Libra Marches on Following the Association’s First Member Meeting

The Libra Association – a consortium of companies who governs over Facebook’s proposed stablecoin Libra – held its first meeting on Monday in Geneva, Switzerland.

Following the meeting in Geneva, the twenty-one organizations formally signed the Libra Association charter as well as named its board of directors and formalized the consortium’s executive team.

As such, the five-member board is comprised of Calibra cofounder David Marcus, Andreessen Horowitz general partner Katie Haun, Xapo CEO Wences Cesares, PayU general counsel Patrick Ellis, and Kiva chief strategy officer Matthew Davie. PayPal veterans Bertrand Perez, Dante Disaprte, and Kurt Hemecker will comprise the Association’s executive team.

Most major decisions will require a majority vote of the ruling council, whilst proposed changes to membership or management of the reserve must pass by a two-thirds majority.

In addition to Calibra, the association consists of Coinbase, Xapo, Anchorage, Bison Trails, Creative Destruction Lab, Andreessen Horowitz, Thrive Capital, Ribbit Capital, Union Square Ventures, Breakthrough Initiatives, Illiad, Vodafone, Farfetch, Uber, Lyft, Kiva, Mercy Corps, Women’s World Banking, Spotify and PayU, according to a press release.

The news follows a string of significant departures of major companies such as Visa, PayPal, MasterCard, Stripe, eBay and Booking from the Facebook-led stablecoin project. Most announced their withdrawals from Libra citing concerns over the regulatory backlash faced by the project.

Still, according to the Libra Association more than 1,500 institutions have expressed interest in joining the project, with 180 meeting the organization’s membership criteria. In June, Facebook claimed a consortium of 100 companies would back the cryptocurrency project at launch.

However, the association shared no updates regarding those plans nor the exact launch date. Although Facebook initially targeted an early 2020 launch date, recent statements by CEO Zuckerberg have put this timeline into doubt.

Meanwhile, financial regulators around the globe have expressed their opposition to the project, citing fears that Libra could destabilize the global monetary order. Ministers in France and Germany stated they were against Libra and India announced that Libra may not even be legal in the country. Most recently, U.S. Rep. Maxine Waters (D-Calif.) called for a moratorium on the project until all regulatory questions could be cleared.

However, Calibra’s Marcus has claimed that these fears are misplaced. He recently testified before the U.S. Congress, trying to dispel the concerns of both the Senate Banking Committee and the House Financial Services Committee.  Mark Zuckerberg is also slated to testify about the project before the House of Representatives Financial Services Committee.

Despite regulatory backlash, the Libra Association remains optimistic about going forth with the project. Dante Disparte, the head of policy and communications at Libra Association, stated that the recent flight of major backers is “a correction; it’s not a setback.” Nonetheless, he admitted that any delay to the launch will be a result of its regulatory issues, rather than technical concerns.

Thailand Has First SEC-Approved ICO Portal

SE Digital Co., Ltd. (SE Digital) – a subsidiary of a leading Thai financial services firm Seamico Securities Plc (ZMICO), has been officially granted approval by Securities and Exchange Commission (SEC) to operate in Thailand as an Initial Coin Offering (ICO) Portal.

Announced on October 11th by The Bangkok Post, the ICO Portal will mark the official beginning of the regulated digital capital market and contribute to the economic advancement of Thailand.  Accordingly, SE Digital plans to launch Thailand’s first investment token, with a target transaction size of 2-3 billion baht (around $65,800,000-$98,700,000).

As an ICO Portal, SE Digital provides a highly secure feature-rich digital platform for capital raising as well as diverse financing solutions. Due to its team of experienced professionals and robust technology platform, the company is able to offer customized comprehensive solutions for each client.

As this marks a new chapter in Thailand’s capital market history, SE Digital plans to offer a broad set of services for ICOs, including strategic advisory, primary issuance as well as support for secondary market access, from compliance to investor communications.

The company will vet prospective token issuers before they seek approval from the SEC and assist them in meeting requirements such as Know-Your-Customer (KYC), CDD, Anti-Money-Laundering and investor suitability. It will also conduct due diligence on the proposed tokens before allowing them to reach investors.

In addition to that, apart from retail investors in Thailand, institutional investors, ultra-high net worth individuals, venture capital, and private equity funds will also be able to invest in these digital tokens.

Stephen Ng, Chief Marketing Officer at SE Digital, has stated the SEC’s approval was made to open a new chapter in Thailand’s capital market history and pave the way to its digital economic transformation, as it becomes one of the first ASEAN nations to offer fully-compliant ICOs. He emphasized:

“SE Digital will be able to promote the tokenisation of traditional assets providing investors with access to previously illiquid and difficult to access assets such as commercial real estate and investment products with global exposure, while offering issuers with a new fundraising alternative that allows access to a wider pool of capital providers with cost savings accrued from the digitisation on the blockchain.” 

He further added that Thailand has already a strong foundation for digital transformation, seeing as the country has positioned itself as a regional financial hub, a growing and vibrant start-up community, and a progressive regulatory regime that promotes digital innovation.

Furthermore, as digital tokens is a new subject to most Thai investors, SE Digital announced that it plans to introduce a series of educational programs through cooperation with its local partners, regulators and leading organizations.

“As asset tokenisation fully takes hold, it will help bolster innovation and competitiveness of Thailand’s capital markets. This digital transformation will bring Thais, public sectors and private sectors forward by providing them with greater access to capital formation and new investment opportunities, enhancing transparency, and automating of costly compliance requirements,” concluded.

Meanwhile, Seamico Securities’ strategic investor – Elevated Returns, has seemingly applied to the Thai Securities and Exchange Commission (SEC) for a Digital Assets Exchange License with the goal to launch a new trading venue that would provide a secondary market for such tokens by 2020.

Finablr Partners with Samsung Pay for Cross-Border Payment System

UK-based payments platform Finablr and Samsung Pay, the mobile payments service of South Korean tech giant Samsung, have joined hands to pool resources to build a cross-border payment system named “Money Transfer” for its users.

The partnership was announced on October 3rd by Finablr, explaining that the newly added feature will offer seamless and secure cross-border payments to 47 countries by using a variety of payment methods available on the app. Furthermore, United States-based Samsung Pay’s clients reportedly can use their debit or credit cards to send money via the Samsung Pay app.

Currently, there are over 25 million people using Finablr’s services across the globe, and the company has established a presence in 170 countries across the world.

According to the announcement, all the fees and exchange rates are included upfront, allowing users to know in advance what they will be paying. The system’s security also employs tokenized credentials backed by Samsung Knox.

Sang Ahn, the vice president and head of content and services division at Samsung Electronics America, further added that partnership with Finablr is part of a larger plan to expand the reach of Samsung Pay.

“Money Transfer is a first step in our vision to evolve Samsung Pay into a platform that makes users’ financial lives more convenient. The range of services in Samsung Pay, developed in close collaboration with industry leaders such as Finablr, positions us to positively impact consumers’ everyday financial experiences.”

Whilst the Money Transfer feature is now rolled out to the United States userbase, the new service will be expanded to more markets next year, according to the press release.

Meanwhile, last year in December Finablr joined Ripple’s network of banks and payment providers. In addition to that, Finablr’s UAE Exchange is using Ripple’s cross-border payments technology to power remittances to Asia. Some RippleNet members are already using XRP for the base currency for cross-border payments.

The new partnership between Samsung Electronics America and Finablr could potentially benefit XRP, especially if the payment system they’re working on integrates XRP. However, neither Samsung nor Finablr have disclosed whether they are considering the use of blockchain technology or the digital asset XRP.

Samsung is an early supporter of blockchain and crypto assets. The company’s Blockchain Keystore app is available on the company’s new line of Galaxy S10 smartphones, allowing people to store their private keys for Bitcoin, Ethereum and Ethereum-based tokens.

Apple’s Tim Cook Dismisses Cryptocurrency Plans

In most recent news, giant technology company Apple has announced that it has no intention to follow social media platform Facebook in creating its own cryptocurrency, according to the company’s CEO Tim Cook.

Speaking in an interview with French media magazine Les Echos on October 4th, Tim Cook has straight out denied rumors that Apple could release its own currency tokens.

He further argued that private companies shouldn’t be competing with states on monetary control, explaining:

“No. I deeply believe that money must remain in the hands of states. I am not comfortable with the idea that a private group creates a competing currency. A private company does not have to seek to gain power in this way.”

His comments take a notable dig to both Facebook, which is currently developing its Libra digital currency, as well as other competitors.

Facebook’s Libra initiative has been under scrutiny from regulators across the globe over its potential risk to financial stability and national monetary policies. Libra has faced this narrative a number of times already, from the U.S. Senate, France and Germany, and a group of other central bankers, amongst others.

Last month, Apple Pay vice president Jennifer Bailey mentioned that the company is “watching cryptocurrency,” thinking it is “interesting” and that it has “long-term potential.” But Cook seems to have put that notion to rest.

 “Money, like defense, must remain in the hands of States, it is at the heart of their mission. We elect our representatives to assume government responsibilities. Companies are not elected, they do not have to go on this ground,” the Apple CEO further added.

Meanwhile, Apple has been exploring blockchain technology and putting its efforts into building its fiat-currency payments initiatives with both Apple Pay and Apple Card aimed to make payments work smoothly across its devices.

At the moment, Apple is aiming at market share with players such as Visa, Mastercard and PayPal via Apple Pay.

In February, the Cupertino – California-based firm – submitted a filing with the Securities and Exchange Commission (SEC) that mentioned Apple’s involvement in the drafting of “Blockchain Guidelines” for the Responsible Business Alliance’s Responsible Minerals Initiative. The group seeks to use blockchain in mineral supply chain due diligence.

Morningstar to Build Evaluation System Underpinned by Blockchain Technology

Financial services Morningstar Credit Ratings has announced plans to implement an evaluation system for debt securities issued as tokens on a blockchain, aiming to make the emerging asset class more credible for investors.

According to the report, the new rating system for rating bonds will be implemented directly on the Ethereum blockchain and eventually on other blockchains as well by using a technology called an oracle. Oracles move trusted data, like a Morningstar rating for instance, onto a blockchain in a secure way that ensures the rating isn’t doctored, allowing it to be used as a term in a smart contract.

The oracle relies on third-party providers to convert business debt into tokens similar to Bitcoin. The securitized tokens are then dispersed to investors via a smart contract, with the terms of the investment, the public addresses of the investors and the Morningstar rating all operating on the blockchain.

The new evaluation system is set to give publicly available ratings of one to five stars to crypto assets, whilst the company’s premium custom service will utilize its internal modeling to help clients evaluate and assess given investments. The company further added that the public ratings could be launched later this year. Their premium service, on the other hand, will be made available by the end of 2020.

Chief Operating Officer at Morningstar Credit Ratings, Michael Brawer, has stated in an interview that this evaluation system could allow and facilitate the shift of the $117 trillion debt securities industry to a decentralized financial network.

Seeing as the industry is overseen and governed by custodians and trustees, the availability of an evaluation system that allows customers to assess investments and make decisions based on that, could enable billions of dollars investment to enter the crypto space as the new rating services can make the new asset class more credible.

Brawer further stated:

“We’re looking to see how we can also provide credit opinions, whether it’s a credit rating or different types of credit data and credit analytics that accompany those debt instruments, and we’re also looking to provide our services on a blockchain.”

Brawer explained that the company had seen the demand for rating services within the crypto space when it was approached by a range of investors who issue and securitize debt securities, including small business loans and home equities on blockchain.

“The objective would ultimately be to allow investors in a digital debt security to be able to run an independent, third-party model and see the results of that model on the blockchain,” says Brawer.

According to the report, Morningstar’s rating services covers both government and corporate bonds,whilst its blockchain products are still limited to structured debt instruments.

The company offers both security and convenience through their services, and investors can directly connect lenders and borrowers, as well as eliminate custodians and trustees in a transaction and saving as much as 500 basis points in fees.

At the moment, due to the stringent regulatory framework imposed by the US Securities and Exchange Commission (SEC), the company could end up having to change their blockchain methodology.

Meanwhile, there are a few potential candidates who would partner with Morningstar to launch the product, which includes fintech startup Figure, alternative investment company Cadence and DeFi platform Polymath.