Market Watch | Bitcoin | $11,945 | 7 day: +4.8% | | Ethereum | $368 | 7 day: -2.9% | | All crypto | $365b | 7 day: +0.8% | | Bitcoin dominance | 60.5% | 7 day: +1% | Prices as of 5:30 p.m. EDT
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The IMF publishes a report on central bank digital currencies (CBDCs). - The IMF published a detailed report on CBDCs and held a press conference for central bankers on Oct. 19.
- The IMF acknowledges the world's accelerating interest in CBDCs.
- Aware of the potential benefits, IMF remains concerned that digital currencies are not a solution for every financial crisis, as they could obstruct individual nations from conducting sovereign monetary actions.
- Charged with maintaining international financial stability per its charter, the IMF acknowledges that technological innovations have increased the chances of adopting two forms of digital currencies that could be suitable for domestic and international transactions: CBDCs and Global StableCoins (GSCs).
- IMF warns that these currencies will be monetary policy tools but will not solve the world's economic problems.
- The report includes hypothetical scenarios envisioned by IMF officials, testing the effects of CBDC issuances.
- IMF admits that CBDCs will increase money transmitter competition by reducing the cost of transactions, and increase adoption massively due to mobile access.
- IMF warns that CBDCs are not a solution to inflation nor other sovereign stability issues in emerging markets.
- The World Bank was a collaborator in the report and warned that CBDCs could end assist illegal money flows.
- All parties agreed that CBDCs and GSCs require more a more robust legal framework and international regulations prior to large-scale adoption.
Coindesk 
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 Moscow, Russia The press office for the Bank of Russia confirms that a CBDC would help to avoid U.S. and EU sanctions. - During an interview with a local news outlet, Izvestia, central bankers stated that side-stepping the risks of foreign sanctions, especially from the U.S and EU, is one benefit of Russia's upcoming CBDC. Such a digital currency may diminish the Russian economy's dependency on the U.S. dollar.
- Note: Russia has been de-dollarizing for years, and its central bank has been one of the world's largest buyers of gold.
- The press office did not reveal how exactly it intends to avoid foreign sanctions using digital rubles.
- At present, the Russian Ministry of Finance believes it is too risky to issue a CBDC before completing its research and due diligence.
- The press office of Russia's Central Bank acknowledged that the proposed digital ruble could significantly decrease transaction costs, increase cross-border payments, and dissipate banking pressure.
- However, the current state of CBDC technology is imperfect, lacks security, and is highly volatile. Such an asset could be susceptible to illegal uses that could destabilize the economy.
- The Ministry of Finance emphasized that the issuance of CBDC would need unique payment infrastructure and new types of services.
- In a consultation paper published recently regarding a digital ruble, the central bank clarified that it would only issue a regulated CBDC backed with actual rubles.
Coindesk
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 The Central Bank of Spain is researching a CBDC. - Banco de España published a report regarding its priorities for the next four years. One of them is in-depth research into potential issuance of a central bank digital currency (CBDC) and its role with the country's existing, Euro-based financial system.
- The central bank will analyze various design proposals, including aspects of digital identification.
- The president of the European Central Bank (ECB) has urged all EU countries' central bankers to analyze the prospects and risks of a proposed CBDC called "Digital Euro."
- The ECB recently published a 55-page Report on a Digital Euro outlining scenarios, requirements, follow-ups, and working tasks.
- Banco de España has yet to share plans about how and under whom the research regarding any Spanish CBDC would proceed and how it would relate to the Euro and/or Digital Euro.
Banco de EspaΓ±a
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 Stefan Ingves, Riksbanken The central bank of Sweden is developing a CBDC. - One of the world's oldest central banks, Sveriges Riksbank, is moving forward with the development of a Swedish central bank digital currency (CBDC), according to its governor Stefan Ingves.
- His newly published commentary dated Oct. 15 reveals that Riksbank is conducting a distributed ledger technology-based pilot in collaboration with Accenture to test a technical solution for the so-called "e-krona."
- Sweden is becoming one of the most cashless countries in the world, with just 1% worth of its GDP circulating as physical paper and coins.
- The central bank governor believes that normalizing payments with digital money alternatives are impossible with technical endeavors alone. He seeks support from the Swedish parliament and government.
- The governor has not decided whether or not to issue an e-krona.
- Riksbank is currently working on RIX-INST, a new payment service, which will utilize Eurosystem's TIPS payment platform to facilitate account-to-account transfers.
Coindesk
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 Tiff Macklem, Governor of the Bank of Canada The central bank of Canada is developing a CBDC. - The Bank of Canada has publicly announced its research into a CBDC for several years.
- The central bank of Canada is now hiring an "Economist for Digital Currencies and Financial Technologies," according to an ad posted on its careers page.
- The job description asks for candidates with prior knowledge of bitcoin, ethereum, and other primary cryptocurrencies.
Coindesk
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Cryptocurrency exchange Bitstamp has purchased an insurance policy that covers losses from certain criminal acts. Its cold wallets are already insured by BitGo. The additional protection will add insurance for some hot wallets. - European cryptocurrency exchange Bitstamp announced an insurance policy for its users' digital assets that will cover losses from certain criminal acts, according to a blog post dated Oct. 15.
- Bitstamp can now insure user funds that are lost in transit, fraudulently transferred, stolen by team members. The company also added an insurance policy protecting customer deposits from legal and/or liquidation attorney's fees.
- The U.K-based Paragon International Insurance Brokers, along with Woodruff Sawyer, will offer the policies. Underwriters include various insurance companies, including syndicates of Lloyd's of London.
- The insurance policy would secure cryptocurrencies custodied by the exchange in online ("hot") environments. Cryptocurrencies held in cold wallets by BitGo, a crypto custodian, are insured by Bitgo. Bitstamp claims that 98% of the exchange's assets are held by BitGo.
Coindesk
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 Information requests by country Coinbase received 1,113 information requests from U.S. law enforcement during the first half of 2020. - The Chief Legal Officer at Coinbase crypto exchange, Paul Grewal, revealed in the exchange's transparency report that it received 1,113 information requests from the U.S. law enforcement within the first half of 2020.
- Coinbase serves approximately 38 million customers worldwide. It "regularly" receives requests for information from legal authorities and government bodies in the form of subpoenas, court orders, and warrants.
- Grewal says that the exchange is frequently required to share customer account information and financial records.
- The report notes that a team of "experienced specialists" process paperwork and decides whether to comply with a request or object to requests that are too broad.
- The San Francisco-based company will be releasing quarterly reports going forward, which is exceedingly rare among cryptocurrency exchanges.
- Grewal notes that "90% of all requests come from three jurisdictions: the U.S., U.K., and Germany."
Coinbase
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Quick Hits: - U.S. Federal Reserve chair Jerome Powell discussed the importance of cross-border payments and digital currencies at the IMF annual meeting on Oct. 19. Powell said, "it's more important to get it right than to be first" in regards to CBDC issuance.
- Real Vision co-founder Raoul Pal calls the coming era of CBDCs "Bretton Woods 2.0."
- Juan Benet, the founder of Filecoin (FIL), denied allegations that Filecoin miners are on strike (see yesterday's report) and are merely producing blocks slower than usual, according to a tweet on Oct. 19. Benet further claimed, "Miners are following the protocol, and making a TON of money doing so."
- French Finance Minister Bruno Le Maire criticized cryptocurrency usage in a tweet dated Oct. 19, saying that many are associated with drug trafficking, weapons purchases, and money laundering.
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 |  | Written and curated by wide-eyed bitcoin watcher since $1, Aaron Wise. Streaming headline junkie, Associated Press fanboy, eye-strained news terminal watcher, 2017 founder of Cryptocurrency Newsfeed. Temporarily based in Florida while awaiting the construction of cryptopia. |  | | Editor | Edited by Eduardo Garcia in New York. Eduardo is writing an illustrated book about climate change that will be published by Ten Speed Press, an imprint of Penguin Random House. Bylines in The New York Times, The Guardian, Slate, Scientific American, and others. In one of his previous lives, Eduardo worked as a Reuters correspondent in Latin America for nearly a decade. | |
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