Banking is Broken? Start-ups try to fix it.

I have written earlier about problems in banking security and credit card security issues. But what about some other banking issues?

Banking is Broken: A Financial Revolution is Coming article tells that a trio of startups are seeking to change the way we manage our money, by focusing on the customers traditional banks are ignoring. Banks have been slow to embrace new technology.

Finland’s Holvi, Sweden’s iZettle and Estonias TransferWise all took the stage at the Slush startup conference in Helsinki last week, and while they all offer completely different services, they are share a similar goal – to empower the customers that they believe traditional banks are ignoring.

Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. TransferWise, founded by the first ever Skype employee Taavet Hinrikus, is looking to bring the essence of Skype’s ethos of offering cut rate international phone calls to the money exchange market. Speaking at Slush last week de Geer said that iZettle was “effectively about democratising card payments.”

Keep in mind that Holvi, TransferWise and iZettle are just three of the hundreds of companies looking to cash-in on the revolution that is coming to the banking industry.

What made the article really interesting to me is that I happen to know one of the Kristoffer Lawson, Founder and CEO of Holvi. I have personally heard the story of how the company was put up, that they were applying the needed license and when they got it. But the article includes some a bold new statement: traditional banks are ignoring 80% of their customers.

Lawson believes that Holvi’s new type of account is “the future of banking” and his company is rethinking what it means to be a bank: Holvi offers customers an alternative type of current account, integrating bookkeeping and money management in a clean, simple online interface. It is designed for use by groups and organisations so they can collaborate, making it ideal for events such as Slush, which used the Holvi system for all its budgeting and ticketing operations this year.

And I have also heard of some other events in Finland do the same. The reason why such events have actively started to use the system is that Lawson had been earlier active on organizing different computer events, so he knows the needs of this type of organizations.


  1. Tomi Engdahl says:

    Jon Evans / TechCrunch:
    As prices of Bitcoin and Ethereum have skyrocketed, so have transaction fees on their blockchains, making entire categories of decentralized apps impractical

    The cryptocurrency bubble is strangling innovation

    Sure, fine, maybe it’s a bubble. OK it’s definitely a bubble, but that’s a good thing, a bubble brings attention and investment in infrastructure, which breeds real innovation. Right? Look at the dot-com boom. A lot of people lost a whole lot of paper money, but it brought us a cheap worldwide fiber backbone and companies like Amazon and Google. Today’s crypto bubble is just like that. Right?

    …So goes the theory, by which I mean, desperate rationalization. And it was somewhat true, for a while; but not any more. Cryptocurrencies have now ascended to speculative values that actually preclude any non-speculative uses. They have become so expensive that they are preventing innovation.

    Most “crypto tokens” are, in fact, just glorified hash values stored on the Ethereum blockchain — literally nothing more than a table of numbers like “address A: 10,000. address B: 20,000,” wrapped in standard blocks of code (the ERC20 and ERC721 standards, for fungible and non-fungible tokens respectively) so that they can be easily transacted.

    …Which means that every transfer of such tokens requires a transaction to be performed on the Ethereum blockchain. And as the price of ether has skyrocketed — to more than $1,000 as I write this — transaction fees have done so as well, so that the average fee for an Ethereum transaction is now around US$2.50.

    This is fine if you’re just speculating, trading hundreds/thousands of dollars worth of tokens at a time. But it is crippling if you’re actually trying to build an app that people use for anything else.

  2. Tomi Engdahl says:

    Wolfie Zhao / CoinDesk:
    Dogecoin market cap hits $1B+; price has risen 400%+ in the past month; creator says it’s a sign of broader market excess as it hasn’t been updated in 2 years — Dogecoin, the parody coin named for an internet meme featuring a Shiba Inu dog, has broken off the leash.

  3. Tomi Engdahl says:

    Ransomware and Bitcoin Enter New Phase

    The phenomenal appreciation in Bitcoin’s value against the dollar, up roughly 18x in 2017 and 4x since September, gives us pause to consider – from a security perspective – what this might mean for ransomware in the near and distant future.

    Ransomware and Bitcoin Codependency

    It is not an exaggeration to say that without each other, ransomware and Bitcoin might not exist at all. I think it’s largely understood that the rise of a virtual, anonymized and easy-to-use payment system was a key factor in making ransomware the phenomenon it is today.

    Is Ransomware Still Pressuring Bitcoin Prices?

    The most obvious explanations for the current run-up in Bitcoin are a) it’s a tulip craze or b) Bitcoin has crossed some credibility barrier and entered the mainstream. But we shouldn’t count out the ransomware float’s possible continuing contribution.

    Arguing in favor of the idea that Bitcoin was mid-wifed by ransomware, but has now crossed some hockey stick threshold into legitimacy, and is no longer particularly dependent on the ransomware economy, we see that major retailers like Overstock, Virgin Galactic, PayPal, eBay, and Expedia have begun to accept Bitcoin as payment.

    The “tulip craze/Ponzi scheme” argument also has many adherents who voice the certainty (this author included) that this is a bubble being driven by speculators, which must burst some day. Admittedly, the long-term viability of Bitcoin is a complex question to ponder, being equal parts mass psychology, macroeconomics and technical evaluation. The scenario of a Bitcoin meltdown is enhanced by pointing out that there are other cryptocurrencies available, like Ethereum, Bitcoin Cash, Ripple, and Litecoin among hundreds, ready to fill the void, without getting into the idea that governmental monetary authorities might get into the act themselves – or interfere.

    Ransomware Rainy-Day Funds

    However, there is still an argument to be made that ransomware-related Bitcoin purchases by businesses might still be contributing to the “tightness” of the Bitcoin money supply, and helping feed the upward spiral.

    malware authors (and other criminal organizations) whose holdings were substantially in Bitcoin are equally seeing their ill-gotten gains multiply.

  4. Tomi Engdahl says:

    Direxion Asset Management applies to SEC to launch leveraged and inverse Bitcoin ETFs that would up to double price moves of the cryptocurrency

    New ‘insane’ ETF proposal for bitcoin generates worry on Wall Street|tech

    Direxion Asset Management is looking to launch five bitcoin ETFs that seek up to double the moves of the cryptocurrencies daily futures trading.
    One Wall Street strategist said approving the funds would be “insane,” while another called the proposals “eye-watering.”
    However, some believe the application with the SEC is just part of the maturation process for bitcoin and its peers.

    The latest efforts to expand the way investors can buy bitcoins venture into the often misunderstood and potentially dangerous area of leveraged ETFs.

    A regulatory application from Direxion Asset Management seeks approval for five new funds — one that seeks straight-up correlation with the cryptocurrency, but four others designed to amplify price movements either up or down.

    Such so-called leveraged funds, which use derivatives to achieve their investment goals, have been on the market for years. With $34.7 billion in assets, the funds make up a small but growing part of the $3.5 trillion ETF industry, according to

    “That would be insane for them to actually approve this. Then they’re putting a rubber stamp on it as an asset, and I don’t think governments want to go there yet,”

    If approved, the latter four shares would use leverage to replicate the daily price movements of bitcoin by 1.25, 1.5 and two times respectively. The bear fund would effectively “short” bitcoin, or capitalize on declines in price.

    “There are a lot of conflicting attitudes about this thing. I don’t think the SEC can wrap their arms around this,” Cohn said. “It’s not an asset class, it’s not a currency. It’s going to be evolved into a technology. As to whether that technology is viable, that remains to be seen.”

  5. Tomi Engdahl says:

    Jon Evans / TechCrunch:
    As prices of Bitcoin and Ethereum have skyrocketed, so have transaction fees on their blockchains, making entire categories of decentralized apps impractical

    The cryptocurrency bubble is strangling innovation

  6. Tomi Engdahl says:

    China is reportedly moving to clamp down on bitcoin miners

    China banned bitcoin, ICOs and now it appears to be clamping down on Chinese miners, an important group estimated to produce some three-quarters of the world’s supply of bitcoin.

  7. Tomi Engdahl says:

    Telegram plans multi-billion dollar ICO for chat cryptocurrency

    Encrypted messaging startup Telegram plans to launch its own blockchain platform and native cryptocurrency, powering payments on its chat app and beyond. According to multiple sources which have spoken to TechCrunch, the “Telegram Open Network” (TON) will be a new, ‘third generation’ blockchain with superior capabilities, after Bitcoin and, later, Ethereum paved the way.

  8. Tomi Engdahl says:

    CES 2018 likely to feature a heavy dose of blockchain, cryptocurrency

    Rest assured digital money, blockchain, and cryptocurrency will be key themes at CES 2018 as tech vendors aim to ride shotgun with the latest buzzword.

    CES 2018 will be best known for its gadgets, electronics, and applications for the Internet of Things (IoT), but you can expect blockchain technology as well as cryptocurrency to be a major headliner.

    Cryptocurrencies such as Ripple and Bitcoin are showing signs of being a full-blown bubble. Grandmothers were asking about cryptocurrency over the holiday break.

    The underlying technology of these cryptocurrencies is blockchain, which will have a big enterprise impact for smart contracts, supply chain and security. A blockchain is a single version of the truth made possible by an immutable and secure time-stamped public ledger, copies of which are held by multiple parties.

    Blockchain shifts trust in business from an institution or entity to software and makes illiquid assets tradeable, curbs fraud, and enables devices to make transactions.

    Kodak announces the KodakCoin blockchain cryptocurrency

    The KodakCoin cryptocurrency and the KodakOne rights management platform will both be backed by blockchain security, Kodak has announced.

    Kodak has announced the launch of its KodakCoin cryptocurrency utilising blockchain security technology, which it said is aimed at enabling image rights management for photographers.

    “With KodakCoin, participating photographers are invited to take part in a new economy for photography, receive payment for licensing their work immediately upon sale, and, for both professional and amateur photographers, sell their work confidently on a secure blockchain platform,” Kodak said.

    The camera company’s “photo-centric” cryptocurrency is being launched under a licensing partnership with Wenn Digital, and will also involve a blockchain-backed image rights management platform called KodakOne.

    “Utilising blockchain technology, the KodakOne platform will create an encrypted, digital ledger of rights ownership for photographers to register both new and archive work that they can then license within the platform,” Kodak explained.

  9. Tomi Engdahl says:

    Ethereum Mining Rig
    Building computers for profit? Sounds fun AND useful!

  10. Tomi Engdahl says:

    CEO of porn cryptocurrency disappears with investor money

    A cryptocurrency built for watching live-streaming porn is turning out to be a buzzkill.

    Four investors in the digital currency, called Fantasy Market, claimed last week that its shadowy CEO disappeared with their money — and has not refunded all their investment despite repeated requests.

    The alleged inability of investors to trade out of the Fantasy Market tokens, or FMtokens, could stand as a warning to all investors in the red-hot cryptocoin market.

    Jonathan Lucas, the brains behind FMtokens, was aiming to raise as much as $25 million last year, according to Lucas’ white paper — the investment plan circulated among investors.

    FMtokens would be used to pay for viewing live-streaming porn, the paper said.

    Cryptocurrencies like bitcoin, ethereum and ripple, with their values soaring, are among the buzziest investments on Wall Street.

    FMtokens, like other initial coin offerings, or ICOs, usually have limited use — unlike cryptocurrencies — and often use the technology supporting ethereum.

    Bitcoin is the perfect currency for terrorists
    Eastman Kodak’s stock doubles after it unveils cryptocurrency
    Why Merrill Lynch won’t touch bitcoin
    Don’t expect SEC help if your cryptocurrency investments go south

  11. Tomi Engdahl says:

    In 2017 a cryptic mass hysteria started to run on crypto currencies

    One analyst is pushing the collapse and another new peaks. One thing is certain: the value of bitcoin and cryptographic currencies has risen this year.

    Bitcoin has been impressed with the main pages of the front page of the world and comments have been saddened. Authorities from bankers to officials alert the bubble accelerating pace.

    “Even the tulips had some purpose,” big investor Jim Rogers wondered on Thursday.

    The incomprehensibility of the rise of the bitcoin is related precisely to this, its function.

    The most insightful use is at present value preservation, but hard price spell does not make it in this category very tempting. As a means of payment Bitcoin is cumbersome, as one transaction takes hours and costs tens of dollars.

    The anonymity associated with Bitcoin also begins to go away, which prevents its use in money laundering and other criminal activities. There is a reason to wait for the regulation trail in the beginning of the year.

    In addition, bitcoin’s carbon footprint is extensive. Excavation and maintenance are consuming electricity at a rate that accounts for almost 40% of Finland’s electricity consumption on an annual basis.


  12. Tomi Engdahl says:

    Kodak stock price up 89% after announcing ICO

    Kodak stock price up 89% after announcing ICO
    Posted 46 seconds ago by Matt Burns (@mjburnsy)

    The 130 year old Eastman Kodak company announced an ICO yesterday because it’s 2018 and nothing matters. Since the announcement, the stock price is trading up 89%, currently at $11.90. The stock price has not been this high since March 2017.

    Kodak isn’t the first company to see explosive stock gains after announcing a cryptocurrency product. Others like Veltyco, LongFin and even Long Island Iced Tea Corp all saw triple digit gains thanks to a cryptocurrency move.

  13. Tomi Engdahl says:

    Miami Bitcoin Conference Stops Accepting Bitcoin Due to Fees and Congestion

    Next week the popular cryptocurrency event, The North American Bitcoin Conference (TNABC) will be hosted in downtown Miami at the James L Knight Center, January 18-19. However, bitcoin proponents got some unfortunate news this week as the event organizers have announced they have stopped accepting bitcoin payments for conference tickets due to network fees and congestion.

    Bitcoin settlement times, and the fee market associated with transactions, have become a hot topic these days as on-chain fees have risen to $30-60 per transaction. These issues have made it extremely difficult for businesses to operate, and many merchants have stopped accepting bitcoin for services and goods altogether. Just recently the tech giant Microsoft announced temporarily removing the “redeem bitcoin” button from the account services payment option.

  14. Tomi Engdahl says:

    Cryptocurrency security – how to store your coins safely

    Investing in cryptocurrency is hot right now. I also believe the blockchain technology will have a major impact on numerous industries

    explain how to store your cryptocurrency coins safely, protected from hackers and/or disasters.

    I’m using Dropbox + VeraCrypt to store my coins safely and secured.

    Although uploaded files Dropbox is secured with 256-bit AES encryption, it won’t protect you if someone gains remote or physical access to your computer with your coins private keys in your dropbox folder. This is where Veracrypt steps in. VeraCrypt is an opensource encryption utility to create a virtual encrypted container, e.g. within Dropbox.

  15. Tomi Engdahl says:

    Overstock and Coinbase briefly mixed up Bitcoin and Bitcoin Cash

    A glitch on Overstock’s website allowed users to send amounts of Bitcoin Cash to Overstock when the system was expecting Bitcoin, leading to drastic discounts on many items. Given that BTC is about $14,000 and Bitcoin Cash is $2,400, the mistake could have been quite costly.

    Originally reported by Brian Krebs, the exploit allowed you to send the required amount of BTC in Bitcoin Cash. Then, when you asked for a refund, the system would refund you in Bitcoin.

  16. Tomi Engdahl says:

    South Korea may or may not ban bitcoin exchanges and that’s the news

    The price of bitcoin and other cryptocurrencies dropped significantly today off the back of ‘news’ that South Korea’s government might ban trading exchanges.

    As ever in the world of crypto, the slightest ripple of information can be taken out of context, and that appears to be the case here.

    Nonetheless, with Korea being the world’s largest trader of bitcoin on a country basis, the scare was enough to spread fear and move the market.

  17. Tomi Engdahl says:

    North Korean Hackers Prep Attacks Against Cryptocurrency Exchanges: Report

    Researchers Say a North Korea-Linked Hacking Campaign is Ready to Go Against South Korean Cryptocurrency Exchanges

    North Korean hackers, loosely categorized as the Lazarus Group, have continued their attacks against South Korean interests, with particular emphasis on cryptocurrency exchanges.

    Recorded Future said they discovered a spear-phishing campaign that uses the CVE-2017-8291 Ghostscript vulnerability triggered from within a Hangul Word Processor (popular in South Korea) document.

    Earlier this month, McAfee described a separate attack against North Korean defectors from a group — almost certainly North Korean — that does not appear to be related to any known cybercrime group.

    The Lazarus targets are users of the Coinlink cryptocurrency exchange, other exchanges, and a group known as ‘Friends of MOFA (Ministry of Foreign Affairs)’.

    The cryptocurrency target is typical Lazarus.

    In December 2017, the South Korean Youbit cryptocurrency exchange went bankrupt following its second hack of the year. In the first attack it lost 4000 bitcoin or around 40% of its reserves (around $5 million at the time), and a further 17% of its assets in the December breach. Some reports suggest that the attacks were undertaken by BlueNoroff, a sub-group of Lazarus.

    South Korean exchanges have been strengthening their network defenses, while the government has been considering regulations to tighten control over cryptocurrencies.

    “This campaign relies on multiple payloads fashioned out of the Destover infostealer code to collect information about the victim system and exfiltrate files,” reports Recorded Future. Destover further implicates Lazarus in the campaign. It was used in the Sony Pictures Entertainment attack in 2014, the Polish banking attacks in January 2017, and in the first WannaCry victim discovered by Symantec.

  18. Tomi Engdahl says:

    Bitcoin drops below $10K after three days of cryptocurrency correction

    The crypto crash that began two days ago accelerated yesterday and today, with essentially all top 100 coins down anywhere between 15-30 percent. The total market capitalization of all cryptocurrencies is hovering around $450 billion, down ~30 percent from $650 billion just 48 hours ago.

  19. Tomi Engdahl says:

    6 red flags of an ICO scam

    ICOs have opened to the general public investments in blockchain ventures. In the third quarter of 2017 alone, ICOs raised more than $1.3 billion for crypto ventures — approximately five times more than funding raised through venture capital in the blockchain space.

    There were more than 200 ICOs in 2017

  20. Tomi Engdahl says:

    SEC details concerns over crypto investments, demands answers from fund managers on how mutual funds/ETFs will store, safeguard, and price cryptocurrency assets

    SEC says bitcoin funds raise ‘investor protection issues’

    The U.S. securities regulator on Thursday raised alarm about the safety of bitcoin-themed investments, telling the fund industry they want answers to their concerns before endorsing more than a dozen proposed products based on cryptocurrencies.

    The SEC’s division of investment management demanded answers to at least 31 detailed questions about how mutual funds or exchange-traded funds based on bitcoin would store, safeguard, and price that asset.

    They also asked whether investors can understand the risks and how to address concerns that bitcoin markets could be manipulated.

    Bitcoin’s 1,500 percent surge last year stoked investor demand for any product with exposure to the red-hot asset.

    SEC statement is a “really big deal” by making public concerns that fund managers would have had to address on a case-by-case basis, behind the scenes.

  21. Tomi Engdahl says:

    This week’s Bitcoin crash was all about fraud and regulation

    Cryptocurrencies have had a rough week: the value of bitcoin plunged to a mere 50 percent of its 2017 peak, and other currencies, such as Ethereum, Ripple, and Litecoin have seen double-digit losses compared to their heights from last year. Tuesday also witnessed the collapse of BitConnect, an anonymously operated crypto exchange that had been repeatedly accused of running a Ponzi scheme via its proprietary BCC currency.

    Taken together, these events may simply act as another reminder of the “volatility” of the cryptocurrency market, which saw bitcoin rise to a peak of $19,783 on December 17th.

    The value of Bitcoin plunged to a mere 50 percent of its 2017 peak

    Bitcoin has gone through multiple crashes before: in spring 2011, in November 2013, and in January 2017.

    In the United States, regulation has reared its head in the form of the SEC.

    This global movement toward harsher regulation has been cited as a major cause of the exodus of value that has gripped cryptocurrencies in the past week. It would also potentially account for BitConnect’s collapse

    A historic lack of regulation likely contributed to the current bitcoin bubble by facilitating market manipulation and duplicitous trading practices. Even as bitcoin became a household name in 2017, such practices remained common.

  22. Tomi Engdahl says:

    Bitcoin is broken?

    Stripe is ending support for bitcoin payments on April 23

    Payments platform Stripe will stop supporting bitcoin in April, citing the cryptocurrency’s volatility and long transaction times, among other things. It’s a logical decision, but one likely to anger the easily provoked crypto-crowd.

  23. Tomi Engdahl says:

    50 Cent accidentally made $8 million in bitcoin
    “Ima keep it real, I forgot I did that shit lol.”

    In 2014, rapper 50 Cent let people buy his album Animal Ambition using bitcoin. He then let his account lie unused for years, and only just recently discovered that he’s now a bitcoin millionaire, as first reported by TMZ.

    At the time, a single bitcoin was worth only $662, and the rapper’s fans could pick up the album for a fraction of that. In total, he pulled in over $400,000. Since then, the value of bitcoin has soared: the price of the cryptocurrency rose as high as $17,000 earlier this month, only to drop under $10,000 in recent weeks.

    earnings are now worth $7 million to $8.5 million

  24. Tomi Engdahl says:

    Josh Constine / TechCrunch:
    Zero-fee stock trading app Robinhood says it will let users trade bitcoin and ether starting in February using its Robinhood Crypto platform — No-commission stock trading app Robinhood will let you buy and sell Bitcoin and Ethereum without any added transaction fees starting in February …

    Robinhood adds zero-fee cryptocurrency trading and tracking

    No-commission stock trading app Robinhood will let you buy and sell Bitcoin and Ethereum without any added transaction fees starting in February, compared to Coinbase’s 1.5 to 4 percent fees in the US. And as of today Robinhood will let all users track the price, news, and set up alerts on those and 14 other top crypto coins, including Litecoin and Ripple.

    “We’re planning to operate this business on a break-even basis and we don’t plan to profit from it for the foreseeable future” says Robinhood co-founder Vlad Tenev. “The value of Robinhood Crypto is in growing our customer base and better serving our existing customers.”

    Here’s how Robinhood Crypto works. You can instantly transfer up to $1000 from your connected bank account (more if you have a Gold membership), with additional funds coming over slower ACH transfer. For smaller traders, that could eliminate the annoying delays on other platforms that can make you miss a low price you want to buy up. The whole Crypto section of Robinhood is styled with an 80s Tron design to denote the 24-hour trading window, compared to its day and night themes for when traditional stock markets are open or closed.

    When you place a buy or sell order, Robinhood gives you an estimated price, connects to a slew of trading venues, exchanges, and market centers to find the lowest price, and uses its economies of scale to improve to score better prices over time. To counter market volatility, Robinhood puts a “collar” around your trade so if it can’t execute it at close to the estimated price, it waits for the price to return or lets you know.

    And in case the price of a coin skyrockets or plummets, you can place limit orders to set a price where you automatically buy or sell. The full list of coins you can track is Bitcoin, Ethereum, Bitcoin Cash, Litecoin, Ripple, Ethereum Classic, Zcash, Monero, Dash, Stellar, Qtum, Bitcoin Gold, OmiseGo, NEO, Lisk, and Dogecoin.

  25. Tomi Engdahl says:

    After 15 years, eBay plans to cut off PayPal as its main payments processor
    The shopping marketplace will instead begin working with Amsterdam-based Adyen.

  26. Tomi Engdahl says:

    The Rise of Connected Fintech Hardware

    Right now in the United Kingdom there’s a bit of a banking revolution going on — the so-called “challenger banks” are not just mobile first, but mobile only. Without branches, or the creaking legacy technology stacks of the traditional retail banks, these banks live on your smartphone rather than on main street.

    So with the challenger banks eating their own dog food, and their developer API, as they build out their mobile applications, and the bigger retail banks being forced to offer similar access via the Open Banking API, things are starting to get interesting. While most of the third-party applications getting built are the expected ‘money management’ applications, there have been some interesting projects built around the new interfaces.

    The idea that physical hardware could be integrated with online banking to make things more tangible is an interesting one.

    making our money tangible once again as part of our environment and associated with our smart objects—becomes important.

    Yet while most of today’s internet connected smart objects are blatantly creations of technology, connected APIs and machine learning can be utilized to develop interfaces where user interaction can be more natural.

  27. Tomi Engdahl says:

    Commonwealth Bank of Australia Tries to Explain Coding Errors Found After 4 Years

    The Commonwealth Bank of Australia, the country’s largest bank, finally got around to explaining last week why two software coding errors first disclosed in 2016 laid hidden for more than four years. The errors allowed the approval of personal overdrafts for 9,577 of its customers that should have been declined, while also approving another 1,152 customers for higher overdraft limits than they were qualified for. Many of the customers were in financial distress, and the erroneous approvals allowed them to dig themselves into even deeper financial trouble. The interest rate the bank charged customers on an overdraft was a hefty 16.6 percent.

  28. Tomi Engdahl says:

    Swedes Turn Against Cashlessness

    It is hard to argue that you cannot trust the government when the government isn’t really all that bad. This is the problem facing the small but growing number of Swedes anxious about their country’s rush to embrace a cash-free society. Most consumers already say they manage without cash altogether, while shops and cafes increasingly refuse to accept notes and coins because of the costs and risk involved. Until recently, however, it has been hard for critics to find a hearing. “The Swedish government is a rather nice one, we have been lucky enough to have mostly nice ones for the past 100 years,” says Christian Engstrom, a former MEP for the Pirate Party and an early opponent of the cashless economy. “In other countries there is much more awareness that you cannot trust the government all the time. In Sweden it is hard to get people mobilized.”

    The report mentions a recently-released opinion poll, which found that seven out of 10 Swedes wanted to keep the option to use cash, while just 25% wanted a completely cashless society.

  29. Tomi Engdahl says:

    Not hacking, but operational error:

    Samsung Securities’ $105 Billion Fat-Finger Share Error Triggers Urgent Regulator Inquiry

    Last week, an employee of Samsung Securities Co., Samsung Group’s stock-trading entity and one of the largest trading companies in South Korea, accidentally issued shares worth some $105 billion to 2,018 of its employees who are members of its stock-owner program. The employees in the program were supposed to receive a dividend totaling 2 billion won (or about $0.93 per share they owned), but were mistakenly issued 2 billion shares instead. The amount issued was more than 30 times the total number of outstanding Samsung Securities’ shares.

    Embarrassingly, Samsung Securities admitted that it took 37 minutes to fix what had occurred after it became aware of the problem. Even more humiliating, sixteen Samsung Security employees were able to still sell off some 5 million shares of their payout, despite repeatedly being warned not to do so by their managers.

    Perhaps the warnings were ignored because they were able to make about 10 billion won ($9.3 million) each.

    The combined action of the mistake along with the rogue employee share sell-offs helped depress Samsung Securities’ stock price by nearly 12 percent.

    seen its market value drop about $300 million.

    After news of the error became public, South Korea’s Financial Supervisory Service (FSS) announced that it was going to initiate an urgent “special” inquiry into what it called a “big financial incident that significantly undermines the safety of and trust in [Korea’s] capital markets.” Its inquiry will be concerned with: how 2 billion Samsung Securities shares―which did not exist― managed to get allocated; how those “ghost shares” could even be legally sold by Samsung Securities’ employees; why some employees continued to sell the shares after being instructed not to; and how the employees could sell the shares without the activity being reported to the brokerage.

  30. Tomi Engdahl says:

    Nicholas Megaw / Financial Times:
    TransferWise becomes first non-bank firm to get direct access to Bank of England’s interbank payment systems to process payments without intermediary banks — TransferWise has become the first fintech group to gain direct access to the Bank of England’s interbank payment systems …

    TransferWise becomes first non-bank to join BoE payment system
    Central bank opens access to fintechs to boost competition

    TransferWise has become the first fintech group to gain direct access to the Bank of England’s interbank payment systems, as regulators and the government step up their efforts to encourage competition in the UK’s financial sector.

  31. Tomi Engdahl says:

    Ingrid Lunden / TechCrunch:
    PayPal confirms it is acquiring Swedish payments company iZettle for $2.2B in an all-cash deal, making it PayPal’s biggest-ever transaction — PayPal is taking its biggest bet yet on point-of-sale transactions, small businesses, and markets outside of the US, as it looks to raise its game against Square …

    PayPal confirms that it is buying payments startup iZettle for $2.2B in an all-cash deal

  32. Tomi Engdahl says:

    “Central Bankers Face a Crisis of Confidence as Models Fail”

    The title of this week’s commentary is the title of an FT article published at the end of last week as monetary authorities gather in Washington for the annual meetings of the IMF and World bank. It would appear that the mood is somewhat subdued…central bankers are puzzled as to why inflation is not rising as much as their models suggest.

    What we find even more amazing is that despite their growing lack of faith in their models (models that the FT describes as fiendishly complicated), some central bankers still believe that forward guidance (aka simple jawboning) is an effective policy tool even when they are worried that their fiendishly complicated models are not up to scratch. Let’s just say we’re sceptical on this front. In fact, we’re pretty sceptical whenever a central banker speaks nowadays, as they are often self-serving, duplicitous and completely ignorant of the unintended consequences which we truly believe are yet to be seen from their audacious monetary policy experiments of the last decade.

  33. Tomi Engdahl says:

    Danske Bank Whistle-Blower’s Identity Has Now Been Revealed

    Berlingske, the Danish newspaper that first reported allegations that Danske Bank A/S was being used to launder billions of dollars in dirty money, revealed the identity of the whistle-blower who helped bring the case to the public’s attention.

    Danske Chairman Says ‘Large’ Part of $234 Billion Can Be Suspicious

    The Danske scandal has engulfed the bank and dominated the political debate in Denmark, where lawmakers have scrambled to enforce much tougher penalties for money laundering. The bank is now the target of multiple criminal investigations and faces hefty fines.

  34. Tomi Engdahl says:

    How Americans Took Down a Latvian Laundromat

    The main unanswered question after closure of ABLV is allegations of the corruption.

    The end of ABLV, Latvia’s third largest bank, was fast and brutal.

    On February 13, 2018 the Financial Crimes Enforcement Network (FinCEN) at the US Treasury proposed to ban ABLV from having a correspondence account in the United States due to money laundering concerns. The agency accused the lender of institutionalising money laundering as a pillar of the bank’s business practices and failing to implement effective anti-measures, allowing its clients with ties to North Korea anti-ballistic program to circumvent the United Nations’ sanctions.

  35. Tomi Engdahl says:

    Cum-ex tax scandal cost European treasuries €55 billion

    Cum-ex tax scandal cost European treasuries €55 billion

    Most people will stare blankly when they hear of the “cum-ex” scandal, but the latest reports are that this tax evasion scandal is a continental-wide one, robbing taxpayers of at least €55 billion of state money.
    The scale of the financial damage caused by the so-called “cum-ex” tax scandal is much higher than previously thought, according to information provided to Reuters, ARD, Die Zeit and several other news organizations.

  36. Tomi Engdahl says:

    Lloyds bank to cut 6,000 jobs to create 8,000 digital ones

    The bank says that 75% of staff will be expected to move into new IT-based roles

    Lloyds banking group is planning a major overhaul to its workforce by pushing its digital operations with 2,000 new IT-based positions.

    As part of the plan, 6,000 jobs will be cut in order to create 8,000 new digital roles and Lloyds said that 75% of the affected staff will be expected to move into these new positions.

    Some specialist roles will also be recruited externally, such as data scientists and software engineers.

  37. Tomi Engdahl says:

    Liz Alderman / New York Times:
    With only 10% of Swedes using cash this year, down from 40% in 2010, officials are trying to slow its demise as they determine societal costs

    Sweden’s Push to Get Rid of Cash Has Some Saying, ‘Not So Fast’

    Cash is disappearing in the country faster than anyone thought it would. Now, officials are trying to slow its demise as they determine the societal costs.

  38. Tomi Engdahl says:

    Nathaniel Popper / New York Times:
    Low fees and high interest rates are allowing VC-funded “neo-banks” like Chime, Aspiration, Empower, and Varo to compete with the big consumer banks in the US

    The ‘Neo-Banks’ Are Finally Having Their Moment

    After the financial crisis 10 years ago, unhappy customers were expected to flee the megabanks for smaller competitors.

    It didn’t happen. And the big banks became even more entrenched.

    Now another wave of alternative banks are at it again, and they say they’ve learned from the mistakes of the upstart banks that tried — and failed — before them.

    Chime, the biggest new name to pop up, has opened two million fee-free online checking accounts and is adding more customers each month than Wells Fargo or Citibank.

  39. Tomi Engdahl says:

    Automation will be the end of banks as we know them

    The unbundling of the bank has begun.

    Just 10 years ago, the average consumer had very few financial relationships and interacted with just one or two institutions to fulfill all of their financial needs. But fintech companies are breaking up the old guard by focusing on specific things that banks have done and simply doing them better. As a result, the average consumer now has numerous financial relationships, each with a clear-cut purpose.

    The fintech revolution started after the 2008 financial crisis, and was driven largely out of frustration with the existing establishment.

  40. Tomi Engdahl says:

    Will Foldable Phones Launch at CES 2019? Here Are the Companies to Watch
    Could this be the start of a new era of smartphones?

  41. Tomi Engdahl says:

    Why contactless cards haven’t caught on in the U.S. | CNBC Reports

    Contactless, or “tap and go,” is an increasingly popular way to pay around the world. But in the U.S., only 3 percent of cards are contactless. Why? CNBC’s Elizabeth Schulze reports.


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