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Weekly Research Highlights - 28 September 2021
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Weekly News Highlights – 22 September 2022

Stay up to date with the latest news from fintech! This week, we bring you updates on regulations, legislations, partnerships, and more. Enjoy reading!

Fed raises rates by another three-quarters of a percentage point, pledges more hikes to fight inflation (CNBC)
The Federal Reserve on Wednesday raised benchmark interest rates by another three-quarters of a percentage point and indicated it will keep hiking well above the current level. In its quest to bring down inflation running near its highest levels since the early 1980s, the central bank took its federal funds rate up to a range of 3%-3.25%, the highest it has been since early 2008, following the third consecutive 0.75 percentage point move. Stocks seesawed following the announcement, with the Dow Jones Industrial Average most recently down slightly. The market swung as Fed Chairman Jerome Powell discussed the outlook for interest rates and the economy. Traders have been concerned that the Fed is remaining more hawkish for longer than some had anticipated. Projections from the meeting indicated that the Fed expects to raise rates by at least 1.25 percentage points in its two remaining meetings this year. Read more

US congressional stablecoin bill would ban terra-like coins (The Financial Review)
Legislation to regulate stablecoins that’s being drafted in the US House of Representatives would place a two-year ban on coins similar to terraUSD, the algorithmic stablecoin that collapsed earlier this year. Under the latest version of the bill, it would be illegal to issue or create new “endogenously collateralised stablecoins,” according to a copy sighted by Bloomberg. The definition would kick in for stablecoins marketed as being able to be converted, redeemed or repurchased for a fixed amount of monetary value, and that rely solely on the value of another digital asset from the same creator to maintain their fixed price. Read more

13 major European fintechs launch the Open Finance Association (The Paypers)
A group of 13 fintechs including the likes of Token, TrueLayer, Plaid, Worldline or Yapily have launched the Open Finance Association (OFA) to further open up financial data and payments through API tech. As explained by association officials in the press release announcing the launch, with the introduction of PSD2 in 2016 consumers and businesses were given the right, for the first time, to access their payment accounts via trusted third-party providers (Open Banking). Open Finance is presented as the next step in the evolution of Open Banking and it promises to give consumers and businesses greater control and visibility of their economic lives. Read more

New EU cybersecurity rules ensure more secure hardware and software products (European Commission)
The Commission presented yesterday a proposal for a new Cyber Resilience Act to protect consumers and businesses from products with inadequate security features. A first ever EU-wide legislation of its kind, it introduces mandatory cybersecurity requirements for products with digital elements, throughout their whole lifecycle. The Act, announced by President Ursula von der Leyen in September 2021 during her State of the European Union address, and building on the 2020 EU Cybersecurity Strategy and the 2020 EU Security Union Strategy, will ensure that digital products, such as wireless and wired products and software, are more secure for consumers across the EU: in addition to increasing the responsibility of manufacturers by obliging them to provide security support and software updates to address identified vulnerabilities, it will enable consumers to have sufficient information about the cybersecurity of the products they buy and use. Read more

US venture capital firm ffVC launches Ukraine-focused fund (Fintech Magazine)
Venture capital firm ffVC has launched a Ukraine-focused fund to support the country through its economic recovery, insisting it is not out of charity. US venture capital firm ffVC has announced the launch of a new specialised fund that will invest exclusively in Ukrainian founders and startups. Called the ff Blue & Yellow Heritage Fund, after the colours of Ukraine’s flag, the fund represents the next step in ffVC’s existing investments in Central and Eastern Europe (CEE). In 2019, it opened an office in Warsaw and led the seed round for Kyiv-based Respeecher, which creates voice-cloning software that has been used in Disney television series. A year later, it created a tech and gaming-focused fund for the CCE region. Read more

White House sets out digital asset framework (Finextra)
The White House has put together a framework for the “responsible development” of digital assets that includes a more aggressive push by regulators to take on fraud in the sector. The framework comes six months after President Biden issued a sweeping executive order on the oversight of cryptocurrencies and is based on reports with recommendations on protecting consumers, investors, businesses financial stability, national security and the environment. The reports call for the SEC and CFTC to “aggressively pursue investigations and enforcement actions against unlawful practices in the digital assets space”, and also asks the CFPB and FTC to “redouble their efforts to monitor consumer complaints”. Read more

EU Finalizes Legal Text for Landmark Crypto Regulations Under MiCA (Coindesk)
The European Union has finalized the full text of its landmark Markets in Crypto Assets (MiCA) legislation. Officially, the text is still open to comments, but sources briefed on the talks have told CoinDesk that it is, in practice, finalized. A leaked draft of the bill dated Sept. 20 and verified by CoinDesk urges EU enforcers to take a “substance over form” approach to the law, meaning its provisions could even apply to some assets categorized as non-fungible tokens (NFT). MiCA, once passed into law, will require issuers of crypto assets to publish white papers containing technical roadmaps, for platforms to register with the authorities, require stablecoin issuers to hold capital and be prudently managed. Read more

European Central Bank picks five partners for digital euro initiative (Fintech Futures)
The European Central Bank (ECB) has selected five companies – out of 54 applicants – to collaborate with for the development of potential user interfaces for the digital euro. The selection is a result of the call of expressions of interest for the prototyping exercise issued by the ECB in April this year. Whilst all of the hopefuls fulfil a number of “essential capabilities” that were outlined in the call, the bank explains, the five providers chosen best matched the “specific capabilities” required for the assigned use case. Read more

PCI Pal launches Pay By Bank Open Banking solution for contact centres (The Paypers)
UK-based PCI Pal has launched a new Open Banking solution for contact centres named Pay By Bank, which will allow merchants to minimise the cost of transactions. PCI Pal is a SaaS provider of secure payment solutions for business communications, and its Pay By Bank Open Banking system is the first in a series of new agent-assisted, digital payment products. These products were designed to help merchants minimise the cost of transactions and provide instant refunds while reducing chargeback costs and fraud risks. Read more

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