TFU | Oct. 8-14

Leading Off

Over fifty consumer groups submitted a comment letter to the CFPB protesting its proposed “disclosure sandbox”; North Dakota’s Securities Department issued cease and desist orders against three companies offering ICOs; PwC is partnering with a decentralized lending platform to develop a new stablecoin; PayPal and Walmart announced a new partnership enabling PayPal mobile users to access their accounts at Walmart store terminals; former NEC director Gary Cohn joined Spring Labs as an advisor; and losses related to crypto hacks in 2018 are approaching $1 billion.


In the News

Consumer groups decry proposed CFPB sandbox. Fifty consumer groups, including the Center for Responsible Lending and the National Consumer Law Center, submitted a comment letter to the Consumer Financial Protection Bureau (CFPB) protesting its proposed “disclosure sandbox.” The groups argue that the proposal is “far outside” the CFPB’s authority and also would not benefit consumers.

North Dakota regulator issues cease and desists against ICOs. North Dakota’s securities regulator issued cease and desist orders for three companies offering “unregistered and potentially fraudulent securities in the form of ICOs.” The agency, which has repeatedly taken action against ICO projects, mirrors the increase of actions occurring at the U.S. federal level.

Figure unveils new blockchain-enabled home equity loans.  The San Francisco-based lender, led by former SoFi CEO Mike Cagney, claims its AI- and blockchain-enabled platform accelerates the home equity loan process. This market is “ripe for innovation,” said Wendy Harrington, Figure’s chief marketing officer.  “No one has touched this [paper-based] process for decades.”

PwC partners with Cred to develop stablecoin. The global audit and consulting firm is teaming up with the decentralized lending platform, Cred, to help develop a new U.S. Dollar-pegged stablecoin. PwC is the latest in a recent string of firms that have launched cryptocurrencies pegged to a fiat currency or backed by collateral, which are designed to facilitate trades with a variety of fiat and digital currencies.

PayPal partners with Walmart to launch in-store cash services. The partnership will enable PayPal mobile app users to add money to their accounts and access their cash balances at Walmart Service desks, in-store ATMS, and cash registers. The deal marks the first time that PayPal mobile app users will be able to withdraw cash while in a brick-and-mortar environment.

Gary Cohn joins Spring Labs advisory board.  The former president of Goldman Sachs and former director of the U.S. National Economic Council joined the board of advisors for the blockchain startup, which is developing a network to facilitate the secure “sharing of identity, fraud and underwriting information among financial institutions.”



Tandem launches new credit card for U.K. customers without credit histories. The digital challenger bank, founded by fintech entrepreneur Ricky Knox, launched its second credit card last week, which is fully integrated with Tandem’s personal finance mobile app. Dubbed the ‘Journey Card,’ Tandem says the new credit card is “a way for those who haven’t had credit before to build up a strong credit profile.”

Clearmatics raises $12M. The blockchain firm, based in London and Silicon Valley, brought in $12 million in new funding, led by Route 66 Ventures. Clearmatics is preparing to go live with its new Protocol Provider service, which will support the launch of the Utility Settlement Coin, a forthcoming cryptocurrency collateralized by central bank money and backed by 17 global banks.

Starling Bank expands “Banking-as-a-Service” offering. White label services from the U.K. challenger bank allow organizations to offer retail banking and payments services through its APIs, with current clients including fintechs and a U.K. government department. According to Chief Executive Anne Boden, “the API economy is far more important . . . to banking than PSD2 and Open Banking.

2018 crypto losses due to hacking approach $1B.  Losses in the cryptocurrency market due to data breaches have continued to rise, with the total amount stolen in 2018 nearing $1 billion, according to a report from blockchain security firm CipherTrace. The hacks have been both “smaller robberies on a regular basis and sophisticated . . . hacks at both the exchange and platform levels.”

Tencent invests $180M in Brazil’s Nubank. The Chinese social media giant will acquire a minority stake in the Brazilian fintech, with $90 million going towards a capital increase and $90 million being spent to acquire shares from existing shareholders. The deal is Tencent’s first investment in the Brazilian market.

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