Fintech meets crypto #9
CBDCs are coming, MetaFi is here, and a few contrarian reads about Web3
Welcome to the first “Fintech meets crypto” of the year 2022.
Last year was the best year ever for Fintech and for DeFi.
Multi-billion funding rounds, huge market capitalizations, new DeFi protocols, crypto went mainstream (and only up), a lot of mergers and acquisitions.
What will 2022 bring?
I’m not a fan of making predictions but if there is one narrative that I’m sure about it’s this one:
DeFi is not going anywhere.
Crypto is not going anywhere.
Fintech will stay with us as well.
DeFi and Fintech will grow more in 2022 and will become even closer to each other.
So buckle up. Enjoy the ride. And let’s go! 🚀
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Happened last week 👀
PayPal officially confirmed that it’s working on its own stablecoin.
Not many people are aware of this fact but stablecoins are an essential part of the crypto/DeFi ecosystem. I plan to describe stablecoins in more detail in the next “Fintech meets crypto” edition.
Until then - this news is not a huge surprise to me. I don’t expect that majority of fintech/payment companies will start issuing their own stablecoins (it wouldn’t make any sense) but PayPal? Especially knowing that PayPal partnered up with Paxos in 2020 as a part of their crypto strategy. The idea seems reasonable.
Maria Munoz, a member of Congress, wants Spain to become a safe haven for cryptocurrency investors.
There is an interesting “game” being played right now across the globe. Some countries are banning crypto, others want to create pro-crypto frameworks and legislations so they can easily attract investors. And some countries are just waiting (I’m not sure for what…).
This news is just another example of this trend.
Do you know how many countries have an absolute ban on crypto? There are only nine:
To help investors better understand the digital asset space, CoinDesk Indices is introducing the Digital Asset Classification Standard (DACS).
The DACS will provide the market with structure and transparency to help classify and simplify the industries inside the asset class.
There are 6 major sectors (one of them is DeFi):
Visa is testing a platform in partnership with ConsenSys that aims to support central bank digital currencies (CBDCs).
The goal here is to start offering central banks a way to test retail applications for digital currencies they might issue.
Mastercard launched a similar CBDC testing platform in… 2020. Is Visa a bit late to the party? Yes. Does it matter? Not really. Both payment networks are getting more and more involved in crypto, stablecoins and CBDCs and I believe they have their strategies planned for the upcoming months.
I expect a lot of news about MC/Visa acquisitions and partnerships with crypto startups in 2022.
Android and Apple users in 10 Chinese cities can now download a pilot version of the country’s digital yuan wallet app directly from the iOS and Android app stores.
The wallet enables them to acquire, store and use China’s central bank digital currency (CBDC).
Do you know what is the fastest-growing app in China right now - by installs? Yes, you’re right. It’s CBDC digital yuan wallet. 261 million individual users (20% of the population) have set up e-CNY wallet so far 📈
Major milestone achieved for Chinese CBDC project. The plan, according to Chinese media, is to officially launch digital yuan nationwide after Beijing Winter Olympics in July 2022.
It looks like China will be the first country in the world that will have a fully operational and working CDBC wallet.
The Netherlands-based payment company Adyen has announced the launch of mobile Android POS terminals in the 🇺🇸 US, 🇪🇺 EU, and 🇬🇧 UK.
Mobile Android POS has been a “hot” fintech topic in the last few years. There are many smaller companies that are trying to get some traction with this type of product. However, it might be that the biggest fish in the sea will get the biggest chunk of this market.
Shopify, Square are already offering this kind of product to their customers and now Adyen joined the race.
Great reads worth your time 📚
Short paper about MetaFi. The authors of the document define MetaFi as “all-encompassing term for the protocols, products and/ or services enabling the complex financial interplay between non-fungible and fungible tokens”.
Worth reading if you want to grasp the idea of the financial layer for metaverse & web3.
📕 Finance vs. Wal-Mart: Why are Financial Services so Expensive? (by Thomas Philippon)
Let me start with the quote from the article:
“Despite its fast computers and credit derivatives, the current financial system does not seem better at transferring funds from savers to borrowers than the financial system of 1910.”
Technical but interesting article that answers the questions like:
How did we get the bloated finance industry of today instead of the lean and efficient financial Wal-Mart?
Is it possible that the IT revolution did not have any significant impact on the cost of financial services (both for retail & wholesome)?
📗 My first impressions of web3 (by Moxie Marlinspike, ex-CEO of Signal)
Ex-CEO of Signal (he stepped down a week ago) is sharing his first impressions of web3. Very thought-provoking and a must-read for everyone interested in this topic.
Moxie decided to make his own NFT and he described what he found along this journey. Various thoughts from a technical point of view.
📕 Web3 (by Scott Galloway)
Another contrarian narrative - this time offered by the bestselling author and business professor Scott Galloway.
The main thesis here is that Web3 is, so far, just Web2.1. Not that different from the current Web2. Plus Scott writes a lot about the inequality in the crypto world:
I am always eager to learn about stuff from various perspectives. And, as you can see, this week’s reads are not so pro-DeFi. They offer a contrarian view and that is good. Go and read them and see if you are thinking alike or differently.
Gold Tweets 🏅
1. Summary of major things that happened in DeFi in 2021:
2. And here are two twitter threads that sum up big fintech trends from 2021:
3. Still a lot of room for growth:
4. And three more tweets that are 🤌
Reuters @ReutersNFT sales hit $25 billion in 2021, data from market tracker DappRadar shows, but growth showed signs of slowing towards the end of the year https://t.co/UywxYhv0kf https://t.co/84KidrH3mV
That’s all for now 👋
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