TFU | Feb. 12-19

Leading Off

Chat firm Telegram raised $850M in preparation for its targeted $1B ICO this year; Coinbase will no longer allow U.S. users to add new credit cards as a payment option; the U.K. FCA is considering expanding its regulatory sandbox globally; Australia rolled out its real-time payments system; U.K. challenger bank Monzo is exploring U.S. expansion; and CNBC investigated crypto firm Riot Blockchain, the rapid rise of its stock, and its regulatory “red flags.”

In the News

Telegram raises $850M, aims for $1B ICO.  The chat firm raised $850 million to help develop the firm’s proprietary blockchain and its Telegram Messenger app, with some investors already doubling their investments through early trading. The initial fundraise is expected to be only the first stage in the firm’s plan to raise over $1 billion through an initial coin offering (ICO) in March.

CME Group explores changing blockchain rules without consensus.  The global derivatives marketplace applied to the USPTO for patents to “modify a blockchain’s rules without requiring consensus from all of the network’s nodes.” Consensus, a key element of blockchain, can cause problems for use-cases involving modifiable rules, like frequent flyer programs.

Coinbase removes credit card payment option for U.S. users.  The popular cryptocurrency exchange will no longer allow U.S.-based users to add new credit cards to their profiles, following a recent trend in which “credit cards issued by four U.S. banks are barred from being used to buy cryptocurrencies.” Debit cards remain a payment option for Coinbase users.

FCA looks into expanding its regulatory sandbox.  The U.K. Financial Conduct Authority (FCA) is seeking input on a “global regulatory sandbox” that would allow fintech firms to test their products in multiple jurisdictions at the same time in collaboration with local regulators. The FCA already has nine bilateral agreements in place, but does not yet allow “joint sandbox” testing.

Australia debuts real-time payments system.  The country’s “New Payments Platform” (NPP)  allows customers of Commonwealth Bank, National Australia Bank, and Westpac to “send money via a service called PayID, which requires users to enter only the recipients’ mobile phone number or email address.” Transactions on the NPP are executed and settled in seconds.

Monzo is exploring a U.S. launch.  The U.K.-based digital bank has had “preliminary discussions” with regulators about entering the United States. Monzo’s CEO said it is an attractive target because American bank innovation has not stayed current with mobile technology. European digital banks Revolut and N26 are already planning to launch in the U.S. in the coming months.

Cross River Bank partners with PeerIQ.  The New Jersey-based bank will work with the consumer loan data analytics firm to help “streamline capital sourcing between online lenders and institutional loan buyers” by combining “Cross River’s capital, technology, and regulatory compliance processes with PeerIQ’s risk management platform, loan and borrower data sets.”

SVB selects seventh fintech class.  Silicon Valley Bank (SVB) chose its latest cohort of fintech startups to join its in-house accelerator. The five firms are “focused on student loan repayment assistance . . . and easing . . . payment pain points.” SVB aims to help the firms “make the leap from their incubator stage to their Series A.”

CNBC investigates Riot Blockchain.  CNBC ran a piece on the crypto firm, which saw its share price rise to over $40 from $8 after rebranding in October. Previously known as Bioptix, the firm was known for its veterinary products patent and disease testing. CNBC notes that Riot’s “red flags” make it “like the type of newly minted blockchain company that has gained SEC attention.”

Congress hears testimony on AI.  The House Subcommittee on Information Technology held a hearing on “the current state of AI, barriers to adoption as well as how government might benefit from using the technology.” Academics and executives from Intel and Nvidia, two of the largest AI chip-makers, spoke at the hearing “to encourage research” by the government.


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