (though he later said he regretted issuing those remarks).

And while Carstens has long held this position, it was his remarks last week – essentially calling for a moratorium on te creation of new cryptos – that drew the ire of many in the community on social media. He also argued that “it’s a fallacy to think money can be created from nothing” – a contention that drew more than a few derisive comments.

It was developer Jameson Lopp who perhaps best summed up that collective sentiment:

Indeed, many drew issue with the fact that an institution tied to central banks – which manage the money systems of economies and serve as lenders of that money – would call out anyone over the creation of money from nothing.

The trust issue

It’s worth noting that, at the time of the bitcoin network’s official launch in January 2009, the world’s financial sector was, to quote Satoshi Nakamoto, “on the brink of collapse.” That line – “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks” – was immortalized in bitcoin’s genesis block.

As Coinbase chief technology officer Balaji Srinivasan quipped, bitcoin’s creation was steeped in the context of mistrust in banks.

Commentator Matt Odell argued that Carstens got at least one thing “almost right”: that trust is a valuable thing.

But in this case, however, it’s not central banks that are earning the trust of everyday folk.

Currency competition?

While Carstens never came out and declared that cryptocurrencies pose a competitive threat to central bank-backed monies, his organization has touched on the subject in the past.

Last month, the BIS published a report that examined them, concluding that “the decentralized technology of cryptocurrencies, however sophisticated, is a poor substitute for the solid institutional backing of money.”

Harsh stance aside, the BIS noted that “the underlying technology may have promise in other fields” – something other central banks have highlighted before.

Whether Carstens intended to or not, his comments came across as a bit of a competitive challenge to some in the crypto space.

Indeed, Carstens’ contention was ultimately positioned as an argument for fiat currencies in favor of cryptocurrencies.

And – perhaps unsurprising – some observers saw Carstens’ commentary as a sign that they should, in fact, buy more cryptocurrency.

Ultimately, Carstens’ call to stop creating new kinds of money may have actually inspired people to do the opposite.

Carstens image via Shutterstock

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