TFU | Feb. 4-10

Leading Off

Wells Fargo experienced widespread online and mobile banking outages; Facebook acqui-hired key members of a British blockchain firm to advance its blockchain efforts; fintech firm Pagaya announced its AI platform will actively manage $100M in asset-backed securities; controversial crypto evangelist Brock Pierce wants to reboot infamous Japanese crypto exchange Mt. Gox; and SEC Commissioner Robert Jackson said he believes a bitcoin ETF will eventually be approved.

 

In the News

 

Outages hit Wells Fargo.  The U.S.’s third-largest bank by assets experienced widespread systems failures on Thursday, leaving customers unable to access online banking and mobile applications. This is the second time in a week that Wells has experienced technology issues, and they come after the bank received a regulatory warning from the OCC in recent months regarding its technology oversight.

Facebook “acqui-hires” blockchain startup.  The social media giant hired four of the five founding members of Chainspace, a London-based blockchain firm set up by University College London researchers. Facebook has been guarded about its plans for blockchain, exploring use-cases that include “healthcare, equitable financial services, [and] new ways to save or share information.”

Pagaya uses AI to manage $100M ABS pool.  The fintech firm, which develops AI solutions for asset management, announced it will use AI to select, purchase, and actively manage a pool of asset-backed securities (ABS) worth $100 million led by structuring agent Cantor Fitzgerald. “We’re thrilled to [pave] the way for practical uses of AI in the ABS market,” said Gal Krubiner, Pagaya’s CEO and co-founder.

Mizuho wants to use AI to process handwritten documents.  The Japanese financial services group is developing an “AI-based tool for automating data processing of hand-written documents and non-standard forms.” The tool will use AI, optical character recognition (OCR), and robotic process automation (RPA) technology to streamline its existing, time-intensive, manual data-entry process.

Brock Pierce wants to revive Mt. Gox.  The controversial crypto figure is planning to reboot Mt. Gox, the Japanese crypto exchange that imploded in 2014 after hackers stole millions of dollars in bitcoin from users. Pierce wants to return at least some of the 850,000 bitcoin lost in the collapse, one of the most significant negative events in bitcoin’s 10-year history, but crypto CEOs are skeptical of his plan.

Exchange CEO’s death freezes $145M in digital assets.  Crypto exchange Quadriga CX cannot retrieve $145 million worth of users’ digital tokens following the death of CEO Gerald Cotten, who had sole access to its passwords and business records. Cotten had placed the “majority” of Quadriga’s digital coins into “cold storage”; and attempts to access an encrypted USB so far have failed.

ECB considers using instant payments to break Visa/Mastercard duopoly.  The European Central Bank (ECB) is considering using instant payment rails to link up national card schemes as a means of breaking Visa and Mastercard’s dominance in the payments market. The card giants currently represent 80% of all EU card transactions.

NY Fed to assist Bangladesh Bank in cybercrime suit.  The New York Federal Reserve will provide “technical assistance” to Bangladesh Bank in its lawsuit to recoup $81 million stolen in a massive 2016 cyber heist that exploited vulnerabilities in the SWIFT network. Bangladesh Bank has filed suit against Philippines-based Rizal Commercial Banking Corp, which allegedly received the fraudulent payments.

Raisin raises $114M in new funding.  The German fintech closed a $114 million Series D round led by Index Ventures, PayPal, Ribbit Capital, and Thrive Ventures. The firm, which connects customers with savings and investment products from over 60 European partner banks, has now raised $200 million since launching in 2012. It will use the cash for strategic acquisitions and international expansion.

FCA scrutinizes Revolut ads for misleading statements.  The U.K. Financial Conduct Authority (FCA) will look into ads made by the London-based challenger bank after the country’s Advertising Standards Agency flagged it for misleading advertisements. Revolut released print ads that purported to show some customer purchasing patterns, but which used numbers that it admitted were “just made up.”

SEC commissioner believes bitcoin ETFs will eventually be approved.  In an interview with Roll Call, Commissioner Robert J. Jackson Jr. said he believes a bitcoin exchange-traded fund (ETF) will ultimately be approved. To date, the SEC has rejected at least 10 proposals for bitcoin ETFs, including one from Cameron and Tyler Winklevoss, citing both market manipulation and liquidity concerns.

 

 

 

 

 

 

 

 

 

 

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