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FinTech Giants PayPal, Intuit and Square Capital Approved to Digitally Distribute US Govt COVID-19 Small Business Stimulus

PayPal, Square and Intuit have received the US Government’s approval to take part in the Small Business Administration’s (SBA) Paycheck Protection Program(PPP) which was established in response to the COVID-19 pandemic triggered global financial crisis.

The approval was granted following an appeal to Congress by Financial Innovation Now (FIN), on March 19, for FinTech companies to help distribute the loans digitally, citing concerns that many small businesses would run out of working capital before they received any of the $350 billion stimulus package.

FIN is a FinTech alliance which includes Square, PayPal, Intuit and Stripe. In the letter addressed to lawmakers they argued that they had “the reach, relationships, and digital capabilities to reach those businesses most vulnerable” in a more timely fashion while the traditional US insititutions were left wanting in this regard.

PayPal First Non-Bank Participant

Paypal was the first of the non-bank institutions to announce they had received official approval to help distribute the funds under the SBA program, which is part of a larger US Congress approved economic stimulus relief package totalling $2 Trillion USD.

The global payments giant has been offering small businesses loans and cash advances since 2013.

In a Linkedin post on April 11, Dan Schulman, President and CEO of PayPal said, “We are eager to deploy our capital and expertise to do our part in helping small businesses survive this challenging period.”

Shulman also revealed that the first loans have been applied for and issued. He said,“ We expect more loans to be issued in the coming days. Thanks to Congressional leaders and the Administration for ensuring the CARES Act allowed companies like PayPal to help distribute funds quickly to those businesses that are most impacted.”

Square Capital Joins In

Jack Dorsey’s newly founded Square Capital also announced it had received SBA approval as a PPP lender in partnership with Celtic Bank.

Jackie Reses, Capital Lead and People Lead at Square took to Twitter yesterday to announce, “Square Capital has received U.S. Treasury and SBA approval to be a PPP lender, and we will start rolling out our PPP loan applications this week. We continue to work with our partner Celtic Bank as they have existing expertise as a leading SBA lender.”

The announcement also stated that sellers would be notified through the Square Dashboard when their applications are available.

Intuit Demystifys Stimulus Programs and PPP

Joining PayPal and Square Capital, Intuit has also received approval as a non-bank lender for the SBA’s PPP via its QuickBooks Capital.

Intuit appears to be taking things a step further in demystifying the whole process for American citizens. Their software simplifies the application process and offers guidance on which relief funds the small business owner’s are eligible to claim. Intuit automates the application in coordination with the SBA to distribute the PPP funds quickly.

On Monday, Intuit also announced the details of several of its new programs launched in response to the COVID-19 global financial crisis and the resulting US federal government aid programs. The FinTech company set up Intuit Aid Assist as a free website designed to help small business owners and those who are self-employed assess how much federal relief they’re eligible for under the Coronavirus Aid, Relief, and Economic Security (CARES) Act.

Image via Shutterstock

Afghans Seeking Refuge in Cryptocurrencies as Taliban’s Takeover Causes Economic Turmoil

Some Afghans are relying on holding cryptocurrencies amid the economic turmoil triggered by the Taliban’s hostile takeover.

CNBC media outlets recently had conversations with some Afghan crypto users who revealed an inciting trend taking shape within the country. Farhan Hotak, a 22-year old Afghan, spoke to CNBC, said that he has been holding his cryptocurrency on the Binance exchange.

Musa Ramin, 27, another Afghan national, also disclosed to CNBC that he had invested a portion of his net worth into cryptocurrencies days before the Taliban entered Kabul. Ramin stated that he first invested in cryptocurrencies after massive losses after the afghani currency plunged its value due to the Covid-induced global economic downturn. “That is when I discovered bitcoin,” he said.

Hotake and Ramin are among few Afghans protecting their savings from the currency onslaught triggered by the Taliban’s regime takeover. They have invested in cryptocurrencies to safeguard them from rapid currency deprecation. Afghanistan’s currency has plummeted drastically after the Taliban took control of the nation.

The Taliban recently overthrew the Afghanistan government and caused a crisis that has left many people facing financial ruin because of bank closures, cash shortages, and the suspension of international money transfers like major remittance providers such as MoneyGram and Western Union.

The US has also frozen around $9 billion in central bank reserves. The devaluation of the afghani currency has seen the prices of basic goods and services increase in Afghanistan. Economic experts have warned that Afghani citizens could suffer more due to hyperinflation risks facing the country.

The decentralised nature of crypto assets such as Bitcoin makes it an attractive option for Afghan citizens who want to store their savings or move funds abroad. The fixed supply of Bitcoin makes it intrinsically anti-inflationary.

Some crypto users in Afghanistan have even called for introducing a “Bitcoin standard” to ensure Afghanistan’s sovereignty.

Janey Gak, who identifies herself in social media as “Bibi Janey online, created a Facebook page in 2018 to assist in encouraging Bitcoin adoption and spreading awareness.

After the Taliban took over the Afghan government recently, Gak tweeted: “In order to be a truly sovereign state, the Islamic Emirate of Afghanistan must: not join the UN nor allow their agencies to operate in the country; never borrow money; adopt a bitcoin standard.”

Taliban Causes Chaos

Cryptocurrency investment is a relatively new concept in Afghanistan, but the nation has witnessed rapid adoption of virtual assets in 2021.

On August 18, the Chainalysis blockchain data platform released the 2021 Global Adoption Index that ranks Afghanistan 20th position out of 154 countries ranked in the index. That is a huge improvement for Afghanistan as the country did not appear on the list in 2020. The index further ranks Afghanistan 7th position based on its increased peer-to-peer (P2P) exchange trade volumes.

Data from Google trends indicates that searches for terms like “Bitcoin” and “crypto” have increased sharply in July, just weeks before the Taliban coup in Kabul. Google data shows that more Afghans began investing in crypto assets this year, probably due to fear of an economic crisis as the Taliban started its pursuit of taking control over the nation.

On August 15, Taliban fighters took control of the Afghan presidential palace after Afghanistan President Ashraf Ghani fled the country. The Taliban seized power in Afghanistan two weeks before the US planned to complete withdrawal of its troops after a costly two-decade war.

The insurgents stormed across Afghanistan, capturing all major cities within a few days, as Afghan security forces equipped and trained by the US and its allies left the country.

The Taliban, a militant group that ran the nation in the late 1900s, retook control of the country.

Afghan citizens are fleeing the country because they are worried that the nation could plunge into chaos or the Taliban could carry out revenge attacks against those who worked with the Americans or the government.

SushiSwap CEO Proposes New Token Model

SushiSwap CEO Jared Grey has initiated a pivotal proposal titled “Deploy new tokenomics for Sushi.” This initiative, which seeks to overhaul the platform’s existing token economic model, has now entered the crucial stage of community voting on Snapshot. The voting process, critical for determining the future course of SushiSwap, began recently and is set to conclude on November 25, 2023, at 1:00.

The core of the proposal is to generate a consensus within the community. Its details and the initial draft can be found on the Sushi forum, providing comprehensive insights into the proposed changes. Grey’s initiative emphasizes the need to restructure Sushi’s token model to enhance its role in the protocol’s ongoing success and contribute to its growth trajectory. Since its inception, SushiSwap has been a front-runner in tokenomics with innovative initiatives like MasterChef and xSushi. The new proposal is a culmination of feedback from both the Sushi and DeFi communities, aiming to set the platform on a sustainable growth path.

The proposed model is built on three fundamental pillars: protocol sustainability, token utility enhancement, and treasury diversification. It addresses several key challenges, including improving rewards efficiency to reduce the annual cost of Sushi emissions, establishing a balanced approach to emissions distribution, addressing financial stability concerns, recalibrating LP incentives, and revising xSushi staking mechanisms.

Furthermore, the economic model proposed scales strategically through various innovations. These include generating primary revenue from LP transactions through trading fees, income from trade fees via aggregation, potential revenue from staking rewards, and forming strategic partnerships. The model also considers the interests of key stakeholders such as Liquidity Providers, xSushi holders, traders, token projects, DAOs, and the Sushi Treasury.

The objectives of the revised proposal are manifold. They include promoting decentralized ownership, amplifying liquidity, encouraging sustainable growth, enhancing the protocol’s sustainability, bolstering $SUSHI utility, and diversifying the treasury for robust financial operations. This new model aims to enhance liquidity, offer non-dilutive token rewards, institute a balanced supply, and ensure competitiveness in the evolving DeFi landscape.

The ongoing voting process is a decisive step for SushiSwap. A positive outcome will lead to the enactment of the proposed framework, reshaping Sushi’s token model to align with its ecosystem goals, increase decentralized ownership via the DAO, realign stakeholders optimally, and promote ecosystem growth with sustainable emissions and value.