Daily Digest - 17 March 2023

Headlines

▌Swiss Banking Association proposes issuing deposit tokens on a public blockchain

The Swiss Banking Association (SBA) released a white paper on deposit tokens. The white paper proposes issuing deposit tokens on a public blockchain to settle transactions of tokenized assets. In addition to digital assets, it also focuses on future payments, including retail wallet-based payments, micropayments, and enterprise payments. Interoperability is seen as a fundamental principle of deposit tokens. The SBA envisions three possible approaches. One avenue is so-called coloured tokens, where each bank issues tokens according to its own rules. Another option is to standardise tokens, where each institution issues its own tokens, but there are standard rules that must be fully supported. The third path is Union Token, which is the path favoured by the SBA.

Policies

▌India’s Finance Ministry has brought crypto assets under the Prevention of Money Laundering Act

The government has laid out the nature of transactions to be covered under the Act, which includes conversions between fiat and crypto, crypto transfers, and transfers of private keys, among others.India’s crypto industry has also brought together senior leaders from both the Indian government and the opposition to discuss India’s G20 presidency, and Web3 opportunities for the country.

Blockchain application

▌UAE DMCC cooperates with South Korean Yuan Universe Company

Sources revealed that Dubai Multi Commodities Center (DMCC) recently announced that it has signed two memorandums of understanding with a South Korean metaverse platform, planning to establish a partnership to promote the expansion of the UAE’s global Web3 business. Founded in 2002, DMCC is the largest free trade zone in the UAE; in 2021, the government launched the DMCC Encryption Center, a comprehensive ecosystem for enterprises in the encryption and blockchain fields. The data shows that, of all MENA countries, the UAE is the most crypto-focused country.

Cryptocurrency

▌DeFi protocol Sovryn launches Bitcoin-backed stablecoin DLLR

The Bitcoin-based DeFi protocol Sovryn launched a 100% Bitcoin-backed stablecoin Sovryn Dollar (DLLR). DLLR is aggregated from other Bitcoin-backed stablecoins and pegged to the U.S. dollar.

▌Crypto firms in Hong Kong are still struggling to find banking partners

Following the closure of Silvergate and Signature Bank, cryptocurrency firms in Hong Kong are keen to find banking partners to serve them, including in Hong Kong itself. Industry insiders have said, however, that banks in the city are not keen to serve them.Despite Hong Kong’s push to become a crypto hub, banks still have stringent requirements when dealing with crypto businesses, and the Hong Kong Monetary Authority still requires banks to perform due diligence and ongoing monitoring of clients, which includes assessing their AML and CFT controls.