Are You in Control (of a Bank)? The Fed’s Proposed Framework for Presuming Control under the Bank and Savings and Loan Holding Company Acts
By Rebecca H. Laird, Dean A. Brazier and Daniel S. Cohen
On April 23, the Federal Reserve Board (the “FRB”) published a Notice of Proposed Rulemaking (“NPR”) to “simplify and increase the transparency,” while maintaining “consistency” to its determination of whether an entity “controls” a bank or a savings association (collectively, “depository institution”). According to the FRB’s announcement, the NPR is a first draft of a “comprehensive regulatory framework for control determinations.” FinTech companies seeking to become depository institutions should pay close attention to the NPR as it provides clear guidelines for when its investors would become subject to the Bank Holding Company Act (“BHCA”).
Read MoreASX Takes First Steps in introducing its Blockchain-Based Replacement to CHESS
By Jim Bulling, Felix Charlesworth and Andrew Fay
On 30 April 2019, Australian Securities Exchange (ASX) released the first of seven “drops” of software code into the “Customer Development Environment”. This marks the beginning of the introduction of the new equities clearing and settlement system, which ASX is developing to replace the existing CHESS system. The new system is based on distributed ledger technology (DLT) and promises to provide customers with access to real-time, synchronised, source-of-truth data.
Read MoreBank of Canada and Monetary Authority of Singapore jointly publish report on the use of blockchain in making cross-border payments
Jim Bulling and Felix Charlesworth
Two central banks have taken steps to facilitate cross border payments through the use of blockchain. On 1 May 2019, the Bank of Canada (BOC) and Monetary Authority of Singapore (MAS) jointly published a report on their trials of settling tokenised digital currencies across different blockchain platforms (Report).
Read MoreMake cryptocurrency by driving a Jag?! Sign us up
By Cameron Abbott and Allison Wallace
Firstly, no, you don’t have to be an Uber driver driving a Jag to reap the benefit of the car manufacturer’s new innovation.
Jaguar Land Rover has announced it is testing “Smart Wallet” technology that will enable drivers to earn cryptocurrency while driving.
How? Technology embedded in the car will automatically report road condition data, such as traffic congestion and potholes to navigation providers and local authorities, which will earn the car’s driver credits.
The credits can be used to buy coffee, pay tolls and parking tickets – which all sounds pretty handy to us.
Jag has partnered with IOTA Foundation which is providing the “IOTA-powered car wallet” which uses a distributed ledger technology to make and receive payments. It is currently being trialled in Ireland. IOTA forecasts that 75 billion devices will be connected to the Smart Wallet technology by 2025 – we’re pretty excited to see how this unfolds.
CFPB Seeking Comments On Possible Remittance Rule Revisions
By Daniel S. Cohen and Jeremy M. McLaughlin
On April 25th, the Consumer Financial Protection Bureau (“CFPB” or “Bureau”) issued a request for information (“RFI”) asking for input about the scope of its Remittance Rule (the “Rule”), whether the Bureau should exempt certain small financial institutions from the Rule, and how the expiration of the Rule’s “temporary exemption” for insured depository institutions and credit unions would adversely affect consumers. Comments are due 60 days after publication in the Federal Register.
Read MoreItaly’s legal recognition of blockchain-based timestamping
By Claude-Étienne Armingaud and Alessandra Feller
Italian law no.12/19 dated 11 January 2019 (the “Law”) came into force on 13 February 2019 and cemented the legal enforceability of electronic timestamping performed through blockchain technologies.
As part of a national reform pertaining to the simplification of administrative formalities for companies, the Law explicitly states in its Article 8 ter, 3° that “storage of a computerized document through the use of technologies passed on distributed ledger creates the same legal effect as ‘electronic time stamp’”, as defined in the European Regulation no. 910/2014 on electronic identification and trust services for electronic transactions dated 23 July 2014 (“eIDAS”).
Read MoreInternational Cryptocurrency Regulation Top of the Agenda for the Japan G20 Summit
By Jim Bulling, Felix Charlesworth and Andrew Fay
In the lead up to the annual G20 Summit, to be hosted by Japan, Prime Minister Shinzō Abe has commissioned the creation of a cryptocurrency governance manual. The manual, which will be distributed at the G20 Summit, supports a uniform approach to regulating cryptocurrencies and contains regulatory proposals and justifications relating to the following issues:
- protecting customer assets;
- international security protocols; and
- providing customers with information (particularly in the event of a hack).
More Companies Adopting Blockchain Solutions
By Susan Kayser, Christopher Bloom and Eric Lee
While still an emerging technology, more companies are implementing blockchain technology to manage supply chains, track goods, prevent counterfeiting, increase security, and ensure traceability. In a recent survey of global leaders, by auditing and financial services company KPMG, 48% of respondents stated they believe it is highly likely that blockchain will change the way their companies do business over the next three years, and 41% stated their company intends to implement blockchain technology during the next three years.
Read MoreLaunch of European joint platform for EU sandboxes and innovation hubs
By Giovanni Campi, Martina Topercerova and Jonathan Lawrence
On 2 April 2019, the European Commission announced the launch of the European Forum for Innovation Facilitators (“EFIF”). The EFIF will serve as a joint platform designed to foster collaboration and experience sharing among European financial supervisors on their engagement with FinTech firms through sandboxes and innovation hubs. On an ad-hoc basis, the European Supervisory Authorities (“ESAs”) and EU Member States’ National Competent Authorities (“NCAs”) will also be joined by third-countries’ authorities to exchange best practices, identify regulatory obstacles and share knowledge.
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