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Manny Alvarez was appointed Commissioner of the California Department of Business Oversight; lawmakers introduced a proposed bill to regulate companies’ use of AI tools; Coinbase launched a debit card in the U.K. tied to users’ cryptocurrency accounts; WeLab became the fourth company to acquire an online-only banking license in Hong Kong; U.K. challenger bank Monzo raised $100M in Series F funding; and N26 faced regulatory scrutiny from German regulators over its handling of customer complaints.
In the News
California DBO appoints new head. The California Department of Business Oversight (DBO), the state’s’ financial services regulator, named Manny Alvarez its new Commissioner. Mr. Alvarez has both industry and government experience, formerly serving as an enforcement attorney at the Consumer Financial Protection Bureau and most recently as General Counsel and CCO for fintech lender Affirm.
Lawmakers introduce AI regulatory bill. The Algorithmic Accountability Act [full text], proposed by Senators Ron Wyden (D-OR) and Cory Booker (D-NJ), would require firms to audit their AI systems for bias and discrimination, and take corrective action on identified issues. It would also require an additional audit of all processes involving sensitive data like biometric and genetic information.
Maria Vullo named FinTech Innovation Lab “Regulator in Residence.” The former head of New York’s Department of Financial Services will join the accelerator program for enterprise technology companies, run by Accenture and the Partnership for New York City. Vullo said she looks forward to helping firms “understand the regulatory [and] compliance environment.”
Chinese government proposes ban on crypto-mining. China’s National Development and Reform Commission included crypto-mining in a list of wasteful activities slated for elimination. China is the global epicenter of mining, despite a ban on cryptocurrency trading. The process has grown notorious due to its energy consumption, and the proposed ban could take effect on May 7.
N26 faces regulatory scrutiny over complaint handling. The German mobile bank is reportedly being probed by German regulators following complaints about fraudulent transactions and deficiencies in customer communications. N26 says it has tripled the number of staff in its customer complaints division in the past year and will respond to other issues in consultation with regulatory authorities.
Coinbase launches U.K. debit card. The U.S. cryptocurrency exchange partnered with card-issuing platform Apto Payments to offer a Visa debit card that allows customers to make payments and withdraw cash directly from their cryptocurrency accounts. Coinbase says it is the first card of its kind in Europe. No timeline has been announced for a U.S. roll-out.
JP Morgan launches Sepa instant payments in Europe. The banking giant launched Sepa Instant in Europe, boosting its real-time payments offering. The bank says that the service will allow “clients [to] benefit from immediate payment finality, easier reconciliation, better budgeting and improved liquidity management.”
WeLab granted Hong Kong virtual banking licence. The Hong Kong-headquartered fintech is the fourth company to be awarded an online-only banking license by the Hong Kong Monetary Authority (HKMA). According to the HKMA, WeLab intends to launch its service within six to nine months. There are four applicants left to be processed on the HKMA’s shortlist for the online-only banking license.
Monzo to raise £100M for £2B valuation. According to TechCrunch, multiple sources have indicated that U.S. startup accelerator Y-Combinator will invest £100 million in the U.K. challenger bank in Series F funding. The new round will value Monzo at almost £2 billion, up from £1 billion following its £85 million raise in October last year. Monzo is also reportedly planning its U.S. launch.
Betterment offers new funds. The robo-advisor will begin offering a new family of funds to independent advisors, who will be able to buy and sell them on behalf of clients free of commission on the company’s platform. The offering, Dimensional Fund Advisors, has $576B in assets under management.
Debate over specialized chips threatens to split Ethereum. As specialized crypto-mining firms roll out bespoke chips to mine Ethereum, developers are building an algorithm to slow them down. The algorithm, which has not been accepted by core developers, is leading to a “governance crisis” undermining Ethereum’s development and its applicability for enterprise applications.