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Walmart wants to patent a stablecoin that looks a lot like Facebook Libra

(Article published by Daniel Palmer with same title in CoinDesk)

Retail giant Walmart has applied for a cryptocurrency patent that bears some similarities to the Libra token proposed by Facebook in mid-June.

In its application with the U.S. Patent and Trademark Office, Walmart touts the concept of a digital currency “tied to a regular currency” – that is, what’s commonly known as a stablecoin. Libra will be a token pegged to a basket of fiat currencies and government bonds, according to Facebook.

Over and above that, the filing suggests that the proposed coin could help provide finance for those with limited access to banking services – one of the major claims Facebook has made for Libra, most likely in an effort to appeal to the public (and regulators) over the token. “Using a digital currency, low-income households that find banking expensive, may have an alternative way to handle wealth at an institution that can supply the majority of their day-to-day financial and product needs,” Walmart states.

Facebook’s offering is expected to create a system whereby its social media platforms could use Libra for payments, allowing advertisers to earn Libra and pay Facebook in the token for ads. Although it could also be used more widely in time in remittances and other use cases.

Walmart’s filing, too, indicates its coin could have features that apply to a token being used within the ecosystem of a high-street retail company: “The digital currency may be pegged to the US dollar and available for use only at selected retailors or partners. In other embodiments, the digital currency is available for use anywhere. The digital currency can provide a fee-free, or fee-minimal place to store wealth that can be spent, for example, at retailers and, if needed, easily converted to cash.”

A notable difference is that users of a “Walmart Coin” could “even earn interest,” the application suggests. With Libra, interest earned on the scheme’s potentially vast reserve funds would go to Libra partners that back the company to the tune of around $10 million.

More closely applying to a commerce giant, though, Walmart says its token could store user’s purchasing histories on the blockchain, and then apply related savings to their subsequent purchases in a similar way to loyalty points.

Other novel features suggested in the very broad filing include the ability to remove the need for credit cards, and acting as a “pre-approved biometric (e.g., fingerprint or eye pattern) credit.” “A person is the ‘credit card’ to their own digital value bank,” the firm says.

The token could also be used to restrict what product categories can be bought and by whom, for example blocking minors from purchasing cigarettes, alcohol, or an R-rated DVD.

Walmart is already using blockchain for tracking products like fresh greens and pharmaceuticals. It’s also has been investigating various use cases of the technology, with projects including connecting automated delivery drones. In June, Walmart China launched a live scheme aimed to improve the nation’s poor food safety record. It also has a host of other patents applied for, including some relating to tracking packages, power supply payments and delivery fleets.

Facebook Libra backers are not official partners yet, says Visa CEO

(Article published by Daniel Palmer with same title in CoinDesk)

While Facebook’s Libra project was said to already have 28 founding partners when unveiled in June, that isn’t quite the case, according to Visa’s CEO and board chairman, Alfred F. Kelly, Jr.

In a Q3 2019 earnings call on 23 July, Kelly responded to a question on his firm’s involvement with the Libra project from Bryan C. Keane, an analyst at Deutsche Bank Securities. Keane asked, “Just wanted to ask on Facebook’s Libra, there’s some confusion in the market on how to think about that. Is it a strategic partner for Visa or potential disruptive threat? Just curious your thoughts and level of expected Visa involvement in Facebook Libra.”

Playing down the firm’s involvement with Libra, Kelly responded that “it’s important to understand the facts.” He continued: “So we have signed a nonbinding letter of intent to join Libra. We’re one of – I think it’s 27 companies that have expressed that interest. So, no one has yet officially joined.”

The Libra Association’s group of 28 launch partners includes Visa, Mastercard, PayPal, Uber, Lyft, Coinbase and others.

“Implied in this project is that wherever the Visa or Mastercard logo are accepted, Libra would follow suit,” Dante Disparte, head of policy and communications for the Libra Association, told CoinDesk at the time. “In so many ways it’s a great leap forward for cryptocurrencies and, in many respects, a mainstreaming of this asset class.”

Going forward, the decision to fully join Facebook’s cryptocurrency project would be decided by a “number of factors, including obviously the ability of the association to satisfy all the requisite regulatory requirements,” Kelly said.

As suggested, since its release of a Libra white paper in mid-June, Facebook has been defending itself from a storm of calls from regulators worldwide for more information on how the scheme would work, amid concerns over what affect it could have on financial stability and users’ privacy.

Kelly emphasized in the call that “it’s really, really early days” and much has still to be finalized regarding Libra. He finished on a positive note for Facebook, however, saying: “But obviously, given that we’ve expressed interest, we actually believe we could be additive and helpful in the association.”

The CEO’s comments come as confirmation of a New York Times piece from late June that cited unnamed sources at seven of the firms as saying that they had signed nonbinding agreements with Facebook.

US may bar large tech firms from issuing cryptocurrencies

(Article published by Wolfie Zhao with same title in CoinDesk)

Lawmakers in the U.S. are discussing a bill that seeks to prevent large technology institutions in the country from issuing cryptocurrencies.

According to a report from Reuters on 15 July and a copy of the draft bill circulating online, policymakers in the U.S. House of Representatives are looking to step up their scrutiny over big tech firms that are interested in cryptocurrencies. Under the section of “Prohibition related to cryptocurrencies,” the draft bill, called “Keep Big Tech Out Of Finance Act,” states: “A large platform utility may not establish, maintain, or operate a digital asset that is intended to be widely used as medium of exchange, unit of account, store of value, or any other similar function, as defined by the Board of Governors of the Federal Reserve System.”

The bill specifically defines a digital asset as “an asset that is issued and transferred using distributed ledger or blockchain technology, including, so-called ‘virtual currencies,’ ‘coins,’ and ‘tokens.’” It further clarifies any large tech firm with over $25 billion in global annual revenue could fall into this category and any violation of the proposed regulation should be subject to a fine of “not more than $1 million per each day of such violation.”

While the bill is still in a discussion draft form and not yet formally submitted, the news comes just weeks after Facebook announced a plan to issue the Libra cryptocurrency on a blockchain. The firm booked $55 billion in revenue for 2018. Worldwide regulators have since then voiced concerns on how Facebook’s plan can remain compliant with financial regulations across the globe.

Last week, the U.S. president Donald Trump made his first comments on cryptocurrencies via a series of tweets, in which he criticized Facebook’s Libra project had “little standing or dependability.”

Samsung teams with banks, telcos for mobile ID network based on blockchain

(Article published by Daniel Palmer with same title in CoinDesk)

Tech giant Samsung Electronics is joining six other major South Korean firms to develop a blockchain-based certificate and ID authentication network. Announced on 14 July and reported by CoinDesk Korea, the other founding firms include mobile carriers SK Telecom, LG Yuplus and KT, two banks – KEB Han and Wooriand – and government-founded securities infrastructure provider Koscom.

The service will provide a “self-sovereign” authentication solution that does away with middlemen services and allows users to verify their identity or qualifications over a blockchain, keeping more control of their own personal information. Individuals can store their data on a smart device and submit only the data they choose when certification is required.

Tech-wise, the deal will see the firms develop the service based around a consortium blockchain model, with participating companies operating network nodes using their own servers.

The system will see a beta test by the end of 2019 and a decision on whether to commercialize the offering will be made in the next year, the report says.

Initially, the service will be applied to the issuance and distribution of graduation and other certificates from major universities in Korea, as well as to Koscom’s platform for unlisted startup stocks. A plan is being considered for the three telcos to use the system for their career recruitment process.

Mobile ID certification is expected to simplify the issuance and submission of various certificates and help companies ensure the digital have not been falsified – all in real time.

Ultimately, the firms indicated they may expand the service to other areas by encouraging more companies to participate, with potential use cases across digital signatures, user authentication for telecom and banking, healthcare and insurance certification, and club memberships. Notarization, proof of content and online logins were also listed as potential areas that could be addressed by the network.

At a signing of a joint venture agreement in Seoul on July 12, one of the participants said (via informal translation): “The participating companies plan to establish a strategy so that the mobile electronic certification can be used in various industrial fields, and plan the operation so that it becomes a service that creates social value in the long term.”

Arizona State University to use SalesForce blockchain for academic records

(Article published by Marie Huillet with same title in CoinTelegraph)

 

Arizona State University is working with local community colleges on using blockchain to innovate data sharing for academic records. The development was reported by university news site Inside Higher Ed on July 9.

Arizona State aims to use blockchain to establish whether students who transfer from community colleges have already earned enough credits to be awarded an associate’s degree — an intermediary qualification between a high school diploma and a full-fledged bachelor’s. Tracking credits during this process — known as a reverse transfer — becomes complex and time-consuming to navigate: in addition to mere data exchange, colleges are required to interpret academic records that are not homogenous and establish whether the credentials are equivalent to their own.

In partnership with cloud software firm Salesforce and its central enterprise unit EdPlus, Arizona State is thus developing a blockchain-based student data network that would allow participating institutions to securely exchange and verify academic credentials. A key focus is reportedly to make the process of data exchange bi-directional — so that community colleges can continue to be updated on their former students’ progress at Arizona State. EdPlus CTO Donna Kidwell told reporters: “We want to optimize those pathways back and forth between us […] so that we can support students who are creating their own path towards a degree.” Kidwell reportedly added that such individualized — “DIY” — student choices may also feed back into universities’ understanding of how to develop and tailor their program opportunities. Kidwell said that the system aims to better evaluate and share data so as to avoid students missing out on full accreditation for their learning: “saying you have 86 credit hours towards a degree isn’t very meaningful on a résumé.”

Many of those involved believe that students awarded an associate’s degree are more likely to proceed to complete their bachelor’s after transfer, and that blockchain can provide a robust mechanism to manage complex individual routes through higher education. As one community college coordinator remarked: “Blockchain is going to be the future of academic records.The technology would certainly provide for greater fluidity. It will also allow students to own their own academic records.”

Nonetheless, another consultant emphasized that interoperability across institutions remains a significant hurdle for optimal blockchain adoption, noting that Arizona State would: “[…] have to do the very difficult political work to get others to buy into a shared chain. They’ll face questions about sustainability, management and ownership of the information and technology, as well as the challenge of mapping knowledge from different courses at different institutions.”

Meanwhile, many top-ranked universities globally are offering a host of blockchain and crypto-related courses and accelerators: a group of Oxford professors have even been seeking full-degree granting powers in the EU for what they dub the world’s first “blockchain university.”

Facebook’s Libra coin is both ‘vampire project’ and regulatory nightmare

(Article published by Kenneth Rapoza with same title in Forbes and Medium)

Facebook says it will work with regulators in order to get Libra off the ground. Everyone has their doubts about this launch.

Mark Zuckerberg and friends are going to save the world. They are going to bring a form of capital to the unbanked, most of them residing in emerging and frontier markets. Economies of scale, and all. It’s going to be great. But imagine this: A foreign company, arguable one of the most distrusted names in social media, comes to India and tells its microlenders that it wants to compete against them. It has this cryptocurrency called Libra. It doesn’t charge banking fees. What are the odds of nationalist Indian Prime Minister Narendra Modi saying, Sure guys, come in on! This is not only regulatory nightmare in the U.S., it’s not even something microlenders in India are going to want to welcome into their country.

 

“Indian regulators already have United Payments Interface and 24/7/365 real-time free payments across India,” says Shamir Karkal, CEO at Sila and a pioneer of Simple Bank, a digital bank founded in 2009 and later acquired by BBVA for $117 million in 2014. Karkal says IndiaStack, a set of linked application programs across government and the private sector for cashless service delivery is ahead of the game anyway and is “so much better than Libra that its hard to imagine regulators allowing it into the country.” “It’s like telling the Germans that you want to launch a coal-powered car business in their country,” says Karkal, a graduate of Bangalore University and the Tepper Business School at Carnegie Mellon. “First they’d laugh, then they would ban you. Indian regulators will most likely do the same with Libra.”

Libra isn’t a done deal yet. Facebook only released the white paper this week. The cryptocurrency world has jumped all over it. The takeway is twofold. Crypto is legit, and other big names like Amazon will use this as a petri dish for their own cryptocurrency someday.

The second takeaway is: Oh, God, not Facebook.

Libra will not be launched in the U.S. initially. It will target smaller markets, where it can woo those dependent on microcredit. In Facebook’s home, the IRS and Treasury and other regulators are sure to frown about this. The IRS is probably not going to like Libra. Facebook said it will work with a country’s financial regulators in order to make sure their new cryptocurrency passes muster with the authorities. Photo: Joshua Doubek/Wikimedia Commons/CC BY-SA 3.0

“The U.S government isn’t sitting back and just watching,” says Clement Thibault, a senior analyst at Investing.com, a news and information website. The House Financial Services Committee has already requested that Facebook put a moratorium on Libra’s development until Congress and regulators have the opportunity to examine these issues and take action. “Big Tech is now one step closer to shifting the balance of power away from government agencies,” says Thibault.

That means issuing a currency, based on a basket of other currencies and assets, without a monetary authority. Libra would be a stable coin, unlike Bitcoin, which has massive volatility.

“Monetary policy would be totally out the window,” says Naeem Aslam, chief market strategist for ThinkMarkets in London. “It’s a major challenge. The U.S. would regulate Libra big time, and this comes at a time when Facebook is already being scrutinized by regulators in Europe and in the U.S.” Facebook said it will shape the project to abide by government rules. Libra isn’t meant to defy government regulators since the value of the cryptocurrency hinges on the value of sovereign currencies it is backed by.

Libra will initially be controlled by some of the world’s largest companies, who will profit directly from the use of this currency. It will likely be integrated into existing financial structures via VISA, Mastercard and PayPal.

Cryptocurrency aficionados frown upon the Libra as much as regulators and the American congress. This setup Facebook outlined in its white paper is exactly what cryptocurrencies were created to avoid. “The end goal of any monopoly is to become ‘Too Big To Fail.’ Libra is how Facebook plans to become the latest vampire corporation in modern capitalism,” says Kadena’s CEO, Will Martino. Prior to founding the New Haven, Connecticut-based blockchain developer, Martino led JPMorgan’s blockchain group and was a senior science advisor at the Securities & Exchange Commission (SEC). “Libra represents Facebook and Silicon Valley taking a major step towards becoming a sovereign state. Do we really want corporations becoming governments?” Martino asks. “From the corporation that has sold out user privacy, Facebook now offers you a bank account without interest rates, insurance or oversight. There are no term limits on who runs Libra. You can’t vote out Mark Zuckerberg for screwing up monetary policy. How does it make sense for the CEO of a $500 billion company to control a new currency? The concept of Facebook, a large corporation accountable only to shareholders, running a currency is worse than a government.”

Facebook’s old adage of ‘Move fast and break things’ is not in line with how the SEC operates. Nor Treasury. And surely not the Internal Revenue Services, which will want its share from Libra transactions.

“Using blockchain the right way can be a game-changer allowing for new economic models based on trust with partners and users,” says Danny Brown Wolf, head of partnerships and strategy at enterprise blockchain firm Orbs, based out of Tel Aviv. “Using it the wrong way may lead to a countermovement that will only highlight the lack of trust in their existing model,” he says.

Wait, is this Facebook he is talking about? The company that says sorry, my mistake, each time someone is banned? The company that, like Google, banned cryptocurrency ads a couple of years ago, during the crypto craze caused by initial coin offerings? It is. The very one, and the very Silicon Valley companies also being accused of censorship.

Which brings up the trust factor and another problem with Facebook’s Libra. Now imagine holding a few thousand Libra — and being banned from using it? Possible?

“The obvious answer is yes. If you’re banned from the Facebook platform, how would you be able to use Libra?” says Jake Yocom-Piatt, cofounder and project lead of Decred, yet another blockchain-based cryptocurrency like Bitcoin. “I don’t think a number of the promises of crypto were ever part of the plan for Libra,” he says. “Facebook is not out to make Libra permissionless, uncensorable or immutable. There are other compelling use cases, but certainly not for most of the crypto community.”

Facebook’s Libra is a ‘wake-up call’ for regulators, says ECB policymaker

(Article published by Daniel Palmer with same title in CoinDesk)

The European Central Bank (ECB) wants regulators to kick into a higher gear when it comes to developing rules for big tech firms moving into finance, such as Facebook and its Libra cryptocurrency project.

According to a report from Bloomberg, ECB Executive Board member Benoit Coeure said: “It’s out of the question to allow them to develop in a regulatory void for their financial service activities, because it’s just too dangerous. We have to move more quickly than we’ve been able to do up until now.” Such projects are a “useful wake-up call for regulators and public authorities,” said Coeure, since they pose a number of questions and may get regulators to improve the way they work.

The news comes as the latest in a string of reports indicating that global watchdogs are worried that the Libra project, in combination with Facebook’s billions of users, could pose a threat to national fiat currencies such as the dollar. There are additional concerns about Libra’s possible use in money laundering if not governed correctly

Some U.S. lawmakers are even seeking a freeze on development of the cryptocurrency, and different government agencies will hold hearings this month to discuss the project.

Elsewhere, watchdogs in nations such as France, Japan, Singapore have expressed some concern over Libra and said more needs to be known about the project. French finance minister Bruno Le Maire has previously said that “it is out of question’’ that Libra be allowed “become a sovereign currency. It can’t and it must not happen.”

Coeure argued that cryptocurrency development brings to light weaknesses in current regulations, as well as a failure of the banking system to adopt new technology, Bloomberg wrote.

Facebook Libra threat Could spur work on China’s national digital currency: PBoC official

(Article published by Daniel Palmer with same title in CoinDesk)

With Facebook’s Libra cryptocurrency potentially posing a threat to traditional money on various fronts, China’s central bank could hasten development of its own digital cash, according to a People’s Bank of China (PBoC) official.

Speaking at an event at Peking University’s Institute of Digital Finance, Wang Xin, head of the research bureau at the PBoC, said if Libra becomes widely used for international payments and effectively acts like money, “would it … accordingly have a large influence on monetary policy, financial stability and the international monetary system?”

As reported by the South China Morning Post, this risk means that the PBoC is looking at the situation with “high attention,” and could ramp up development of its own digital currency, which has been ongoing for some years. “We had an early start … but lots of work is needed to consolidate our lead,” Wang said.

Facebook’s Libra project was revealed in mid-June to be planned as a stablecoin linked to a basket of fiat currencies and government bonds. Wang indicated China needed to know precisely which currencies those would be, and whether the U.S. dollar would play a role, according to the Post. If Libra is “closely associated” with the dollar, it could mean that national fiat currencies would work alongside “US dollar-centric digital currencies,” according to Wang. He warned that China wouldn’t take that lying down, saying: “But there would be in essence one boss, that is the U.S. dollar and the United States. If so, it would bring a series of economic, financial and even international political consequences.”

Wang confimed that the PBoC had been working with market institutions on developing its central bank digital currency, according to the report. However, there is still no indication of how close it is to completion.

Facebook’s GlobalCoin may be a ‘historic initiative’

(Article published by Daniel Kuhn with same title in CoinDesk)

Facebook’s “crypto opportunity” comes with high expectations. “We believe this may prove to be one of the most important initiatives in the history of the company to unlock new engagement and revenue streams,” RBC Capital Markets’ Mark Mahaney and Zachary Schwartzman said.

The two experts expect the currency to be used for payments, commerce, applications and gaming — across Facebook’s ecosystem that includes image-based social media platform Instagram and encrypted messaging service WhatsApp. Mahaney and Schwartzman also repeated previously reported expectations that Facebook will release their currency’s white paper on June 18, following in Satoshi’s footsteps to explain the fundamental protocols that will underpin Libra, the internal codename for the project.

RBC said it plans to offer an analysis of the paper when it’s released, “to help investors analyze the underlying cryptoeconomics of the token.”

The currency is rumored to be a stablecoin backed by a number of global fiat currencies.

It has been in development for more than six months — though the company indicated it has contemplated enveloping cryptocurrency into the social network as far back as the end of 2017 — and has 100 staff working on its development. This includes two former compliance managers that migrated from Coinbase in May.

Facebook allegedly will offer employees the option to take their salary in the new currency. It has not been confirmed if the $514 billion company will offer incentive packages in GlobalCoin.

“More people will turn to bitcoin for one simple reason—bitcoin is scarce, while Facebook’s cryptocurrency is not. People will migrate over time to the most honest ledger for storing their hard-earned wealth—and that’s not fiat currencies or derivatives thereof, including Facebook’s cryptocurrency,” wrote Caitlin Long of the Wyoming Blockchain Task Force.

Now everyone is as excited about the product. Crypto-notable Charlie Shrem said: “I’m just gonna say it. I think the “FacebookCoin” is an attempt by big tech, banks and credit card companies to lure people away from Bitcoin into  “better, easier, crypto”, which is nothing more than a fiat coin being masqueraded as crypto. Millions will be fooled.”

A lobbyist from Standard Chartered will join the Facebook crypto-unit staff in September, possibly to assist with political and regulatory scrutiny in the EU. Facebook emissaries have reportedly been having lunch with the Governor of the Bank of England to see how the project may progress in the country amid Brexit.

Visa, Mastercard, PayPal and Uber are all backing GlobalCoin to the tune of $10 million dollars. This is in addition to the $1 billion in VC funding Nathanial Popper of the New York Times has reported that Facebook is seeking, either as an investment or for collateral. For as much as Facebook has raised, the company has also acquired smart contracts producer, Chainspace, to assist development.

RBC has an outperform rating on Facebook with a price target of $250 a share. Facebook’s stock is up more than 35% this year as of Thursday’s close of $177.47 a share.

El estado de Rio Grande do Norte es el primero de Brasil en reconecer blockchain como certificado digital

(Artículo publicado por Cassio Gusson con mismo título en CoinTelegraph, basado en artículo de Ronaldo Lemos en Folha de São Paulo)

El Estado de Río Grande del Norte es el primero de Brasil en reconocer como válida la utilización de blockchain para certificación digital.

Ahora, empresas, micro emprendedores y demás empresarios pueden usar soluciones basadas en blockchain para registrar la veracidad de la información de su empresa. De esta forma, una firma registrada en blockchain pasa a tener valor jurídico y administrativo. Mientras tanto, en el resto del país, las firmas digitales sólo se validan a través de la emisión del “Certificado Digital”, una herramienta centralizada que está disponible en Brasil desde 2001, tras la creación de la Infraestructura de Llaves Públicas Brasileña – ICP Brasil.

La aceptación de blockchain fue posible por medio de la aprobación de la ley 10.513, de mayo de 2019 que pasa a aceptar cualquier otro tipo de sistema “capaz de demostrar la unicidad de la firma de una institución” específicamente detallando que pasan a ser aceptados “modelos de criptografía de clave pública y privada verificados por auditoría pública por base de datos comunes”, dice la ley.

“Parece un pequeño paso, pero es el inicio de un camino que puede llevar a la digitalización de los servicios públicos y acabar con la burocracia, concretando los ideales de tecnología gubernamental”, dijo el columnista Ronaldo Lemos.

El Cointelegraph reportó que en marzo, en la quinta cámara de Derecho Privado del Tribunal de Justicia de Sao Paulo, Fernanda Gomes Camacho, consideró válido un registro de autenticidad almacenado en blockchain. La magistrada afirmó que la custodia de las pruebas a través de la tecnología es “hábil para comprobar la veracidad de la existencia del contenido”.

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