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Tag: accelerating
Compared with developed economies, emerging economies are generally more motivated to develop general-purpose CBDC projects.
Original title: “New Crown accelerates the CBDC process, 20% of the world’s population is expected to hold CBDC within 3 years”
Written by: Mori Goro
Central banks in emerging markets believe that CBDC can help promote financial inclusion, improve financial stability, and increase payment efficiency and security. Central banks in developed countries believe that digital currencies are “very important” for improving payment security.
2020 is the first year of the well-deserved digital currency. In October 2020, the central banks of G7 countries and the Bank for International Settlements (BIS) issued a digital currency feasibility report “Central Bank Digital Currency: Basic Principles and Core Features”.
Last month, the Bank for International Settlements conducted a survey of central banks in 65 countries around the world. The report showed that 86% of central banks are exploring the advantages and disadvantages of CBDC, an increase of nearly 53 percentage points from 33% four years ago. Among the central banks of the countries participating in the survey, 20 countries are developed countries and 45 countries are developing countries, covering 75% of the global population, including:
Data source: Bank for International Settlements
As shown in the figure, 60% of the central banks surveyed have already launched their own CBDC projects, and more and more central banks are preparing. 20% of central banks stated that they can issue CBDC within 6 years. At the same time, the report concludes: 20% of the world’s population is expected to hold CBDC within 3 years.
However, most central banks are still unlikely to issue CBDC in the foreseeable future, about 70%. Some central banks with advanced CBDC projects have become more and more cautious in assessing their issuance time limits. At the same time, people are increasingly aware of the cross-border impact of CBDC on the financial system, prompting international cooperation among central banks to find common ground in policies.
The report stated: “Compared with advanced economies, emerging economies are generally more motivated to develop general-purpose CBDC projects.” Data from central banks in emerging markets show that CBDC can help promote financial inclusion, improve financial stability, and increase payment efficiency and safety. At the same time, it is clear that central banks in developed countries believe that digital currencies are “very important” for improving payment security.
The new crown accelerates the CBDC process, and the acceptance of national financial subsidies becomes higher
The report shows that Covid-19 has accelerated payment digitization and added new momentum to CBDC. Central banks try to find a balance between urgency and caution.
About 60% of central banks said that the new crown crisis has not changed their country’s priority or preference for issuing CBDC. For those central banks that have changed their stance on CBDC due to the new crown crisis, the main reason is related to the problem of central bank funds reserves. The social distance of the new crown has undoubtedly greatly promoted the development of online payment and electronic money. During the new crown period, the use of CBDC as a payment method has also been widely recognized in the financial assistance of national subsidies and revitalization policies.
Although the central banks of most countries said that the cash in circulation in their countries has not decreased, the cash used for payment has decreased significantly, which has become one of the motivations for countries to support the issuance of CBDC. Under the new crown epidemic, the changes in people’s consumption patterns have not only directly disrupted companies, but also constantly changed their perceptions of money.
Bahamas officially certified the first CBDC project
The only project currently recognized by the Bank for International Settlements is the Bahamas CBDC project. Linked also mentioned in the previous article that the Central Bank of the Bahamas has started issuing the digital currency Sand Dollar on October 20.
Other emerging economies
On October 28th, Chia Serey, Director of the Central Bank of Cambodia, announced that Bakong planned to complete the trial operation and has issued the digital currency “Bakong Coin”. As early as November 2016, the Monetary Authority of Singapore (MAS) introduced the Ubin project and cooperated with R3 to establish a proof-of-concept project to use blockchain technology for inter-bank payments. For details, please refer to the exclusive news of Linkdede: Looking back at the first year of CBDC: China has already drawn, Europe, America and Japan are vying to chase.
Chinese “Renmin Yuan”
Everyone is familiar with the digital currency “Renmin Yuan” of the People’s Bank of China. In terms of operation and pilot projects, China has already taken the lead. However, the closed domestic pilots are like enemies in Europe, America and Japan. For details, please refer to the previous report of Linkde: G7 held an emergency meeting last night in an attempt to restrain the issuance of digital renminbi.
India rejects digital currency and expects to issue central bank digital currency
Recently, India discussed the “Digital Currency Regulatory Act” submitted in the previous few days in Congress. The bill basically prohibits the investment and use of all digital currencies.
At the end of January, the Indian House of Representatives homepage released the discussion agenda of the bill, including the “Digital Currency and Official Digital Currency Regulatory Bill.” The outline of the bill states: “A framework will be established to promote the issuance of official digital currencies by the Reserve Bank of India (Central Bank)”, and “digital currencies issued by all companies will be prohibited.” Investment-related digital currencies exist.
At present, this bill has not yet reached a final conclusion, but it is certain that the form of existence of digital currency in India has been restricted to the scope of central bank digital currency. On February 11, local media in India reported that investors who illegally hold digital currencies need to turn in or dispose of their digital assets within 3-6 months after the passage of the bill.
Investors are very wary. At present, many giant investors in India have jointly called for orders on Twitter, but in terms of actual results, they have little influence. Regarding Musk’s crazy entry into the game at the beginning of the month, in India, the relevant person in charge of the Reserve Bank of India said:
“We are skeptical of digital currencies and cryptocurrencies issued by companies, and the risks involved are too high.”
Although speculative trading and investment in digital currencies are prohibited, one trend is that India is preparing to issue central bank digital currencies.
Japan’s “Nebula Project” only owes east wind
The Japanese market has a very early enlightenment on the trading and use of digital currency, and it was once the center of digital currency exchanges. Although its status has plummeted after the Coincheck incident in 2017, the Bank of Japan has invested heavily in the “Project Stella”. Big.
In 2018, a reporter from Linkdee stationed in Japan directly interviewed the director of the Bank of Japan’s “Project Stella” (Project Stella), the director of the Bank of Japan’s FinTech Center, Toyo Shima. He said that after several visits to Shanghai and other places, Japan Banks are also actively promoting the development of CBDC projects. As of February this year, the Bank of Japan CBDC, which has entered the second phase, has been delayed due to the new crown, but the development of technical support (European Union), market (domestic popularity) and acceptance (national use and investment enthusiasm) It is relatively complete, and the speed of launch and popularization is likely to exceed that in China.
European developed countries lag behind
In developed countries in Europe, there is no central bank that takes the lead, and the European Union has not yet launched its own central bank digital currency. However, the European Union has conducted a systematic and comprehensive study on the theory, influence, and technical implementation of central bank digital currency. In October 2020, the European Union released the “Digital Euro Report”, which systematically explained the digital euro.
However, there are occasional news about private CBDC projects, such as Sweden’s ongoing “e-crona” trial. Electronic payments are already common in the country, and the cash usage rate is as low as about 2%. The Swedish project is mainly led by private private enterprises, but from the perspective of information processing and the effectiveness of Swedish monetary policy, it also plays an important role in the CBDC project.
Disclaimer: As a blockchain information platform, the articles published on this site only represent the author’s personal views and have nothing to do with ChainNews’ position. The information, opinions, etc. in the article are for reference only, and are not intended as or regarded as actual investment advice.
In the future market, investment needs more specialized calculations and research, and risks need to be disclosed more transparently and strictly managed. In this irreversible wave, professional institutions gradually stand at the center of the stage.
Written by: Ad
In 2020, in addition to Bitcoin once climbing to a high point, Ethereum 2.0 and distributed financial DeFi are also rapidly emerging, becoming the most cutting-edge new outlets in the blockchain industry. At the same time, global mainstream payment institutions such as VISA, MasterCard and Paypal have also accelerated their deployment in the field of blockchain and digital asset payment. The New Deal of the U.S. Banking Regulatory Department allows banks to provide customers with digital asset custody services. Catalyzed by this series of positive factors, the digital financial market ushered in a new stage of development.
Traditional financial institutions are running into the market. This is a market-specific consensus starting in 2020. The once rash development of the digital financial industry is gradually fading away from its green appearance. The crazy bull market for retail investors that occurred in 2017 is gone forever.
The frequency of the occurrence of “under the sand” and “chickens and dogs ascend to heaven” will gradually decrease; in the next market, investment requires more professional calculations and research, and risks need to be disclosed more transparently and strictly managed. In this irreversible wave, professional institutions gradually stand at the center of the stage.
In the second quarter report on the digital financial product lending market, Credmark counted 85% of lending company data. In the second quarter of 2020, the scale of existing loans in this field reached US$4.632 billion, an increase of 90.62% from the previous quarter; the value of collateral exceeded US$8 billion in the same period. , An increase of 87.34% month-on-month.
Institutional customers dominate the digital financial lending market. In the second quarter of 2020, the stock loan ratio between institutions and retail investors was 3.5:1; the value ratio of institutional and retail collateral in the same period was 2:1. From the difference in the ratio of the value of stock loans and collateral, it can be found that institutional customers do have a very obvious advantage in the pledge rate.
So, where is the development of professional service providers in the market now? Does the new wealth management product really meet the needs of the market? In the future development, how should these service providers strive to seize market opportunities? This issue of Chain News will take everyone to explore the development status of service organizations in the digital financial field.
Overview of existing digital financial service institutions
So far, the current institutions providing digital financial services are mainly exchanges, wallets and professional financial service providers. The cost of launching financial services on the basis of supporting cryptocurrency transactions is relatively low. For wallets and financial service providers, the cost of supporting asset mainnets and user drainage has certain obstacles to their development of financial services, but this is also one of the opportunities for them to stand out from the track.
Exchange
Binance <br>As the world’s leading exchange, Binance’s Binance Wealth Management provides one-stop integrated wealth management products and services. There are four categories of current products, fixed-term products, new currency mining, and asset management. Users can Perform asset management according to your own financial preferences.
Current wealth management is mainly Binance Deposit, which deposits digital assets on the Binance platform, deposit and withdrawal, similar to bank demand deposits. As the name implies, regular wealth management products are assets deposited or pledged for a fixed period of time. They are divided into four categories: Binance’s regular and irregular high-yield activities, lock-up staking, and DeFi mining. New currency mining refers to users participating in new currency mining projects by providing pledged digital assets. Asset management mainly refers to two categories: liquidity mining and dual currency investment.
OKEx
OKEx’s financial products mainly focus on the three major products of Yubibao, lending and earning coins. Yubibao mainly has four forms: current, regular, event and holding rebates. Users can receive currency-based wealth management income through simple deposits in Yubibao, deposit and withdraw as soon as the funds are transferred, and can transfer the currency in the account to Yubibao account to obtain income, or transfer Yubibao’s coins to other accounts . It combines a variety of wealth management services, including currency value-added products, lock-in mining, loan investment terminals, and third-party DeFi services to provide users with more interest-bearing options. At present, coin-earning products have supported nearly 30 encrypted digital currencies including lock-up mining and Yubibao.
wallet
<br> wheat wheat wallet purse (MathWallet) is a general-purpose encryption wallet assets, has been upgraded to MATH, MATH relying on the wallet, is a multi-link chain and across the core of the block chain assets Hub, is the first to support the Intelligent currency One of the crypto asset wallets of the chain (BSC). Maizi Wallet includes four major financial services: investment, wealth management, lending, and payment. At the same time, the MATH VPoS mining pool has been launched to mortgage digital assets. It can also automatically reinvest according to the daily interest rate to maximize returns.
Binyin Wallet <br>Blockinwallet was established in September 2019. It is a Singapore financial service platform under Binyin Mining Pool. Its customer base is mainly for miners and wallet users. It is currently applying for MAS compliance supervision. The Binyin mining pool was founded in November 2017 and was established by the original core team of BTC.com. It supports mining in all mainstream currencies. Its computing power for BTC, ZEC, LTC and other currencies often ranks first.
HyperPay
HyperPay is a digital asset wallet that integrates custodial wallets, self-managed wallets, co-managed wallets, hardware wallets and other services. It also has wealth management, currency transactions, legal currency transactions, lightning exchange, mortgage lending, market tracking, multi-signature co-management, and assets Hosting, merchant payment and other functions. HyperPay business is oriented to both B-side and C-side users. For ordinary currency holders, you can choose to manage financial wallets. For large asset customers and institutional users, you can choose self-managed wallets and co-managed wallets or customized hardware wallet solutions.
Professional financial service provider
Matrixport
Matrixport is a one-stop digital asset financial service platform, which mainly provides digital asset trading, lending, custody and payment services for enterprises and individual users. Matrixport is a digital asset financial service platform established by Bitmain co-founder Wu Jihan. CEO Ge Yuesheng and founding team members are also from Bitmain. The company is headquartered in Singapore, with offices in Hong Kong, Switzerland and other places. Matrixport has launched digital currency transactions, digital currency custody, pledged loans and other products, and more innovative products will be launched one after another.
PayPal Finance <br>PayPal Finance is a comprehensive encrypted financial service provider. PayPal was established in August 2018. It mainly provides encrypted asset deposits and loans, asset management, brokerage, and brokerage for high-net-worth qualified individual investors and institutional investors. Comprehensive financial services such as derivatives trading. After PayPal Finance established its core customer base, it gradually launched customized new products based on customer needs, such as the official PayPal Private, which is similar to China Merchants Bank Golden Sunflower’s private customized services for high-net-worth customers.
RenrenBit
RenrenBit (RenrenBit) is a blockchain digital bank that focuses on C2C digital asset lending services. The platform provides information matching between borrowers and lenders, pledge custody and risk control. Its founder is Zhao Dong, an early practitioner of the currency circle, a shareholder of Bitfinex, and a major OTC trader.
From the perspective of market development, the current wealth management products that are highly accepted in the digital currency field and have a wider range of users are mostly single-currency gain-based products with stable returns and low risks. With the expansion of the financial attributes of digital currency derivatives, more institutions and investors have more abundant and differentiated requirements for the allocation and benefits of financial solutions.
Some investors are willing to pursue medium and high-yield diversified wealth management products on the basis of taking certain risks. More diversified investment categories such as dual currency wealth management, staking, lending, and strategic trading pioneered by Matrixport are gradually appearing in the market. Have a place on top.
Lianwen will start with Matrixport and analyze its layout of its financial products to explore how professional service providers can seize market opportunities in the digital finance era and expand their services to a wider range of financial institutions and high-net-worth individuals.
Matrixport’s road to digital finance: comprehensive products and services
Digital financial professional service providers first helped miners to hedge their risks and protect the value of their assets. But in the more than ten years of vigorous development of cryptocurrency, participants have evolved from early cypherpunks to Bitcoin miners, and expanded to more and more mainstream investment institutions. Cryptocurrency has moved from a small circle to a larger world. These changes have accelerated the emergence of the professional field of digital financial services.
According to functions and needs, Matrixport’s products can be divided into loan and wealth management, asset custody, trading and one-click “CeDefi” products. Matrixport provides digital asset financial services for mining machines, mining pools, quantitative funds, digital currency lending platforms, digital currency funds, exchanges, OTC traders, etc., and has launched more than 50 products from product categories.
Borrowing and financing
On the road to inclusive digital finance in the encrypted world, Matrixport equips the market with comprehensive products and services in a timely manner, and constantly updates according to the market to meet the financial needs of customers at different stages, helping customers to reduce risks, achieve wealth preservation, and increase value. .
From the perspective of Matrixport loan products, it is mainly divided into two types: basic loan and “zero interest loan”. The basic loan product supports the borrowing of USDC, USDT, BTC, BCH, ETH, LTC, and supports four pledge coins of BTC, BCH, ETH and LTC. The basic loan amount is between 1,000 USDT and 200,000 USDT, and large borrowing needs can be purchased through customized products. Matrixport’s zero-interest loan product integrates stop-profit and stop-loss products into digital currency loan products. The loan product mainly has three features: zero interest, no need to cover up and crash protection, which provides a strong guarantee for miners’ fund protection under extreme market conditions. Matrixport provides miners with a zero-interest loan solution, which not only better avoids risks, but also solves the pressure on the flow of funds of miners.
In addition, Matrixport also created the first dual currency wealth management product in the industry in October 2019. This novel product quickly became popular in the industry after it was launched. It gained the attention and use of users in more than 20 countries within a month of going online. , Binance also launched similar products.
Different from the traditional form of digital currency wealth management, dual currency wealth management products judge the settlement method based on the “pegged price” to ensure that one of the two digital assets will receive income. For example, BTC/USD(S) dual currency investment, the pegged price is “8000 USD”. When the BTC market price is lower than 8000 USD, the settlement will be priced in BTC, and the income will be more BTC; when the BTC market price is higher than 8000 USD, It will be settled in USDC and will earn more USDC. Provide customers with a tool to automatically buy bottom and cash out at the target price (pegged price). At present, dual currency wealth management provides several products including Bitcoin, Ethereum, and USD stable currency. The optional purchase period ranges from 1 day to 163 days, which can provide higher annualized income (30-200% annualized as common Income range).
As the first company in the industry to launch dual currency wealth management services, Matrixport’s dual currency wealth management products mainly include BTC, ETH and BCH three mainstream crypto assets. The optional purchase period of the products ranges from 1 day to 140 days. There are six major products. The highest annualized rate of return exceeds 900%.
Relatively speaking, Binance Dual Currency Wealth Management products were officially launched on August 20. They are mainly divided into three major product areas: BTC area, USDT area and BUSD area. However, its dual currency wealth management products are currently sold due to limit restrictions. Out of stock, the official annualized rate of return ranges from 6.00% to 160.00%.
Asset custody
Cactus Custody is a third-party institutional custody service provider launched by Matrixport and a Hong Kong trust company. Cactus custody originated from Bitmain’s internal custody system, and later developed into a fully functional third-party custody after Matrixport was separated from Bitmain.
Since most of the customers who need custodial services are 2B customers, security and business continuity are paramount to both customers and service providers. For security, Cactus Custody chose to manage private keys in the industry’s highest-level HSMs (hardware security modules) and a proprietary multi-layer heating and cooling storage system. The core custody infrastructure is deployed in the four-level data center of the bank vault on three continents. Eliminate single points of failure through system heterogeneity, dual-center settings and remote disaster recovery mechanisms to ensure the highest security and business continuity. Also through the design of responsibility isolation and zero trust system, it is guaranteed not to rely on any single person.
In terms of compliance, Cactus Custody not only holds a Hong Kong TCSP license, but also strictly abides by the “anti-money laundering” regulations in all operating jurisdictions, conducts KYC with the highest standards, and has suspicious transaction reporting procedures for on-chain and off-chain transactions. In addition, Cactus Custody also cooperates with Elliptic to integrate on-chain transaction monitoring, and monitors all on-chain transactions through Cactus Custody and Matrixport to meet regulatory requirements and protect customers from digital financial crimes.
Up to now, Cactus Custody can support 39 digital assets, and safeguard the security of more than 50 institutional customers and digital assets worth about 1 billion U.S. dollars, and provide customers with uninterrupted, highest-quality asset security and business continuity guarantees.
transaction
Bit.com is a professional derivatives exchange launched by Matrixport and specializes in options. Bit.com’s strategic positioning is to serve institutional and individual clients from all over the world, including miners/hedges, prime brokers, proprietary dealers and funds.
Bit.com’s self-built transaction engine with all intellectual property rights provides matching of 10,000 TPS per second, and introduces a portfolio margin mechanism to improve the efficiency of the institution’s capital use. At the same time, it adopts a more scientific and gentle gradual liquidation mechanism to provide maximum customer positions protection of. Thanks to its lending business and transaction engine, Matrixport can provide the lowest interest rates and transaction prices in the industry, allowing the cost of leveraged transaction customers to be significantly controlled.
In the six months since its launch, Bit.com has reached a level of about 200 million US dollars in daily trading volume. In addition, Bit.com also launched BCH options on February 1 to fill the gap in the BCH options market.
One-click “CeDefi” product
The DeFi fire in 2020 is a portrayal of the urgent needs of market participants for diversified financial products. However, due to the high learning costs and operational difficulties for ordinary users such as liquid mining, and the large amount of funds entering the market The interaction cost of the Ethereum network has risen sharply, and the DeFi boom is still far from achieving true “inclusiveness” from the level of the number of users.
In response to this situation, Matrixport has launched a simplified one-click “CeDefi” product in response to market demand, taking into account the convenience of Cefi and the flexibility and transparency of Defi, and has launched a series of products that are well received by the market, such as current machine gun pool and smart selection And other products, it can help customers automatically switch between different DeFi high-yield projects, compound interest investments, current or large T+1 redemptions, and combined with mortgage lending, that is, mortgage BTC/BCH/ETH and other currencies to lend USDC/USDT for liquidity Functional mining and other functions enable BTC/BCH/ETH holders to directly invest in DeFi income, which greatly facilitates customers and enriches the scene.
At the same time, Matrixport also provides users with a combination of DeFi and derivatives investment product “Trend Zhiying” to help customers obtain excess returns in unilaterally rising or falling markets.
The power of digital financial services
Digital financial professional service institutions can provide a complete system and relatively personalized services, which can adapt to different customer needs, and are also convenient for supervision by regulatory authorities, so as to achieve compliance and legal operations and reduce systemic risks. In the long-term development and precipitation of traditional financial models, countless operating models and new gameplay have evolved, and these traditional financial derivatives have gradually infiltrated the digital financial field of encrypted currencies.
Matrixport first launched its product in October 2019, and it has been online for 1 year and 4 months. In the past year or so, Matrixport has accumulated trust and reputation in the industry based on its rich financial product matrix and product innovation speed, rigorous and prudent risk control management, and professional compliance operations. Criticize quite loyal “fans.”
Matrixport CEO Ge Yuesheng told Lianwen, “Matrixport’s AUM (asset management scale) has exceeded 1 billion U.S. dollars in just over a year, and its loan balance exceeds 200 million U.S. dollars. The current wealth management scale exceeds 300 million dollars.”
With the expansion of services to a wider range of financial institutions and high-net-worth individuals, Ge Yuesheng hopes that Matrixport’s vision to become a “digital currency bank” is gradually being implemented. In 2021, Matrixport will shift its focus from building a product matrix and service system to market and customer service. Investment in this area will continue to increase, and the service area will also expand to more regions in Asia Pacific and Europe.
As Ge Yuesheng said, “In this era of digital financial services, Matrixport hopes to continue to lead the digital currency industry in innovative financial services and bring more professional and secure services and products to the industry.”
summary
“2020 is not only the first year of digital currency financial services, but also the first year of mining financial services. A large number of structured products and lending products have experienced explosive growth and applications in 2020.” Ge Yuesheng was talking about 2020 The changes in digital financial services in the year are expressed.
Digital finance is accelerating, and the industry has ushered in structural changes. How to comprehensively deploy and provide precise services is the focus of development. A complete and leading product line, combined with professional and efficient security services, will enable the project to have a better market reputation and customer reviews. Based on the deep cultivation of the industry and the understanding of the market, Ge Yuesheng believes that 2021 will be a surging bull market, and preparing for a large number of customers and institutional funds will become the focus of Matrixport in 2021.
In Ge Yuesheng’s view, the reason why Matrixport has been able to develop into an industry-leading professional financial services organization so quickly is that, compared with its peers, it must always emphasize “full service” based on its rich industry resources and leading technical capabilities. “And “Professional Products”. Services and products increase user stickiness, and the synergy between businesses can also make a single product more competitive.
Author: MYKEY researcher Yao Xiang
Original title: “Encrypted Stable Coin Report 22: The Inside and Face of Stable Coins”
To help crypto market participants keep updated on the development status of stablecoins, we launched the MYKEY stablecoin report to share our interpretation of the development status of stablecoins and analysis of their development trends. Looking forward to maintaining exchanges with the industry and exploring the development prospects of stablecoins together. Welcome to leave suggestions.
Quick preview
The circulating market value of major stablecoins reached US$25.25 billion, an increase of US$2.540 billion in the past month, an increase of 14.1%.
In the past month, the circulation of USDT, USDC, DAI, and TUSD increased by 2.414 billion, 33 million, 124 million, and 52 million respectively; the circulation of the remaining stablecoins dropped slightly.
The circulation of DAI exceeded USD 1 billion; the circulation of USDC exceeded USD 3 billion.
The stablecoin continues to go out of the circle, and Circle uses USDC to assist Venezuelan medical staff.
Libra may be available as soon as January 2021.
1. Overview of stablecoin data
In the past month (November 1, 2020-November 30, 2020, the same below), the data of each stable currency has increased significantly.
Market circulation
Source: MYKEY, CoinMarketCap, Coin Metrics
Currently, the circulating market value of major stablecoins has reached US$25.25 billion, an increase of US$2.540 billion in the past month.
Source: MYKEY, Coin Metrics
Among them, the main growth comes from Tether. Tether has issued a total of 2.413 billion additional shares, specifically 1.313 billion Ethereum and 1.100 billion TRON. USDC’s circulation increased by 33 million, breaking through the $3 billion mark on November 30. The circulating volume of TUSD increased by 52 million, and the circulating volume of DAI increased by 124 million, breaking through the $1 billion mark; the circulating volume of PAX, BUSD, HUSD, and GUSD decreased by 26 million, 18 million, 36 million, and 1.41 million, respectively.
Number of active addresses
Source: MYKEY, Coin Metrics
Last month, the average daily active addresses of major stablecoins increased by 3.73%.
24 hours on-chain transactions
Source: MYKEY, Coin Metrics
Compared with the previous month, the daily average number of transactions for major stablecoins increased by 0.98%. Among them, the growth rate of USDC is remarkable, from an average of 33,400 transactions per day to 48,300, an increase of 44.7%.
24-hour on-chain transaction volume
Source: MYKEY, Coin Metrics
Source: MYKEY, Coin Metrics
The average daily transaction volume of major stablecoins increased by US$604 million, an increase of 13.97%. On October 26, Harvest Finance was attacked and stolen $34 million. On-chain transactions fluctuated significantly (the crest in the figure). Excluding the impact of data on the day, the increase can be revised to 37.97%.
2. Stable coins are booming
The entire stablecoin ecosystem is prospering. The amount of funds has steadily increased, and the decentralized stable currency DAI has reached the milestone of 1 billion US dollars; financial services are becoming more and more perfect, and the compliant stable currency USDC plans to provide a deposit plan with the highest annualized return of 10.75%; benchmark products are about to come out, Libra may be in 2021 It officially came out in January.
DAI supply exceeded 1 billion US dollars
On November 13, 2020, the supply of DAI exceeded US$1 billion, and only 71 days have passed since it exceeded US$500 million. The rapid growth of data comes from the demand side on the one hand. The demand for DAI continues to grow due to liquidity mining and rising market trends; on the other hand, it also comes from the supply side. The debt ceiling of ETH-A has been raised to US$490 million. The USDC-A debt ceiling has also reached 485 million U.S. dollars, and the utilization rate is over 80%. The USDC locked in the Maker agreement has already accounted for 13% of the total supply of USDC. In contrast, the contribution of newly-added collateral to the generation of DAI is limited. Since October, the total contribution of newly-added collateral assets COMP, LRC, LINK, BAL, YFI, and GUSD to DAI is US$26.30 million, accounting for 2.5% of the total. , Except for YFI, only 0.5%. (Data Sources:)
Circle announces high-yield savings plan, up to 10.75%
On November 5, 2020, Circle officially announced that it will provide USDC current and regular savings plans. According to the official website, the current interest rate is 8.5%, and the regular plan is divided into four types: 1 month, 3 months, 6 months, and 1 year, with interest rates ranging from 9.5% to 10.75%. Circle will cooperate with Genesis Global Capital on the savings product, and the proceeds will come from lending dollars to institutional counterparties willing to pay interest.
At present, the savings product has not been officially launched. Users can fill in the information to apply for joining the waiting list.
The Financial Times said Libra could come out as early as January 2021
On November 27, 2020, the British “Financial Times” stated that the stablecoin project Libra led by Facebook may come out as early as January 2021. According to relevant sources, initially only one stablecoin fully secured by US dollars will be launched, but other currencies and combined stablecoins will be launched later.
Three sources said that the specific launch date of Libra will depend on when the project is approved by the Swiss Financial Market Supervisory Authority (FINMA) to provide payment services, but it may be January next year at the earliest. FINMA said it would not comment on Libra’s application.
Third, stablecoins accelerate the pace of out of the circle
The acceleration of stablecoins out of the circle has not only attracted the attention of more countries or international regulatory agencies, but also gradually expanded application scenarios. In November, Circle announced the use of USDC to assist medical workers in Venezuela, showing that the application of stablecoins is not only limited to the world of cryptography. In October, after successively releasing the regulatory reports on stablecoins, the UK Ministry of Finance stated that it would develop a regulatory framework for stablecoins, and the Bank for International Settlements (BIS) also issued a regulatory report on stablecoins.
Circle uses USDC to assist Venezuelan medical staff
In November, the supply of USDC has reached 3 billion U.S. dollars, and its application scope is gradually integrated with the real world. According to the cooperation between Circle and local governments and financial platforms, funds are allocated to COVID-19 health care workers in South American countries, and this process is done through USDC.
According to the chain, the specific process can be simplified as follows: The U.S. Department of the Treasury and the Federal Reserve release funds to Guaidó’s government account in a U.S. bank. The Guaidó government uses these funds to mint USDC and send them to blocks denominated in U.S. dollars. The chain payment platform Airtm is then distributed to the accounts of Venezuelan medical staff in the form of AirUSD, and the medical staff can withdraw to the local bank account.
The UK Ministry of Finance will develop a stablecoin regulatory framework
In the UK Treasury Department’s November 9th, the British Chancellor of the Exchequer Sunak stated that after the UK leaves the European Union, the government’s attitude towards financial services will be guided by the most productive and innovative industries. The UK’s financial industry should “lead the global dialogue on new technologies such as stablecoins and central bank digital currencies”, which will consolidate the UK’s leading position in the field of financial technology.
The statement mentioned that new technologies such as stablecoins may change the way people store and trade currencies, making payments cheaper and more convenient. In order to play to the potential value of stablecoins and manage the risks of consumers and financial stability, the government will propose regulatory measures for related stablecoin programs to ensure that they meet the minimum requirements for payment methods.
The Bank for International Settlements releases stablecoin report detailing risks, opportunities and regulation
The Bank for International Settlements (BIS) released on November 24-“Stablecoins: Risks, Opportunities and Regulations”, detailing the potential role of stablecoins and their implications for regulation. The report outlines the market development of existing stablecoins and describes their potential to embed powerful currency tools in the digital environment. It believes that stablecoins are designed to challenge existing e-commerce digital payment methods, including traditional bank payments, credit cards and Electronic wallets, etc. At the same time, stablecoins, especially the Libra project led by Facebook, also pose a challenge to the global financial system. The report analyzes and discusses the Libra project and related regulatory countermeasures, and believes that the supervision of stablecoins should be based on the many conveniences it may provide, not limited to the existing regulatory framework, and consider implementing “embedded supervision”, namely Directly embed the regulatory requirements into the realization of the “global stablecoin” system.
The MYKEY stablecoin report in this issue has been shared, please stay tuned. We will provide you with more analysis of the development status, trends and international impact of stablecoins, and help readers continue to update their understanding of the development of stablecoins.
Note: MYKEY Lab has the final right to interpret the content of the article, please indicate the source of the citation. Welcome to follow the MYKEY Lab official account: MYKEY smart wallet.
Author: MYKEY researcher Yao Xiang
Original title: “Encrypted Stable Coin Report 22: The Inside and Face of Stable Coins”
To help crypto market participants keep updated on the development status of stablecoins, we launched the MYKEY stablecoin report to share our interpretation of the development status of stablecoins and analysis of their development trends. Looking forward to maintaining exchanges with the industry and exploring the development prospects of stablecoins together. Welcome to leave suggestions.
Quick preview
The circulating market value of major stablecoins reached US$25.25 billion, an increase of US$2.540 billion in the past month, an increase of 14.1%.
In the past month, the circulation of USDT, USDC, DAI, and TUSD increased by 2.414 billion, 33 million, 124 million, and 52 million respectively; the circulation of the remaining stablecoins dropped slightly.
The circulation of DAI exceeded USD 1 billion; the circulation of USDC exceeded USD 3 billion.
The stablecoin continues to go out of the circle, and Circle uses USDC to assist Venezuelan medical staff.
Libra may be available as soon as January 2021.
1. Overview of stablecoin data
In the past month (November 1, 2020-November 30, 2020, the same below), the data of each stable currency has increased significantly.
Market circulation
Source: MYKEY, CoinMarketCap, Coin Metrics
Currently, the circulating market value of major stablecoins has reached US$25.25 billion, an increase of US$2.540 billion in the past month.
Source: MYKEY, Coin Metrics
Among them, the main growth comes from Tether. Tether has issued a total of 2.413 billion additional shares, specifically 1.313 billion Ethereum and 1.100 billion TRON. USDC’s circulation increased by 33 million, breaking through the $3 billion mark on November 30. The circulating volume of TUSD increased by 52 million, and the circulating volume of DAI increased by 124 million, breaking through the $1 billion mark; the circulating volume of PAX, BUSD, HUSD, and GUSD decreased by 26 million, 18 million, 36 million, and 1.41 million, respectively.
Number of active addresses
Source: MYKEY, Coin Metrics
Last month, the average daily active addresses of major stablecoins increased by 3.73%.
24 hours on-chain transactions
Source: MYKEY, Coin Metrics
Compared with the previous month, the daily average number of transactions for major stablecoins increased by 0.98%. Among them, the growth rate of USDC is remarkable, from an average of 33,400 transactions per day to 48,300, an increase of 44.7%.
24-hour on-chain transaction volume
Source: MYKEY, Coin Metrics
Source: MYKEY, Coin Metrics
The average daily transaction volume of major stablecoins increased by US$604 million, an increase of 13.97%. On October 26, Harvest Finance was attacked and stolen $34 million. On-chain transactions fluctuated significantly (the crest in the figure). Excluding the impact of data on the day, the increase can be revised to 37.97%.
2. Stable coins are booming
The entire stablecoin ecosystem is prospering. The amount of funds has steadily increased, and the decentralized stable currency DAI has reached the milestone of 1 billion US dollars; financial services are becoming more and more perfect, and the compliant stable currency USDC plans to provide a deposit plan with the highest annualized return of 10.75%; benchmark products are about to come out, Libra may be in 2021 It officially came out in January.
DAI supply exceeded 1 billion US dollars
On November 13, 2020, the supply of DAI exceeded US$1 billion, and only 71 days have passed since it exceeded US$500 million. The rapid growth of data comes from the demand side on the one hand. The demand for DAI continues to grow due to liquidity mining and rising market trends; on the other hand, it also comes from the supply side. The debt ceiling of ETH-A has been raised to US$490 million. The USDC-A debt ceiling has also reached 485 million U.S. dollars, and the utilization rate is over 80%. The USDC locked in the Maker agreement has already accounted for 13% of the total supply of USDC. In contrast, the contribution of newly-added collateral to the generation of DAI is limited. Since October, the total contribution of newly-added collateral assets COMP, LRC, LINK, BAL, YFI, and GUSD to DAI is US$26.30 million, accounting for 2.5% of the total. , Except for YFI, only 0.5%. (Data Sources:)
Circle announces high-yield savings plan, up to 10.75%
On November 5, 2020, Circle officially announced that it will provide USDC current and regular savings plans. According to the official website, the current interest rate is 8.5%, and the regular plan is divided into four types: 1 month, 3 months, 6 months, and 1 year, with interest rates ranging from 9.5% to 10.75%. Circle will cooperate with Genesis Global Capital on the savings product, and the proceeds will come from lending dollars to institutional counterparties willing to pay interest.
At present, the savings product has not been officially launched. Users can fill in the information to apply for joining the waiting list.
The Financial Times said Libra could come out as early as January 2021
On November 27, 2020, the British “Financial Times” stated that the stablecoin project Libra led by Facebook may come out as early as January 2021. According to relevant sources, initially only one stablecoin fully secured by US dollars will be launched, but other currencies and combined stablecoins will be launched later.
Three sources said that the specific launch date of Libra will depend on when the project is approved by the Swiss Financial Market Supervisory Authority (FINMA) to provide payment services, but it may be January next year at the earliest. FINMA said it would not comment on Libra’s application.
Third, stablecoins accelerate the pace of out of the circle
The acceleration of stablecoins out of the circle has not only attracted the attention of more countries or international regulatory agencies, but also gradually expanded application scenarios. In November, Circle announced the use of USDC to assist medical workers in Venezuela, showing that the application of stablecoins is not only limited to the world of cryptography. In October, after successively releasing the regulatory reports on stablecoins, the UK Ministry of Finance stated that it would develop a regulatory framework for stablecoins, and the Bank for International Settlements (BIS) also issued a regulatory report on stablecoins.
Circle uses USDC to assist Venezuelan medical staff
In November, the supply of USDC has reached 3 billion U.S. dollars, and its application scope is gradually integrated with the real world. According to the cooperation between Circle and local governments and financial platforms, funds are allocated to COVID-19 health care workers in South American countries, and this process is done through USDC.
According to the chain, the specific process can be simplified as follows: The U.S. Department of the Treasury and the Federal Reserve release funds to Guaidó’s government account in a U.S. bank. The Guaidó government uses these funds to mint USDC and send them to blocks denominated in U.S. dollars. The chain payment platform Airtm is then distributed to the accounts of Venezuelan medical staff in the form of AirUSD, and the medical staff can withdraw to the local bank account.
The UK Ministry of Finance will develop a stablecoin regulatory framework
In the UK Treasury Department’s November 9th, the British Chancellor of the Exchequer Sunak stated that after the UK leaves the European Union, the government’s attitude towards financial services will be guided by the most productive and innovative industries. The UK’s financial industry should “lead the global dialogue on new technologies such as stablecoins and central bank digital currencies”, which will consolidate the UK’s leading position in the field of financial technology.
The statement mentioned that new technologies such as stablecoins may change the way people store and trade currencies, making payments cheaper and more convenient. In order to play to the potential value of stablecoins and manage the risks of consumers and financial stability, the government will propose regulatory measures for related stablecoin programs to ensure that they meet the minimum requirements for payment methods.
The Bank for International Settlements releases stablecoin report detailing risks, opportunities and regulation
The Bank for International Settlements (BIS) released on November 24-“Stablecoins: Risks, Opportunities and Regulations”, detailing the potential role of stablecoins and their implications for regulation. The report outlines the market development of existing stablecoins and describes their potential to embed powerful currency tools in the digital environment. It believes that stablecoins are designed to challenge existing e-commerce digital payment methods, including traditional bank payments, credit cards and Electronic wallets, etc. At the same time, stablecoins, especially the Libra project led by Facebook, also pose a challenge to the global financial system. The report analyzes and discusses the Libra project and related regulatory countermeasures, and believes that the supervision of stablecoins should be based on the many conveniences it may provide, not limited to the existing regulatory framework, and consider implementing “embedded supervision”, namely Directly embed the regulatory requirements into the realization of the “global stablecoin” system.
The MYKEY stablecoin report in this issue has been shared, please stay tuned. We will provide you with more analysis of the development status, trends and international impact of stablecoins, and help readers continue to update their understanding of the development of stablecoins.
Note: MYKEY Lab has the final right to interpret the content of the article, please indicate the source of the citation. Welcome to follow the MYKEY Lab official account: MYKEY smart wallet.
Since 2020, the U.S. banking industry has begun to experience accelerated development in the provision of encrypted digital currency-related financial services.
Original title: “The Office of the Comptroller of the Currency is accelerating the encryption and digitization of the U.S. banking industry”
Written by: Gu Yanxi, founder of the American Liyan Consulting Company, a researcher and practitioner in the blockchain and encrypted digital asset industry
Before 2020, the service of encrypted digital assets in the U.S. banking industry has been slow. There are only scattered efforts in the market to provide services for the encrypted digital currency field. Companies that provide encrypted digital currency transaction services obtain money transmitter licenses from each state to legally operate in each state. There are also some companies that provide custodial services for encrypted digital currencies by obtaining trust licenses. However, the overall banking system of the United States has not begun to provide services related to encrypted digital assets. However, since 2020, the U.S. banking industry has begun to experience a comprehensive acceleration of development in providing encrypted digital currency-related financial services. And this accelerated development is the result of the top-down promotion of the US banking industry. Specifically, it is the result of the promotion of Brian Brooks, the new leader of the Office of the Comptroller of the Currency (OCC).
Before analyzing the changes in this aspect of the U.S. banking industry, first introduce the financial institutions related to encrypted digital currencies.
The structure of the U.S. banking market is a federal structure, including the U.S. national and state levels. Financial-related policies can be formulated at the national level and implemented nationwide. Financial institutions established at the national level can operate nationwide without state restrictions. Each state can formulate its own related financial policies, but the scope of business is limited to the state. In terms of financial institutions, the U.S. banking system is divided into two layers, the national bank and the state bank. National banks can operate nationwide, while state banks can only operate in their state. In addition to the banking system, financial institutions related to encrypted digital currencies also include trusts and money service agencies (Money Services Business, MSB). Trusts can only provide asset custody services, and cannot provide a full range of financial services. MSB is an institution approved by each state. The barrier to becoming an MSB is not high. In terms of supervision, the main institution that supervises U.S. banks is the OCC. The OCC supervises the federal banking system, including the National Bank, the Federal Savings Association, and the branches and institutions of foreign banks in the United States. The total number of these institutions is 1,200. These institutions hold 70% of the total assets of the US banking system.
Due to regulatory and conceptual restrictions, the U.S. banking industry has made very slow progress in providing encrypted digital asset services. In terms of supervision, the strict supervision of the US financial industry makes every financial institution cautious, lest there be violations, leading to strict penalties by financial supervision. Any business that may be suspected of violating regulations, they are shunned. Encrypted digital asset business is one such business. Encrypted digital currency is considered by many to be a tool for Ponzi schemes and speculation. More importantly, encrypted digital currency is also used as a money laundering tool. Therefore, due to the above reasons, US financial institutions are too late.
Conceptually, encrypted digital currencies are also despised by practitioners of mainstream financial institutions. For example, Buffett publicly believes that Bitcoin is the square of rat poison. He claimed that he does not hold encrypted digital currency now and will never hold it in the future. The CEO of Chase Morgan also believes that Bitcoin has no value. Some influential economists also have a very negative attitude towards encrypted digital currencies. Therefore, under the influence of financial supervision and concepts, financial institutions in the US banking industry have been reluctant to get involved in the field of encrypted digital assets.
In the past few years, encrypted digital currency trading companies usually obtained operating licenses in various states by obtaining MSB. They need to obtain such a license in each state. In addition, some encrypted digital currency trading companies carry out related businesses by obtaining trust licenses, but these companies can only provide custody services for encrypted digital assets and cannot provide users with all aspects of financial services.
In 2020, after two years of planning, the US state of Wyoming took the lead in issuing an encrypted digital bank license in its state. Its name is SPDI, Special Purpose Depository Institution. Two companies have now been approved to obtain such licenses.
These aspects are the beginnings of the state level and relatively small financial institutions. Before 2020, the U.S. banking market has not made any progress at the national level. But this situation will begin to change at an accelerated pace in 2020. The U.S. banking industry has begun to accelerate the development of encrypted digital monetization. Such a change began with the appointment of Brian Brooks as acting director of the OCC.
In March 2020, Brian Brooks was appointed as the Chief Operating Officer and First Deputy Administrator of the OCC. Two months later, he was promoted to acting director. After joining OCC, Brian Brooks began to focus on promoting the development of the U.S. banking industry to the direction of encrypted digital assets. Before joining OCC, Brian Brooks served as the Chief Legal Officer of Coinbase, a major cryptocurrency trading platform in the United States. He joined Coinbase in September 2018. Prior to this, he has been working in the legal and financial industries. During his tenure at Coinbase, he directly felt the slow development of the banking industry in the field of encrypted digital currency and the restrictions on the development of the encrypted digital currency industry.
Compared with his experience in specific business, more importantly, Brian Brooks believes from the concept that the current financial industry is undergoing fundamental changes, and such changes are the same as changes to the world by the Internet. The example he often cited is the change of the Internet to the post office. Before the advent of the Internet, communication between people needed to be completed through a centralized node such as a post office. And each communication requires a postage of 44 cents. But after the advent of the Internet, people can communicate directly with each other in time, and no longer need a centralized node such as a post office. Moreover, due to the emergence of Internet technology, more types of rich communication tools have appeared, and the communication content is much richer than text. Now the emergence of blockchain technology allows people to exchange value directly with each other without having to go through a centralized node such as a bank. The content and form of future value exchange will also be richer. The changes brought about by blockchain technology to value exchange will be the same as the changes brought about by the Internet to information exchange. Therefore, the banking industry must make corresponding changes to adapt to this new technological change. He believes that banks are institutions that have emerged in modern times. It did not exist before, and it will not necessarily continue to exist in the future. People need to continue to do financial business, but financial business does not necessarily need to be completed through banks.
Under the guidance of this philosophy, after joining OCC, Brian Brooks began to promote the transformation of the U.S. banking market in this direction. In July 2020, the OCC issued a statement letter clearly stating that the U.S. Federal System Bank can provide custody services for encrypted digital currencies, and at the same time reiterated that the National Bank can provide financial services to any legal entity including encrypted digital currency companies. In September 2020, the OCC issued a statement letter confirming that the National Bank and the Federal Reserve Association can provide users’ stablecoin products with reserve custody services. Also in 2020, OCC is establishing a nationwide payment charter to allow institutions that do not take deposits to provide payment services. Such a move will elevate the current money transfer services in each state to the national level. In this way, any company planning to provide payment services nationwide no longer needs to apply for operating licenses in every state. Such a move also affected the interests of the bank. Currently there are only payment services provided by banks, but since then they are no longer limited to banks. Any institution, including encrypted digital currency and other types of technology companies, can also provide payment services across the United States after obtaining this license. In Brian Brooks’ view, although banks currently provide three basic services: deposit absorption, lending and payment, this arrangement is not always the same. When there is demand in the market, some of these services can be undertaken by other types of institutions. At present, he obviously thinks that payment services can be handed over to other types of institutions.
The characteristics of blockchain technology make it very suitable for developing financial business on top of it. In fact, it will become the infrastructure of the digital financial world in the future. At present, the business in the banking industry and the securities industry will be carried out on the same financial market infrastructure (Financial Market Infrastructure, FMI) (see my related article). So far, various efforts in the market have been moving in this direction. But most of these efforts are initiated and promoted by market forces, and few financial regulatory agencies are pushing from the top down. The OCC under the leadership of Brian Brooks is one of the few cases in this regard. Given the size of the U.S. banking system, the promotion of such financial regulators in this regard is even more distinctive. According to the current way of advancement, the process of encryption and digitization of the US banking industry will accelerate.
In accordance with the current development trend, the traditional banking industry has begun to provide encrypted digital currency related services, and encrypted digital currency companies have begun to provide services that previously belonged to banks. The two tend to merge. For any of them, if it is still based on the traditional centralized technology system to carry out business, it is of little significance. For example, banks began to provide custody services to encrypted digital currency companies. Such a business can help banks increase their income, but it will not produce a qualitative change. Only when financial services are carried out on the basis of the support of distributed accounting technology, will this bring substantial changes to the financial industry. Take the payment business as an example. If a financial technology company starts to provide stablecoin-based payment services based on blockchain technology, this will bring a paradigm change to the US financial industry. The infrastructure for providing payment services is parallel to the bank’s existing payment system, and because it is based on distributed accounting technology, it is superior to the existing bank payment system in terms of efficiency and cost. More importantly, such an infrastructure not only supports the circulation of digital currency, it can also support the generation, registration, circulation, transaction and settlement of digital financial products, and it adopts digital currency to use DVP for transaction settlement. This will form a digital financial market parallel to the existing banking and securities industries. This will not only compete with existing institutions in banks, but also with institutions in the securities industry.
Now, under the leadership of Brian Brooks, OCC is advancing the development of this process. First, mainstream banks can start to provide financial services related to encrypted digital currencies. Second, OCC is formulating policies to allow financial technology companies to provide payment services across the United States. After such a process begins, distributed accounting technology will be introduced as a market infrastructure, and more encrypted digital financial services will be developed on this market infrastructure. Of course, such a development process will be full of obstacles. Now there are financial industry associations writing letters urging OCC to act cautiously. The US presidential election may also lead to changes in the personnel of various departments of the US government. Therefore, there are still very big variables in the development of the US banking industry in the direction of encryption and digitalization. But its subsequent development is very worthy of attention.
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