European nations to propose G20 rules on crypto-currencies
Germany and Italy are set to back a French proposal to regulate crypto-currencies within the G20 group of leading economies amid concerns that bitcoin and other digital tokens are being used for criminal activity. Germany’s finance ministry and other regulators are also monitoring developments in financial markets, particularly after the launch of bitcoin futures by US exchange CBOE and the planned rollout by Chicago-based rival CME. Valdis Dombrovskis, a vice-president of the European Commission, has written to EU banking authorities urging them to warn consumers of the risks of investing in bitcoin.
Lending risk clampdown consolidates China’s alternative credit sector
A crackdown on risk in the Chinese alternative lending industry is expected to concentrate control of the burgeoning sector in the hands of just a few firms, including Alibaba-backed Ant Financial and Lufax Holding. The authorities have begun closing lenders deemed to be illegal, obliging borrowers to turn to the remaining large groups that have greater capacity to analyse risk and creditworthiness. Credit extended by Chinese fintech firms is expected to increase more than sevenfold by 2022 to more than $900bn.
New OCC head plans to proceed with controversial fintech charter
Joseph Otting, who has taken over from Thomas Curry as the US Comptroller of the Currency, says he plans to proceed with his predecessor’s plans to implement a federal banking charter for fintech firms despite fierce opposition from state authorities. Otting says the OCC will conduct further studies into the requirements for the charter, which would regulate non-deposit taking fintech firms nationally rather than at the state level.
Wall Street Journal
Estonia e-residency programme plans estcoin crypto-token
Estonia could become the first country to launch an official crypto-token under plans outlined by the head of the government’s pioneering e-residency scheme. Kaspar Korjus says so-called estcoins could serve one of three purposes: providing rewards to the e-resident community, verifying identities online, or as a means of payment pegged to the euro. However, estcoins will not become a parallel currency following criticism from the European Central Bank.
Big data analytics enhancing regulatory insights globally
The Monetary Authority of Singapore is among a growing number of regulators worldwide exploring big data applications to ‘nowcast’ their economies, enabling them to predict near-future events and gain deeper insights into the present and recent past. By combining publicly-available data from sources such as Google Trends, jobs websites and real estate portals with confidential information such as credit registers, regulators are able to gauge economic trends more accurately and even pinpoint a stressed bank.