Selected articles of the week:
Banks are increasingly expanding their services to the new asset class of digital assets. In the U.S in particular, a clear trend has been evident for some time with the entry of financial giants JPMorgan, Goldman Sachs and Wells Fargo into the sector. While the custody of digital assets is usually outsourced to third parties such as Coinbase and NYDIG, the oldest bank in the USA is taking a step further. BNY Mellon, founded by Alexander Hamilton and with over $2.1 trillion in assets under management, is the first of the established financial institutions to start custodying cryptocurrencies for selected customers. The world’s largest custodian bank is thus expanding its core area into the crypto sector.
BNY Mellon is the first of the 8 systemically relevant US banks to hold cryptocurrencies in its own custody to allow customers to trade them.
Not only market participants are positioning themselves in the field of cryptocurrencies, but also regulatory authorities want to ensure their jurisdiction in the sector. In the USA, the SEC is engaged in a quest for dominance among the various agencies. Founded in 1929, the U.S. securities regulator, whose remit includes maintaining the safety of securities markets and protecting investors, is reportedly investigating Yuga Labs. The company behind the Bored Ape Yacht Club (BAYC) is said to be under investigation for possible violations of investor disclosure rules related to the sale of its non-fungible tokens (NTFs). At the same time, the Treasury Department’s Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) are fining crypto exchange Bittrex for sanctions violations.
The founder of Bored Ape Yacht Club, Yuga Labs, and crypto exchange Bittrex are suspected of having engaged in illegal activities.
It is one of the core questions of digitization. Can digital products keep up with physical objects or are they even better? Is Bitcoin the better gold, the Metaverse the more efficient meeting space, do NFTs embody the future of artworks? As so often, the answer lies in between and ultimately depends on the viewer’s sense. Perhaps digital materials are simply the perfect complement to the changes taking place over time. The fact that digital artworks in the form of NFTs certainly have their raison d’être is demonstrated by the experiment of British conceptual artist Damien Hirst. Hirst let buyers of his latest art installation, which was created from 10,000 handmade individual works in paper format, decide whether they wanted to purchase the creation physically or as a tokenized NFT. In the process, just under half of the owners opted for the digital version. The physical counterparts of the nearly 5,000 owners who preferred the NFT will be burned by Hirst by the end of October.
Damien Hirst begins burning the physical counterparts of his NFT art collection “The Currency” at Newport Street Gallery.
Virtual real estate in the form of land in digital worlds is part of the metaverse. The sector is developing into a new sub-asset class in the field of digital assets and thus into a billion-dollar market with high potential. Similar to real estate, owners of virtual properties can build on them, use, sell, or rent them out. However, so-called digital real estate is still difficult for a large part of our society to grasp. The Blockchain Research Lab provides an insight into the digital real estate market.
Digital real estate is increasingly gaining relevance. A study of Metaverse land in the largest NFT game “The Sandbox”.
Among central banks, digital central bank currencies (CBDCs) are regarded as a new set of instruments that can be used to massively expand the current control options of monetary authorities. Accordingly, concepts for the digital issuance of cash are being evaluated at the global level. In a recent report, India’s central bank (RBI) also introduces the concept of a digital rupee and discusses its design, issuance and impact on the banking system.
The Reserve Bank of India presents its concept of a CBDC rupee, considering its design, issuance, and effects on the current banking system.
