Stay up to date with the latest news from fintech! This week, we bring you updates on regulations, legislation, partnerships, and more. Enjoy reading!
EU Parliament approves the Transfer of Funds regulation (The Payper)
The EU Parliament has voted on a new set of rules that support the tracing of crypto asset transfers in the same way as traditional money transfers. Specifically, MEPs approved with 529 votes in favour to 29 against and 14 abstentions the first piece of EU legislation that allows the tracing of crypto-asset transfers, including bitcoin and electronic money tokens. The Transfer of Funds regulation was provisionally approved by Parliament and Council negotiators in June 2022. The primary goal of this endeavour is to ensure that crypto asset transfers can always be traced and that suspicious transactions can be blocked. The actual implementation of the law will rely on the ‘travel rule,’ which mandates that any information on the source of the asset and its beneficiary will have to ‘travel’ with the transaction and be stored on both sides of the transfer. In the case of self-hosted wallets, the new law will cover transactions above EUR 1000 when hosted wallets managed by crypto-assets service providers are involved. Read more
European Payments Initiative to acquire iDeal and Payconiq (Finextra)
The European Payments Initiative, a bank-backed venture that was initally set up to build a rival to Mastercard and Visa in Europe, is to acquire Dutch payment scheme iDeal and Payconiq, the mobile payments app supported by a host of Belgian and Dutch banks. Initially backed by 31 major Eurozone banks and acquirers Worldline and Nets, the EPI set itself the goal of building a unified pan-European payment system, offering a card for consumers and merchants across Europe, a digital wallet and P2P payments. Backed by the European Central Bank, the scheme was set to enter its operational phase last year, but financing had become a concern for members, prompting a move to seek outside funding. Tha failure to agree terms led to the pull out of 20 banks, including all Spanish members as well as Germany’s Commerzbank and DZ Bank. Plans to launch a payment card were also ditched as the company reined in its ambitions. Read more
Ukraine embraces the EU’s new cryptocurrency regulations(The Payper)
Ukrainian regulators have stated publicly that they plan to adopt the European Union’s Markets in Crypto-Assets (MiCA) regulation. According to cointelegraph.com, the Deputy Chairman of the Tax Committee of Ukraine, Yaroslav Zheleznyak, revealed via Telegram that Ukraine-based regulators are working on implementing some provisions of MiCA to make crypto assets legal in Ukraine. He also revealed that regulators are working with colleagues from the National Commission for Securities and the Stock Market (NKCPFR), whose representatives expressed their belief that Ukraine will be one of the first countries to integrate the new EU regulations into national legislation. Ukraine’s willingness to adopt EU regulations comes in the context of it receiving candidate status to the EU in June 2022. According to officials from the European Council cited by cointelegraph.com, European regulators have acknowledged the efforts that Ukraine has performed towards meeting the objectives underpinning its candidate status for EU membership. MiCA represents the effort of European policymakers to introduce standardised regulations and create unique rules for crypto assets across the European Union. At the time of writing, crypto businesses need to adhere to 27 distinct regulatory frameworks across EU member countries. Read more
JPMorgan uses ChatGPT to analyse Fed speeches – Bloomberg (Finextra)
JPMorgan has built a ChatGPT-based language model to analyse Federal Reserve statements and speeches in an effort to sniff out potential trading signals. The model scoured 25 years’ worth of Fed speeches to rank them on a “Hawk-Dove” score, says Bloomberg. JPMorgan economists then plotted the index against asset performances and found that the AI could potentially help in predicting policy changes and be useful for trading. In a note, the bank says “preliminary applications are encouraging,” and the model has already been expanded to cover the European Central Bank and the Bank of England, with more central banks to follow. Read more
Revolut and Atom Bank investor slashes fintech valuations (altfi)
Schroders has marked Revolut down 46 per cent and Atom Bank 31 per cent. How do you value a private fintech startup. It’s a tricky philosophical question in 2023 as well as a financially technical one. Funding rounds normally provide the most common data point, with a multi-investor agreed price tag for a unit of ownership. But some investors are required to ‘mark down’ their portfolio investments on a regular basis. This has dealt a $15bn knock to Revolut’s lofty $33bn implied by its last round of funding in 2021. Schroders Capital Global Innovation trust, a UK-listed investment trust with a £10m stake in Revolut has marked its holding down by 46 per cent to £5.4m. Atom Bank, which is the fund’s second largest holding after Oxford Nanopore, has been marked down 31 per cent. The Durham based lender last raised funds in 2022 at a £460m valuation. Read more
Europe names 19 platforms that must report algorithmic risks under DSA (Tech Crunch)
The European Union has confirmed the names of over a dozen platforms that will face the strictest level of regulation under its recently rebooted and expanded ecommerce rules, aka the Digital Services Act (DSA). The list is a mix of familiar digital services, from social media apps to search engines and app stores — with no real surprises. The lion’s share of regulated platforms are developed by U.S. based for-profit firms, with a few international (mostly European) players in the mix, and one non-profit (the online encyclopedia Wikipedia). Read more
Binance.US pulls out of Voyager asset acquisition citing “hostile” regulations (Fintech Futures)
Crypto exchange Binance.US has pulled out of a deal to acquire beleaguered US-based crypto lender Voyager Digital’s assets. Binance.US says it has made the “difficult decision” to terminate the $1.022 billion deal, which was initially announced at the end of last year, citing “the hostile and uncertain regulatory climate” in the US as its reason for pulling out, claiming the country has introduced an “unpredictable operating environment impacting the entire American business community”. Voyager Digital, which filed for bankruptcy protection last year, reached an agreement with the Voyager Official Committee of Unsecured Creditors and the US government on 19 April for the purchase to go through, Cointelegraph reports. Read more
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