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Allianz Advances with Blockchain-Based Token System

As the growing adoption of blockchain technology approaches the mainstream enterprises, the insurance giant, Allianz has also entered the blockchain sector. Allianz Global Corporate & Specialty SE (AGCS) has progressively been developing a token-based ecosystem utilizing blockchain technology.

Currently, the token is still in the experimental phase, although the basic core infrastructure has already been constructed, tested, and examined.

A spokesperson mentioned to Forbes:

AGCS is further exploring blockchain technology to simplify and accelerate cross-border insurance payments for its corporate customers. A project team is in the advanced stages of development for a token-based electronic payment system to allow for frictionless, transparent, and instantaneous money transfers for a range of different types [of] payments.

About the Token

The “internal token” developed by Allianz aims to tackle issues of the inefficiencies of the worldwide money transfer for its global affiliates. It will be run on a proprietary blockchain built by the company, Adjoint.

Oliver Volk, the blockchain expert at Allianz, told Coindesk, the token would be “very helpful to get rid of FX constraints and other stuff we have to optimize, especially if you talk to certain currencies which we do not accept at our headquarters and have to be reconverted.”

Global Enterprises and Blockchain Adoption

Recently reported, the US insurance giant, State Farm, and the United Services Automobile Association were testing a blockchain-based solution to streamline the insurance claims process.

Other large mainstream players have also been experimenting with blockchain in 2019. JP Morgan Chase announced its JPM Coin, Facebook introduced Libra, and Walmart has been taking a step towards developing its own digital currency as well.

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Brazil Central Bank Moves to Follow IMF Crypto Classification Guidelines

The Central Bank of Brazil has adopted the classification of cryptocurrencies being sold or purchased under the International Monetary Fund (IMF) guidelines.

According to the announcement from the Brazil Central Bank, IMF guidelines will now be followed. Cryptocurrencies will be classified as non-financial products and will be classified as goods on its balance sheet.

The external sector statistics methodology to the IMF Statistics Department recommended that Bitcoin and other cryptocurrencies should be classified as produced non-financial assets and should be put under valuables.

The report states, “These assets come into existence as outputs of a production process (i.e., through mining and/or project development) under the control, responsibility, and management of a specific institutional unit using inputs of labor, capital, goods, and services.”

Given that selling and purchasing cryptocurrencies involves the execution of foreign exchange contracts, the central bank considers crypto assets in their export and import statistics. Brazil being a net importer of crypto assets, will contribute to lowering the trade surplus on its balance sheet.

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HSBC Becomes the First Bank to Finance Transaction via Hyperledger

Multinational banking giant, HSBC has reportedly become the first bank to complete a financial transaction using the blockchain trade platform, we.trade based in Europe.

Based in Dublin and established in 2017, we.trade is a blockchain trade platform that runs on the IBM Hyperledger Fabric. The platform allows clients to manage, track, and securely open account trade transactions between SMEs in Europe.

The Global Trade Review recently reported that HSBC financed a transaction on the we.trade platform within the second round of pilots that started in June of 2019. The transaction took place between HSBC’s client Beeswift, which was a company that produces protective equipment and their sale to a company in the Netherlands banked by Rabobank.

It was also stated that we.trade has been supported and backed by 12 major shareholders, including banking giants such as Deutsche Bank, Natixis, Rabobank, Santander, and HSBC.

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Deutsche Bank Joins JP Morgan’s Blockchain Platform

This article is contributed by our content partner, Nexchange Group.

Germany’s beleaguered banking giant, Deutsche Bank, has joined JP Morgan’s blockchain-based Interbank Information Network (IIN), the Coin Telegraph reports.

Deutsche Bank’s entry brings the initiative’s network to 320 banks, with Takis Georgakopoulos, head of payments at JP Morgan, expressing hope that Deutsche will be the first of several other large banks to join the platform.

Deutsche Bank, the world’s largest clearer of euro-denominated payments, expects IIN to slash the cost of processing difficult payments, said the bank’s Head of Cash Management, Ole Matthiessen. IIN, Matthiessen added, should also help Deutsche raise the quality of its client services.

JP Morgan launched IIN back in 2017 with two partners, the Royal Bank of Canada and Australia and New Zealand Banking Group. The aim was – and is – to use blockchain to reduce friction in the global payments process, allowing payments to reach beneficiaries faster and with better security. Large banks such as Société Générale, Sumitomo Mitsui, and China CITIC Bank have joined since then, and according to Georgakopoulos, JPMorgan is expecting to announce agreements with other large banks in the future.

The firm, he says, aims to reach 400 agreements with banks by the end of the year.

World First Crypto Bank Sygnum Receives Approval To Offer Banking Services In Singapore

In a report posted by the Sygnum official blog site on Oct. 31, it has been stated that the company has been granted approval by the Monetary Authority of Singapore (MAS) to operate digital markets services in the country which complemented their recent obtainment of banking and securities dealer license in Switzerland from the Swiss Financial Market Supervisory Authority (FINMA).

With this dual location – Singapore and Switzerland, Sygnum, as the world’s first crypto bank, empowers institutional and private certified investors, banks, corporates, and other financial bodies to invest in the crypto economy with unalloyed trust alongside their scalable, independently controlled, and future-proof regulated banking solution.

“Our dual location – in Singapore and Switzerland – is one of the cornerstones of our strategy. This is reflected across the team, advisory council, the board of directors as well as investor base. All have been instrumental in our achievements so far across both countries,” said Sygnum Co-Founder and CEO Singapore Mathias Imbach.

As stated in the report, Sygnum’s obtainment of the capital market license will give the company the ability to conduct asset management activities, focusing on crypto investment strategies for institutional and private certified investors. In this regards, Stefan Mueller, Head of Asset Management at Sygnum, said:

“The CMS license is an important milestone for establishing our asset management arm, leveraging the vibrant financial environment in Singapore. This is complementary to our banking services in Switzerland and will also benefit our Swiss institutional and private qualified investor clients.”

Sygnum’s first product will soon be accessible in Switzerland. The product as a multi-manager fund apportions investments across a group of managers that utilize the global digital asset opportunity using varied investment procedures.

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Elliptic Discovery Established to Seamlessly Assist Banks in Crypto-Asset Decisions

Elliptic, a London-based provider of crypto-asset risk management solutions, has launched of Elliptic Discovery, a database of more than 200 worldwide crypto exchanges, that is purposely built for banks in their quest to determine the flow of funds into and out of crypto-assets.

Elliptic Discovery seeks to offer banks insights about opportunities and risks presented by crypto exchanges as it comprises of a wide range of identifiers and risk indicators.

Some of the information to be availed pertaining to crypto exchanges include compliance policies, regulatory status, corporate entities, and jurisdiction. Additionally, blockchain insights about the crypto assets they have handled will be provided.

Banks to easily comprehend the crypto ecosystem

By utilizing Elliptic Discovery, banks will be in a position to comprehend their overall exposure to crypto-assets based on their clients’ activities. Moreover, they will be able to spot customers whose crypto assets are endangered by sanction risks or money laundering.

James Smith, Elliptic’s CEO and co-founder, noted: “For too long, banks’ lack of visibility into the crypto-asset ecosystem has led to zero-tolerance for this emerging asset class. This has frustrated their customers, while they have remained blind to the actual risks posed by their exposure to crypto-assets. Elliptic Discovery changes that by enabling banks to shine a light on their customers’ crypto-asset activity and take a risk-based approach.”

He added: “Not all crypto-asset exchanges are alike and Elliptic Discovery will allow banks to make this distinction and seize the opportunity to work more closely with these businesses, based on an evidence-based assessment of the risk.”

Elliptic Discovery, therefore, seeks to propel transparency between traditional financial institutions, such as banks, and crypto exchanges so that a win-win situation can be established.

Elliptic partnered with Zilliqa, a Singapore-based blockchain network provider as reported on Nov. 28, to facilitate the infrastructure compliance and security of the latter’s network by offering an anti-money laundering (AML) compliance support.

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UK’s First Regulated Crypto Bank to be Launched by Former Barclays Tech Head

The former Head of Technology for the Barclays group, and former CTO at Starling Bank in the UK, Mark Hipperson is planning to launch a regulated crypto bank with his digital banking venture Ziglu.

Foreign currencies will be made available for exchange at interbank rates, and cryptocurrencies sell and buy prices will also be at the best price across various exchanges.

By using a Mastercard debit card, any currency held in the account can be spent anywhere in the world, including cryptocurrencies, which are converted at the time of sale.

Ziglu has applied to the UK’s Financial Conduct Authority (FCA) to become a regulated issuer of electronic money. Currently, only UK residents who are over the age of 18 are permitted to use Ziglu’s services and are eligible to apply for an account.

FCA’s policy statement on digital assets

The FCA first issued a finalized policy statement on digital assets in August 2019, titled “PS19/22: Guidance on Cryptoassets”. This policy statement update is in response to the feedback received from the previous policy statement issued in January. The objective of the final guidance is to bring more clarity on the regulation for the existing types of digital assets.

Bitcoin and Ether, which are considered major cryptocurrencies, are classified as “exchange tokens.” These exchange tokens are not backed by any central authority and are usually decentralized and primarily used as a means of exchange. The FCA has stated that they will not be regulating exchange tokens. However, Anti-Money Laundering regulations still apply.

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First Crypto-Native Bank to be Launched in the United States by Former Wall Street Executive

Former Wall Street executive and blockchain laws advocate Caitlin Long has seized the opportunity to establishthe first crypto-native bank in the United States. This opportunity came as an advantage as the Wyoming legislature has been progressive, and Long previously helped Wyoming to enact thirteen blockchain-enabling laws.

Long made the observation that a critical piece of the US market infrastructure is missing, therefore a regulated bank “acting as a bridge to the Federal Reserve for payments and custody for BIG institutional money.”

With the help of Wyoming governor Mark Gordon, the bank, Avanti can utilize the special-purpose depository institution law, providing the optimal regulatory-compliant structure in the United States for providing crypto-involved financial firms.

Adam Back, the CEO and Founder of Blockstream has also been in conversations with Long, as she believes Blockstream is an “ideal partner for serving BIG institutional investors that require regulated banks to deliver them services around Bitcoin in USD markets.”

Long aims to be protocol neutral, to welcome all cryptocurrencies demanded by clients. Long believes this will attract the “best from the crypto and traditional worlds.”

UK’s first regulated crypto bank to be launched

The former Head of Technology for the Barclays group, and former CTO at Starling Bank in the UK, Mark Hipperson, as Blockchain.Newspreviously reported, is planning to launch a regulated crypto bank with his digital banking venture Ziglu.

Foreign currencies will be made available for exchange at interbank rates, and cryptocurrencies sell and buy prices will also be at the best price across various exchanges.

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South Korea’s Largest Bank Reveals Crypto Custody Service Filing and Potentially Even More Crypto Services to Come

The largest bank in South Korea, KB Kookmin Bank has revealed its filing of a trademark application for KB Digital Asset Custody (KBDAC), its crypto custody service.

The crypto custody service will be made available for assets including Bitcoin (BTC) and Ether (ETH). The trademark application was filed with the Korean Intellectual Property Office, as reported by a local news outlet.

The application stated that the bank could potentially launch the service shortly, and also means that the entity has already begun the branding of products and the development has almost been finalized.

KB announced its partnership with Atomrigs Lab in June 2019, to develop a crypto custody service leveraging a product that secures crypto utilizing multi-party computation (MPC) technology which Atomrigs Lab specializes in. MPC technology generates random key parts rather than a single private key. These key parts can be stored separately to protect the assets from the vulnerability of being stolen.

According to the report, KB could potentially add to its suite of services involving digital assets, including trading, investment advisory, and asset management.

Less than a month ago, South Korea’s National Assembly followed suit and has amended the Act on Reporting and Use of Specific Financial Information, fully legalizing cryptocurrencies in the nation.

Following the passage of the amendment by the South Korean Parliament, cryptocurrency holding and trading have finally found their place in the nation’s legal system. It is speculated that this turn of events will usher in a restructuring of the country’s blockchain sector.

After President Jae-in Moon signs the passed amendment, the enactment process will kickstart and is expected to take full effect one year from the date of signing, with a six month grace period to follow for a market adjustment.

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Bank of Japan Sets Up New Research Team For Digital Yen CBDC Development

Japan’s central bank announced that it has set up a new research team to dive deeper into Central Bank Digital Currency (CBDC) experimentation and development. The Bank of Japan (BOJ) is possibly preparing for a CBDC, given the recent rising demand for classless payments and growing interest among other central banks.

The New Team to Explore the Use of CBDCs

The new team would follow up on the Bank of Japan’s efforts on CBDCs, as well as on joint research that the central bank has been carrying out with other major central banks since January. In other words, the new team is set to take over from a previous working (research) group, which was created in January this year to look into the feasibility of a national CBDC. Furthermore, the team would continue doing research work undertaken with other leading central banks.

The team would belong to the central bank’s payment and settlement systems department.

Since the beginning of this year, Japan’s central bank has been formally researching CBDCs when it partnered with five major central banks, including the Swiss National Bank, the European Central Bank, the Bank of England, the Sveriges Riksbank (Sweden), and the Bank of Canada. The formation of the new team indicates that the Bank of Japan is determined towards CBDCs.

A New Deal for Japan

The news comes just a few days when Japan’s government said it is contemplating issuing a national digital currency by including the plan in its policy framework. The move to include such a plan in the country’s policy framework would make the issuance of a CBDC as part of this year’s government policy.

Although the Bank of Japan has previously stated it has no immediate plans to issue a digital yen, the recent breaking news indicates urgency. Japan’s central bank is shifting towards embracing technology as China appears to be moving quickly to launch its own CBDC. Japan’s lawmaker, Norihiro Nakayama, once stated that Japan would require support from the US to curb the influence of China’s digital currency.