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Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

October 8, 2019 |

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Sberbank, the largest bank in Russia with a regional and global presence, has suffered a major data breach. Personal information belonging to millions of clients is now being sold on the black market. Initial analyses suggest the trove of data for sale is real, highlighting the risks associated with traditional banking.

Also read: Turkish Government Freezes Over 3 Million Bank Accounts

Personal Information Put Up for Sale

The leak at Sberbank, a leading financial services provider with offices in 21 countries including other CIS members, the U.S., U.K., Central and Eastern Europe, may be the largest to date in the history of the Russian banking sector. The blow against its reputation comes after the industry experienced a similar attack earlier this year in which three other Russian banks were targeted.

The unknown new owners of the database, containing details for 60 million credit cards, are now selling the information online. An ad appeared this past weekend on a forum banned by the federal telecom watchdog, Roskomnadzor. Kommersant, the leading Russian business daily which broke the news, quotes digital security experts who believe the information is real, although not all of it may be current.

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Potential buyers of the data lot have been offered a sample of entries. According to the publication, whose authors have examined the set, it contains the data of 200 clients from different Russian cities, served by Sberbank’s Ural branch. The tables provide the details of the account holders, their bank cards and associated transactions.

The date stated on the document is Aug. 4, 2019, possibly the day the leak took place. It also features the phrase “way4” and the abbreviation “w4.” The savings bank has been using a data processing platform called Way4 for around a decade. Sberbank confirmed the leak in a press release and revealed an internal investigation has been launched. The bank has not been able to identify any external cyberattacks and the main assumption at the moment points to “deliberate criminal actions of an employee.”

The Russian lender is currently checking the authenticity of the leaked information to confirm whether it is genuine. Sberbank representatives assured the public the funds stored in the leaked bank card accounts are not in danger of being misappropriated by parties unauthorized by its customers. The stolen information does not contain the CVV numbers of the cards and there’s also two-factor authentication via SMS for each transaction.

Leaked Data Is Real, Independent Checks Confirm

Ashot Oganesyan, founder of data leak prevention software provider Devicelock, claims his company has analyzed the released sample and been able to confirm it contains the personal data of real people. Trying to establish the truth for themselves, Kommersant journalists have attempted to find their own info in the database and the sellers provided them with the details of their own credit cards, including information about former employers.

According to their website, Sberbank now provides services to over 150 million clients worldwide. In Russia alone, the bank has around 92 million active retail customers and over 2.4 million corporate clients. The number of Sberbank’s active credit cards in the country is currently around 18 million. The database that’s on sale has been divided into 11 sets which corresponds to the number of the bank’s territorial branches.

Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts

Sberbank’s clients are only the latest victims of bank information theft in the Russian Federation. This past summer, 900,000 customers of OTP Bank, Alpha Bank, and HCF Bank had their names, phone numbers, passport details and employment information exposed. Among them were the personal details of 500 police officers and even 40 agents of the Federal Security Service (FSB).

Cases such as these, which are not an isolated Eastern European phenomenon, demonstrate the risks associated with the widely adopted banking sector practice of collecting detailed personal information, also known as know-your-customer (KYC) procedures. The data is usually stored in a centralized manner that increases its vulnerability to attacks targeting a bank’s systems.

With cryptocurrencies you are free to transact in a decentralized and private manner. The model introduced by Bitcoin does not require a trusted third party providing intermediary services. If you need to buy or sell coins such as bitcoin cash (BCH) and other major digital currencies you can do so on a peer-to-peer platform like local.Bitcoin.com.

What are your thoughts about the latest major credit card breach? Share your opinion on the subject in the comments section below.


Images courtesy of Shutterstock.


Do you need a reliable bitcoin mobile wallet to send, receive, and store your coins? Download one for free from us and then head to our Purchase Bitcoin page where you can quickly buy bitcoin with a credit card.

The post Why Bitcoin Is Better Than Banks: Major Credit Card Breach Exposes 60M Accounts appeared first on Bitcoin News.

Bitcoin News

Trump Pressures Fed for More Rate Cuts as Mega Banks Drain the Balance Sheet

October 2, 2019 |

Trump Pressures Fed for More Rate Cuts as Mega-Banks Drain the Balance Sheet

U.S. President Donald Trump is pressuring the central bank to cut interest rates even further as a spike in oil prices has offset the Federal Reserve’s ‘normalization’ tactics like rate-cutting and overnight repos. Additionally, the mega bank JP Morgan Chase (JPM) is being blamed for the lack of liquidity in the repo market’s cash reserves, as JPM’s recent reduction move accounted for a third of the Fed’s bank reserves for Q3.

Also Read: Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed

Trump Calls the Fed’s Easing Tactics “Pathetic”

Central banks are in a state of panic. No matter what they do, the economy is not being guided well by their easing tactics. In the last few months, at least 19 central banks have started participating in monetary easing practices in order to combat what’s called “stagflation.” The term refers to a period of slow economic growth combined with rising prices across products and services worldwide. The U.S. Federal Reserve has just started cutting rates and conducted spot repo operations to stimulate the economy. President Donald Trump has been pressuring Fed Chairman Jerome Powell and the central bank’s board members to cut rates even further. The Fed has already printed $ 128 billion in mid-September and added another $ 63 billion in collateral on the Q4 balance sheet last minute.

Trump Pressures Fed for More Rate Cuts as Mega-Banks Drain the Balance Sheet
Jerome “Jay” Powell, the 16th and current Chair of the Federal Reserve (left) and U.S. President Donald Trump. On September 11, Trump said: The Federal Reserve should get our interest rates down to zero, or less, and we should then start to refinance our debt. Interest cost could be brought way down, while at the same time substantially lengthening the term. We have a great currency, power, and balance sheet.”

Trump says the prior rate cuts have not helped the U.S. dollar regain strength and he wants the Fed to chop rates as soon as possible. “As I predicted, Jay Powell and the Federal Reserve have allowed the dollar to get so strong, especially relative to all other currencies, that our manufacturers are being negatively affected,” Trump tweeted on October 2. “[The] Fed rate is too high — They are their own worst enemies, they don’t have a clue — pathetic.”

However, not everyone agreed with Trump and the well known gold investor and economist Peter Schiff told Trump he was wrong. “You’re the one who’s pathetic,” Schiff replied. “The U.S. dollar index was slightly higher on the day you took office than it is today — Your trade policies and the growth of government spending and deficits that you support are hurting manufacturing — The Fed actually did more damage under Obama,” Schiff added. However, Trump is in full support of his trade war, the current monetary easing tactics, rate cuts, overnight repos, and he seems to want a lot more. Trump emphasized last month that “the U.S. should always be paying the lowest rate.”

Trump Pressures Fed for More Rate Cuts as Mega-Banks Drain the Balance Sheet
Many pundits like Schiff and other economists blame Trump’s trade war with China for the economy’s problems.

The pressure from Donald Trump has many economists thinking that more rate cuts will be implemented in October. For instance, CME Group’s Fed Watch tool shows there’s a 64% chance that the Fed will cut rates by another quarter-point during the October Federal Open Market Committee (FOMC) meeting. CME’s tool uses the futures market prices in order to determine how the economy is doing. A good example of CME’s metrics in use is the U.S. manufacturing purchasing managers’ index, which dropped to a low of 47% last month. The manufacturing index has not dropped that low since 2009 after the financial crisis was in full swing. However, these days financial experts don’t think the Fed’s small rate cuts will even help and many believe Trump’s trade war with China is the main issue. U.S. rates strategist at BMO Capital Markets Jon Hill blames the trade war. “Clearly the trade war and strong dollar continue to weigh on domestic goods producers,” Hill explained in a note to investors on Tuesday. “Given this, one has to wonder how impactful incrementally lower rates may or may not be.”

Trump Pressures Fed for More Rate Cuts as Mega-Banks Drain the Balance Sheet
Trump’s Trade War Timeline according to the Peterson Institute for International Economics (PIIE).

Mega Banks Like JP Morgan and Bank of America Are Becoming Too Big to Lend

In addition to the theatrics between Trump and the FOMC board members, JP Morgan Chase (JPM) is being scrutinized for creating a massive repo market spike. Researchers have attributed JPM’s $ 2.7 trillion balance sheet to the jump in repo operations in mid-September and repurchase agreements jumped as high as 10%. Before the Fed’s overnight repos, publicly filed data shows that JPM removed a great portion of cash on deposit held by the Fed by 57%. Reuters reports that the demand for overnight Fed-induced cash exceeded the supply on September 17. JPM wasn’t the only culprit as another mega financial giant Bank of America (BoA) and its $ 2.4 trillion balance dropped 30% ($ 29 billion) of its deposits. An unnamed executive at a competing bank said the recent reductions were a “very big move” and “massive.”

Trump Pressures Fed for More Rate Cuts as Mega-Banks Drain the Balance Sheet
Bankers and Wall Street analysts blame mega banks like JPM and BoA for the cash crunch because they reduced reserves a great deal prior to the overnight repos in September.

Fed watchers and economists say that the crunch for cash has hurt the Fed because the central bank was depending mainly on its bond portfolio. The sluggish economy has made smaller financial institutions and corporations feel the need to obtain more cash reserves. As CME’s Fed Watch tool and the recent tweets stemming from Trump show, there’s definitely a chance the Fed and FOMC governors will slash rates again this month. Alongside this with JPM, BoA, and other incumbents reducing deposits considerably, the Fed will likely fire up the printing press to ease the demand pressure.

What do you think about the central banks’ extreme measures and ideas to help save the economy? Do you think cryptocurrency will help the situation? What do you think about Donald Trump pressuring the Fed? Let us know in the comments section below.


Image credits: Shutterstock, Dan Burns Reuters, FRED, and Pixabay.


Did you know you can buy and sell BCH privately using our noncustodial, peer-to-peer Local Bitcoin Cash trading platform? The Local.Bitcoin.com marketplace has thousands of participants from all around the world trading BCH right now. And if you need a bitcoin wallet to securely store your coins, you can download one from us here.

The post Trump Pressures Fed for More Rate Cuts as Mega Banks Drain the Balance Sheet appeared first on Bitcoin News.

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Public banks can be formed in California as Newsom signs new law

October 2, 2019 |

California is the second U.S. state to let cities and counties establish public banks, which can lend out public funds at low interest rates.


L.A. Times – Business

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

October 1, 2019 |

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

In the last 48 hours, digital currency markets have rebounded after some bearish price dips last week. After losing $ 35 billion in a short period of time, most crypto markets have been gradually healing and the overall market valuation of the cryptoconomy has clawed back at least 50-60% of the losses.

Also Read: Money and Democracy: Why You Never Get to Vote on the Most Important Part of Society

Crypto Markets Struggle But See Slight Gains

Cryptocurrencies saw some deep losses last week as the price of BTC dropped to a low of $ 7,600 three days ago. Most of the cryptoconomy has had a strong correlation with BTC’s price movements and the majority of coins followed BTC’s downward path. In the last 48 hours, however, crypto bulls have been chugging along, attempting to bring prices higher again. On October 1, the price of BTC is meandering between $ 8,300-8,400, and at $ 8,367 per coin, BTC is up 1.6%. Still, for the last seven days, BTC is down 11.3% and bulls have some more resistance ahead of them.

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

The second largest market rival is ethereum (ETH) which has gained 0.75% today. One ETH is trading for $ 178 at press time, but markets are still down 5.8% for the week. Ripple (XRP) is currently trading for $ 0.25 per coin and has seen only a small amount of movement in the last few days. Tether (USDT) commands the fourth largest market cap and the stablecoin has held this position all week long. USDT is still the most traded cryptocurrency, capturing $ 19.5 billion in volume on October 1.

Bitcoin Cash (BCH) Market Action

Bitcoin cash (BCH) has held the fifth largest market cap ever since USDT bumped the coin down a spot. At press time, BCH is swapping for $ 223 per coin and is still down 2.2% today and negative 18% for the week. As we mentioned in our last market outlook, BCH took a beating and saw some of last week’s biggest losses. BCH is the sixth most traded digital asset on Tuesday above XRP and below EOS. Bitcoin cash has roughly a $ 4 billion dollar market cap, which is half a billion higher than LTC. Right now there’s been about $ 1.7 billion BCH traded in the last 24 hours. USDT represents 60% of all BCH trades on Monday followed by BCH/USD capturing 16%. Behind the U.S. dollar, the top trading pairs with BCH are BTC (13%), ETH (5.5%), KRW (2.7%), and JPY (0.70%).

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

BCH markets have held above the sub-$ 200 range but there is heavy resistance within $ 250-260. If BCH bulls can muster enough strength to damage that price region then a greater recovery could be on the cards. At press time, order books indicate northbound prices above the $ 270 zone show smoother seas. Cryptocurrency price analyst Pedro Febrero believes a period of consolidation may take hold of BCH markets.

“Last week, I mentioned there could be a chance for more upwards movement following the bounce at $ 200. However, at the time of writing, that now seems highly unlikely until we have worked through a period of consolidation around the new low,” Febrero wrote on October 1. “Currently, Bitcoin Cash is trading well below all its EMAs. Looking at the volume profile, we can clearly see BCH has strong support below $ 200 and almost no resistance until the $ 270-$ 280 level.”

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

Despite the Recent Price Lows, Experts Believe Record Highs Still Incoming for BTC

Despite the recent lows, BTC and other digital assets are on course to start seeing higher prices again according to a few experts. Daniele Mensi, CEO of digital exchange group Nexthash, told the press that the “volatility of cryptocurrencies is what makes them excellent conduits of growth for traders, investors and growing businesses.” “What is important to remember is that bitcoin is still up around 115 percent this year, so its short term peaks and troughs are necessary to facilitate longer-term growth across the currency,” Mensi added. Commodity trader Peter Brandt explained that BTC prices could still drop to the $ 5,500 range, but after that the bull market will initiate and Brandt estimates BTC will touch $ 50K in the long term. John McAfee continues to double down on his bet and he’s still “firm” on his $ 1 million dollars per BTC prediction by the end of 2020.

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

German Bank Predicts BTC Will Touch $ 90K After the Halving

A German financial institution based in Munich recently reported on BTC’s price and upcoming 2020 reward halving. In the spring of 2020, depending on hashrate speeds, BTC’s block reward will cut in half and people believe the price will rise due to this milestone. Germany’s BayernLB bank called BTC a “unique monetary asset” in its recent report and predicts the value of BTC will touch $ 90,000 per coin after the halving. The German bank called the digital asset “hard money” and used the coin’s stock-to-flow ratio as an example of “hardness.”

“It becomes clear that Bitcoin is designed as an ultra-hard type of money,” says BayernLB’s published report called Megatrend Digitalisation. “Next year, it will already exhibit a similarly high degree of hardness as gold. In 2024 (when halving is set to take place again), Bitcoin’s degree of hardness will again increase massively.”

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

Politicians and Bankers Still Forecast a Sluggish Global Economy

Meanwhile, outside the crypto world, the global economy is shaking due to politicians and bankers spreading fears of a massive recession. The New York Times reported on October 1 that “global trade is deteriorating fast, sapping the world’s economy.” Central banks have global economists scared as there’s been a massive shift toward monetary easing tactics and even discussions concerning helicopter money.

Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks

Despite the macroeconomic storms, just like cryptocurrencies, traditional safe haven assets saw losses last week. The price per ounce of fine gold is down on October 1 and trading at $ 1,483 per ounce at press time. No one knows what will happen with markets like precious metals and cryptocurrencies during a great recession, but the way central bankers are acting we may see these assets tested. For now, cryptocurrencies are seeing slight gains but there have been no sure signals that a bullish comeback is imminent.

Where do you see the cryptocurrency markets heading from here? Let us know what you think about this subject in the comments section below.

Disclaimer: Price articles and market updates are intended for informational purposes only and should not to be considered as trading advice. Neither Bitcoin.com nor the author is responsible for any losses or gains, as the ultimate decision to conduct a trade is made by the reader. Always remember that only those in possession of the private keys are in control of the “money.” Cryptocurrency and gold prices referenced in this article were recorded at 12 p.m. Eastern Standard.


Image credits: Shutterstock, Coinlib, Markets.Bitcoin.com, Gold.org, and Pixabay.


Do you need a reliable bitcoin mobile wallet to send, receive, and store your coins? Download one for free from us and then head to our Purchase Bitcoin page where you can quickly buy bitcoin with a credit card.

The post Market Outlook: A Few Cryptocurrencies Rebound While Fear Grips Central Banks appeared first on Bitcoin News.

Bitcoin News

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed

September 30, 2019 |

Central Banks in Panic Mode - Extreme Tactics Like Helicopter Money Discussed

Central banks worldwide continue to inject more stimulus into the economy as they predict the onset of a new financial crisis. In the face of a sluggish economy, monetary easing, negative interest rates, and ‘normalizing’ the balance sheet is the name of the game these days. Now central banks are contemplating even more unconventional methods of monetary policy like helicopter money to save the economy.

Also Read: Money and Democracy: Why You Never Get to Vote on the Most Important Part of Society

Rate Cuts, Negative Yeilding Bonds, Overnight Repos, and Now Helicopter Money

The world’s reserve banks are attempting to guide the economy in hopes that they can steer clear of a financial meltdown. There’s been a domino effect of monetary easing where at least 19 central banks have slashed interest rates, participated in large-scale asset purchases, cut reserve requirement ratios, purchased debt securities, and pumped billions into specific markets. For instance, during the third week of September, in a two-day period, the U.S. Federal Reserve injected roughly $ 128 billion into markets through a repurchase agreement.

This month European Central Bank (ECB) president Mario Draghi revealed the commencement of printing more funds in order to purchase financial assets. The International Monetary Fund’s Christine Lagarde will take Draghi’s role as the ECB’s president on November 1. According to reports, Lagarde, Draghi and other ECB members discussed unorthodox methods of monetary policy like the macroeconomic concept Modern Money Theory (MMT) and helicopter money.

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed
Central banks are in panic mode initiating easing practices like negative interest rates, overnight repos, and now they are discussing helicopter money and MMT.

Helicopter money or direct financing is a form of monetary policy that starts when central banks transfer money directly to the private sector and even taxpayers. Essentially, the process can be a direct distribution of funds into the economy and some have called the idea a citizens’ dividend. Years ago helicopter money was considered a last resort type of scheme and was deemed worse than quantitative easing.

In 2016, the leading global bond investor PIMCO wrote that since the 18th century there were approximately 57 types of helicopter money situations implemented up until 2007 and “all had dire economic consequences.” A decade later, however, ideas like MMT, basic income, and helicopter money financing have been seen in a positive light by certain groups of individuals. MMT is a controversial, hybrid Keynesian concept that promotes the idea that government can print as much as it wants while also offering tax cuts or direct financing to special interest groups at the same time.

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed
Helicopter money is a form of printing funds for direct distribution.

Deutsche Bank: Direct Distribution Could Be Highly Effective if Properly Deployed

In June 2016, the Bank of Japan (BoJ) contemplated using helicopter money to stimulate the economy. According to reports at the time, the Japanese central bank considered dropping sub-$ 100 payments to low-income residents. A month later the BoJ decided not to use the helicopter money approach but did approve a $ 274 billion stimulus package instead. In 2016 Japan would have become the first modern economy to print money for direct distribution. “I think helicopter money remains off the table for now,” Mizuho Financial Group’s (MHFG) senior economist Colin Asher told the press at the time. Fast forward to today, and bankers and economists are starting to believe that ideas like helicopter money and MMT are innovative economic concepts.

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed
Deutsche Bank says central banks will “explore more unconventional policies” in the near future.

Deutsche Bank’s recent report has argued for helicopter money and the financial institution says because the economy is so bleak, central banks are planning to “explore more unconventional policies.” Deutsche Bank thinks that traditional methods of monetary easing are not enough, and central banks will need more stimulus in their arsenal. The recent report emphasizes that central planners using direct distribution methods could spur more consumerism and spending. “[Helicopter money] could be highly effective if properly deployed,” Deutsche Bank pointed out.

The Fed: Current Easing Is “Organic” – Don’t Call It QE4

There are many signs showing that bankers and central planners are unnerved and panicking over the looming recession. However, the central banks themselves are to blame for the mess they have caused as there’s roughly $ 15 trillion in negative-yielding sovereign and corporate debt worldwide. The yield below zero percent interest has scared the daylights out of economists who believe negative yields never equate to strong monetary policy.

In September, the Federal Reserve started its easing program last minute when it cut rates for the first time in 10 years. Not all the Federal Reserve board members agreed with the easing policy, and the first quarter-point reduction was voted in by a 7-3 vote. Fed Chairman Jerome Powell explained that the voting committee’s dissent was healthy to the central bank’s planning process. After printing $ 128 billion, Powell asked the press not to call the process the fourth round of quantitative easing, or QE4. Unlike prior QE schemes, Powell said the current procedure is an “organic” approach.

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed
Chairman Jerome Powell and the Fed have said the recent stimulus is not QE4 or the fourth round of QE, but merely an “organic” process.

Besides discussions about helicopter money, central banks like the Federal Reserve inject fiat into the system by purchasing Treasury securities from specific agents within a repo. The Federal Reserve Bank recently conducted a few spot repo operations, which provides smaller banks with the opportunity to trade Treasuries and other forms of securities for cash advances. The concept is just another form of the ‘trickle-down economics’ and proponents of the scheme believe the cash helps fund the repo dealers. The repo agents are then supposed to distribute the funds throughout certain sectors of the financial sector. During the start of Q4 2019, the New York-based Fed revealed an overnight repo operation where dealers introduced more than $ 63 billion in collateral.

Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed

A liquidity crunch, slow economic growth, and inflation are the main reasons why the central bankers are scrambling to fix the problem they see growing into a financial crisis. Back in 2008, there were similar methods used during the onset of the economic meltdown where short-term yields were extremely volatile, and banks started participating in overnight repurchase programs. The Fed and many other banks have already started conducting overnight repurchase operations. Once again, central banks think printing stimulus and bailouts are the only way to help the situation.

What do you think about the central banks’ extreme measures and ideas of using helicopter money to save the economy? Do you think cryptocurrency will help the situation? Let us know in the comments section below.


Image credits: Shutterstock, The Federal Reserve, Deutsche Bank, Zerohedge, and Pixabay.


Did you know you can buy and sell BCH privately using our noncustodial, peer-to-peer Local Bitcoin Cash trading platform? The Local.Bitcoin.com marketplace has thousands of participants from all around the world trading BCH right now. And if you need a bitcoin wallet to securely store your coins, you can download one from us here.

The post Central Banks in Panic Mode – Extreme Tactics Like Helicopter Money Discussed appeared first on Bitcoin News.

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Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

September 30, 2019 |

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

Banks are laying off workers across the globe as revenue declines throughout the sector. According to reports, banks have announced nearly 60,000 job cuts so far this year, with most of the layoffs happening in Europe, especially in Germany.

Also read: Panic at 137 Bank Branches as RBI Limits Withdrawals to ₹1,000

Almost 60,000 Job Cuts

Bank employees are being laid off worldwide. Negative interest rates, political uncertainty and threats of trade wars on a global level have all played their part in eroding banks’ balance sheets, along with interest rate cuts which further reduce margins.

According to year-to-date company filings and labor union disclosures compiled by Bloomberg, banks have announced that they are cutting 58,200 jobs so far this year. The biggest layoffs are in Europe, where 52,424 jobs, or 90% of the total layoffs, are being slashed, as the European banking sector continues to struggle with profitability. Moreover, 2,769 workers in North America are being let go, as are 2,487 in the Middle East and Africa and 513 in the Asia Pacific region.

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide
Global layoff breakdown. Source: company filings, labor union disclosures, and Bloomberg.

Furthermore, the data shows ten banks that have laid off the most workers in Europe, with Deutsche Bank leading the pack with 18,000 job cuts. The other banks on the top 10 list are Banco Santander, Commerzbank, HSBC, Barclays, Alfa Bank, KBC, Societe Generale, Caixabank, and the National Bank of Greece.

German Banks Lag Behind Others

The health of Germany’s financial sector has been a top concern for regulators and politicians for quite some time. The low interest rate environment, a global economic slowdown, trade tensions, geopolitical uncertainty, added to structural vulnerability and domestic economic weakness, have negatively impacted German banks. Lenders in Europe’s largest economy sit on large deposits so they are more dependent on lending than those in many other European countries.

The European banking sector has long faced calls for consolidation as banks struggle to generate profits. Two leading German banks — Deutsche Bank and Commerzbank — have attempted a merger, but it fell through early this year, resulting in the pair independently announcing major layoffs.

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

At the top of the downsize list is Deutsche Bank, which began laying off 18,000 workers in July as part of an $ 8.3 billion overhaul. According to reports, Germany’s largest bank plans to exit its equities sales and trading business as well as its fixed-income business, but will retain a small equity capital markets business. The bank had 91,737 employees at the end of 2018, almost 6,000 fewer than the previous year. The layoffs would shrink its workforce to roughly 74,000 employees by 2022. Deutsche Bank is also dealing with German authorities probing for information about the relation of its Frankfurt headquarters to Danske Bank, which is currently at the center of a massive money-laundering scandal.

Domestic rival Commerzbank, with about 1,000 branches and offices in almost 50 countries, is also downsizing. The German government is a major shareholder of this bank. Commerzbank announced last week a plan to lay off 4,300 of its 49,000 employees in some areas, but will add 2,000 jobs in “strategic areas.” A fifth of its branches will also be closed down in a strategy overhaul.

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

Layoffs Happening Worldwide

Other European and global banks have made similar announcements. “The main factors that could substantially impede European economic sentiment and growth remain the risk of further economic de-globalization, including an escalation of trade conflicts, Brexit and political turmoil in some euro area countries,” KBC Group detailed in its second-quarter earnings presentation for analysts. The bank-insurance group employs 42,000 people, has 1,389 bank branches, and operates primarily in Belgium, the Czech Republic, Slovakia, Hungary, Bulgaria and Ireland. The group also announced this month that its Belgian workforce will be reduced by 1,400 in three years.

Banking giant HSBC is also downsizing. Following the stepping down of former CEO John Flint after being on the job for only 18 months, the bank announced in August that it will cut 4,700 jobs. CFO Ewen Stevenson said up to 2% of the bank’s workforce will go. HSBC group employes 237,685 as of June 30.

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

British multinational bank Barclays already cut 3,000 jobs in the second quarter, CEO Jes Staley and CFO Tushar Morzaria confirmed on an earnings call in August. At the end of last year, the group employed 83,500 staff, according to its annual report.

Spain’s largest bank, Banco Santander, agreed with unions in June to lay off 3,223 workers in Spain as part of the bank’s effort to integrate Banco Popular, a financial services conglomerate with 1,600 branches across Spain. At the end of March, Santander had 32,366 employees and 4,366 branches in Spain. Earlier this year, the bank said it will close 140 branches in the U.K., putting more than 1,200 jobs at risk. Another Spanish bank, Caixabank, announced in January a layoff of 2,157 employees, cutting 7.3% of its total workforce. The largest Catalan bank also plans to close down over 800 branches in Spain out of its 4,461 branches in operation by 2021.

Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide

One of the largest privately owned banks in Russia, Alfa Bank, is also reducing its workforce. The bank currently employs more than 24,000 workers. CEO Vladimir Verkhoshinsky reportedly said that 3,000 employees, or 12% of the bank’s workforce, will be laid off by the end of the year. This number adds to the 2,000 workers who left the bank during the first quarter. According to reports, the layoffs are mainly due to the bank’s decision to migrate from providing loans in brick-and-mortar stores to offering them online.

France’s third-largest bank, Societe Generale, has also revealed its plans to cut 1,600 jobs, mainly at its corporate and investment banking arm. The bank, which employs 18,000 people in 30 countries, also said in April that it would cut 750 jobs in France.

Other banks that are downsizing include Citigroup, which revealed in July its plans to lay off hundreds of people. BNP Paribas reached an agreement with unions in March to cut as many as 2,500 jobs at its Belgian retail banking unit by 2021. The bank employs 13,000 people in Belgium. Further, the data compiled by Bloomberg shows that the National Bank of Greece is laying off 1,700 workers.

What do you think of banks’ massive layoffs? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


Images courtesy of Shutterstock and Bloomberg.


Did you know you can buy and sell BCH privately using our noncustodial, peer-to-peer Local Bitcoin Cash trading platform? The Local.Bitcoin.com marketplace has thousands of participants from all around the world trading BCH right now. And if you need a bitcoin wallet to securely store your coins, you can download one from us here.

The post Massive Layoffs: Banks Cutting Nearly 60,000 Jobs Worldwide appeared first on Bitcoin News.

Bitcoin News

Protests Led RBI to Raise Bank’s Withdrawal Limit

September 27, 2019 |

Protests Led RBI to Raise Bank's Withdrawal Limit

Heavy protests by bank customers have led the Reserve Bank of India to modify its original restrictions placed on a cooperative bank with 137 branches across India. The central bank had limited customer withdrawals to only 1,000 rupees (approximately $ 14) per account for six months.

Also read: Panic at 137 Bank Branches as RBI Limits Withdrawals to ₹1,000

Relaxing Withdrawal Limit

India’s central bank has issued another circular regarding Mumbai-based Punjab and Maharashtra Cooperative Bank (PMC Bank) Ltd. The first one, dated Sept. 24, puts PMC Bank under regulatory restrictions, including limiting customer withdrawal limit to 1,000 rupees (~$ 14) per account for six months. As customers protested heavily at PBC Bank branches, the RBI responded by issuing a follow-up circular to relax the imposed withdrawal limit. The new RBI circular, dated Sept. 26, states that the central bank “has decided, in the interest of depositors, to review the directions,” elaborating:

It has been decided to allow the depositors to withdraw a sum not exceeding ₹10,000/- (rupees ten thousand only) (including ₹1,000/- wherever already withdrawn) of the total balance.

Protests Led RBI to Raise Bank's Withdrawal Limit
Customers protesting at a PMC Bank branch. Image credit: Newsband India.

The total balance in question is one “held in every savings bank account or current account or any other deposit account by whatever name called, subject to conditions stipulated in the RBI Directive dated September 23, 2019,” the RBI clarified. “Other terms and conditions of said directive shall remain unchanged,” including granting or renewing any loans and advances, making investments, and incurring any liabilities including borrowing funds or accepting new deposits, the central bank noted.

The RBI cited “major financial irregularities, failure of internal control and systems of the bank and wrong/under-reporting of its exposures under various off-site Surveillance reports” as the reasons for putting PMC Bank under regulatory restrictions, NDTV reported.

RBI Says It Wants to Reduce Hardship

The move by the central bank to limit withdrawals to only 1,000 rupees (~$ 14) led to multiple protests by customers and long queues outside of PMC Bank branches. According to local media, the bank currently has 137 branches in multiple states across India. In its circular, the central bank stated that “With the above relaxation, more than 60% of the depositors of the bank will be able to withdraw their entire account balance,” adding:

The above relaxation has been granted with a view to reducing the hardship of the depositors.

PMC Bank customers are reportedly worried about their life savings. “My money is gone now,” one customer told NDTV, convinced that he would not be able to access his savings. He was not alone, as thousands of customers stood outside various branches, demanding answers about their life savings, the news outlet detailed. “We need money urgently for the medical surgery of my mother-in-law and we can’t withdraw our own money,” one customer exclaimed.

Protests Led RBI to Raise Bank's Withdrawal Limit
Customers demanding answers at PMC Bank. Image credit: DNA India.

According to the news outlet, over two dozen of cooperative banks are now under RBI administration, but PMC Bank is by far the largest one to receive such restrictions. The bank had deposits of Rs. 11,617 crore (~$ 127 billion) as of March 31.

Joy Thomas, Managing Director of PMC Bank, attempted to reassure customers, stating that “All efforts are being made to remove the restrictions by rectifying the irregularities … As the M.D. of the bank, I take the responsibility and assure all the depositors that these irregularities will be rectified before the expiry of six months.” Sonia Malik, a branch manager at a PMC Bank in Delhi, said that the bank’s employees were worried about their jobs, adding that “Our staff has worked hard to win the confidence of clients over the years. After this incident, it’ll be very difficult to revive that confidence.”

The central bank has also placed banking restrictions on all banks, prohibiting them from providing services to crypto businesses. The ban went into effect in July last year, causing a number of crypto businesses to shut down. A number of industry stakeholders have filed writ petitions with the country’s supreme court to challenge the RBI ban. After repeated delays, the court is scheduled to resume hearing this week.

What do you think of the RBI’s attempt to alleviate the situation for customers of PMC Bank? Will 10,000 rupees be enough? Let us know in the comments section below.

Disclaimer: This article is for informational purposes only. It is not an offer or solicitation of an offer to buy or sell, or as a recommendation, endorsement, or sponsorship of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.


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Swiss Banks Team With Fintechs to Enter the Crypto Space

September 25, 2019 |

Swiss Banks Team With Fintechs to Enter the Crypto Space

Multiple joint projects between banks and crypto companies based in Switzerland now offer customers the opportunity to invest in digital assets and take advantage of banking services related to cryptocurrencies. It’s all happening in a regulated environment, generally friendly towards the growing crypto industry. The latest partnership between a traditional institution and a fintech startup aims to provide wealthy clients with access to major cryptocurrencies.

Also read: Buying Bitcoin on the Street Is Getting Easier

Switzerland to Become the World’s Crypto Bank

Switzerland, which has long ago established itself as the world’s bank, has had its image tarnished a little bit in the past couple of decades. The Alpine federation gave up some ground under international pressure, mostly from the United States and the European Union, to lower the level of banking secrecy and raise taxes to match the rates in neighboring jurisdictions.

But cryptocurrencies now offer the Swiss a chance to redeem themselves to a certain extent and also restore some of their positions in the banking field, in an alternative but very promising sector. Swiss banks, one after the other, are taking this new opportunity. The latest entry in what has become a long list is Arab Bank (Switzerland) Ltd., a member of the Jordanian Arab Bank Group.

Swiss Banks Team With Fintechs to Enter the Crypto Space

The subsidiary is based in Zug, the very center of the Swiss crypto valley. Over 750 crypto businesses from around the world have established presence in the valley, which has already spread over to other cantons and neighboring Liechtenstein. Arab Bank’s Swiss entity recently joined forces with the blockchain technology firm Taurus to provide its customers with access to cryptocurrencies.

The partners intend to launch a range of services related to digital assets, Swissinfo reported. These include custody and brokerage for holdings in the two largest coins by market capitalization, bitcoin core and ethereum. The services will be based on the crypto company’s “Taurus Protect” storage platform designed to provide banks, exchanges and asset managers with institutional-grade vault services for digital assets.

Commenting on the announcement, Arab Bank Switzerland CEO Serge Robin shared his belief that blockchain technology will disrupt the financial industry as it is known today. “We intend to be amongst the first banks to offer digital asset services to our clients in a secure and regulated environment,” the executive emphasized.

The bank has embarked on the project in response to demand from some of its wealthy clients who wished to add cryptocurrencies to their investment portfolios. So far, many traditional financial institutions have refrained from offering products related to decentralized money, fearing regulations that oblige them to freeze serious amounts of reserve capital.

Swiss Banks Team With Fintechs to Enter the Crypto Space

Crypto Startups Enter the Equation

That’s where young crypto companies become part of the solution, providing services to a bank’s clients that are safely separated from its main activity. Also, smaller banks around the world have been more willing to engage with the crypto space in a bid to reap the benefits of being the first to establish a foothold in this rapidly developing market.

Other Swiss banks have already blazed a trail where Arab Bank is now heading. Bank Vontobel is also in a partnership agreement with Taurus. The two are running a platform called Digital Asset Vault which institutional investors can use to store and trade cryptocurrencies outside their balance sheets. The service is offered to clients who don’t want to deal with the technical side of owning coins.

A similar service was announced this year by Gazprombank (Switzerland) Ltd., the local subsidiary of Russian state-owned giant Gazprombank. Its digital asset management product is offered in cooperation with two fintech companies, Avaloq and Metaco. It is based on Metaco’s crypto asset custodial solution called Silo.

Also in 2019, the year that saw a revival of investors’ interest towards digital assets, one of the largest financial institutions in Switzerland, 125-year-old private bank Julius Baer, revealed it’s entering the market via a partnership with crypto banking startup Seba Crypto AG. The latter, together with another banking solutions provider in the space, Sygnum AG, was recently granted banking and securities dealer’s licenses by the Swiss Financial Market Supervisory Authority, as news.Bitcoin.com reported.

Swiss Banks Team With Fintechs to Enter the Crypto Space

Alternative Sources of Revenue

The need to find alternative revenue sources also pushed another Swiss bank to seek new opportunities in the cryptocurrency market. Last year, it became clear that Maerki Baumann was interested in providing services to participants in the nascent industry. This past summer, CEO Stephan Zwahlen shared the bank’s “ambition to be the go-to private bank in the Swiss crypto arena.” But it already has competition – Hypothekarbank Lenzburg, 150-year-old legacy bank, has been opening accounts for crypto businesses since last year.

Several other banks and fintech entities in Switzerland offer services related to crypto investment, trading, and digital asset storage. Falcon private bank and digital trading platform Swissquote have found partners in the crypto industry to provide clients with custodial solutions and facilitate their participation in crowdfunding through the issuance of tokens. Bank Zarattini has teamed up with Inacta, a crypto-financial services provider, to extend similar services.

Crypto banking doesn’t necessarily have to involve traditional financial institutions, however. A partnership between two leading crypto companies, Bitcoin.com and Cred, allows customers to earn interest on their holdings. The rates are much higher than those in the fiat world – up to 6% on bitcoin cash (BCH) and 10% on bitcoin core (BTC) invested with the Credearn product.

And if you are new to the crypto space, you can safely and securely purchase bitcoin cash (BCH) and other major cryptocurrencies at buy.Bitcoin.com using a credit card. You can also trade your crypto assets on our noncustodial, peer-to-peer marketplace local.Bitcoin.com, which already has thousands of users around the world, and try our recently launched premier trading platform, exchange.Bitcoin.com.

Do you expect more Swiss banks to enter the crypto market in the near future? Tell us in the comments section below.


Images courtesy of Shutterstock.


Do you need a reliable bitcoin mobile wallet to send, receive, and store your coins? Download one for free from us and then head to our Purchase Bitcoin page where you can quickly buy bitcoin with a credit card.

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At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows

September 15, 2019 |

More Than 18 Central Banks Give Way to Monetary Easing As Economy Slows

In a coordinated fashion, more than 18 central banks worldwide have or plan to cut interest rates, sparking a domino effect of monetary easing. It’s been 10 years since the world has seen central planners orchestrate such harmonization in an attempt to save the economy from a deep recession.

Also Read: Money and Democracy: Why You Never Get to Vote on the Most Important Part of Society

A Large Number of Central Banks Slash Interest Rates

Economists have been saying for a while now that the global economy is headed for a severe wakeup call that could be worse than 2008’s financial crisis. The news started heating up at the beginning of 2019 and more than half of U.S. economists from the National Association for Business Economics (NABE) said they believe an economic downturn is coming by 2020. Financial forecasters think in the midst of a macroeconomic storm from elections, trade wars between the U.S. and China, and a no-deal Brexit that it’s only a matter of time. Tumultuous geopolitical events have caused the world’s central banks to awaken from their slumber and start slashing interest rates. As the end of the year draws near, many central banks have started a rate cut frenzy.

Usually, when the economy is consistent and considered ‘strong,’ central banks keep interest rates higher. On the other hand, when the economy doesn’t look so hot, central banks cut rates so smaller financial institutions can borrow at a better rate. The concept is derived from Keynesian economics, the economic theory of total spending in order to stave off inflation. The goal of interest rate cuts is so the smaller hive of banks below the central banks can give the savings from better rates to consumers. However, instead of trickling down to the people, the excesses usually stay with the wealthy. While keeping the hard assets to themselves, the banking cartel also starts to lend at an alarming rate. They don’t care if individuals and organizations don’t pay up and they know they will have to deal with delinquencies and foreclosures. At the end of the day, all those issues just give the bankers another way to pillage hard assets like homes, land, boats, cars, and anything people can’t afford. Unfortunately, this cycle continues every few decades and generations who haven’t even been born yet are left with more debt.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows

Traditionally when central banks cut rates en masse it is a warning sign that the economy is likely headed for troubling times. In the past, people have always hedged their savings by using safe haven assets like gold to escape the wrath of rapid inflation and fiat currency devaluation. Nowadays, precious metals and cryptocurrencies are both benefiting from the doom and gloom financial forecasts. The following is a look at central banks that are currently planning for monetary easing and stimulus packages or have already approved financial inducement and slashed interest rates.

Japan

The Bank of Japan (BOJ) has an accommodative stance toward monetary easing these days. In July, BOJ Governor Haruhiko Kuroda explained to the press that he was positive about keeping long-term interest rates at 0% and short-term rates to -0.1%. When negative rates were first introduced in Japan in 2016, the move was considered shocking. The following month, after the Federal Reserve cut rates this year, Deputy Governor Masayoshi Amamiya said the BOJ was also fully prepared to offer more easing. One of the central bank’s board members also mentioned that Japan’s banks might start charging fees for savings accounts as well. This September, the BOJ is considering deep negative interest rate cuts to respond to global risks facing the economy.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
BOJ Governor Haruhiko Kuroda.

The U.S.

The Federal Reserve has already cut the U.S. interest rate by a quarter-point in July hoping to spur more lending and spending. When the Federal Open Market Committee and Fed Chair Jerome Powell sliced the rate for the first time since the 2008 financial crisis, the group noted economic “uncertainties” remain. Now reports detail that Fed officials will lower rates by another quarter-point by the end of September. U.S. President Donald Trump has encouraged the Fed to cut rates even lower. “The Federal Reserve should get our interest rates down to zero, or less, and we should then start to refinance our debt,” Trump declared on September 11 on Twitter. “Interest cost could be brought way down, while at the same time substantially lengthening the term — We have the great currency, power, and balance sheet.”

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
During a conversation with Thomas Jordan, Chairman of the Swiss National Bank, on September 6, the Fed’s Jerome Powell said: “We are not forecasting or expecting a recession.”

Europe

On Thursday, September 12, the European Central Bank (ECB) approved a new stimulus package and cut interest rates. Just like the BOJ and the Fed, members of the ECB are afraid of “worrisome inflation.” According to the ECB, the deposit rate dropped from -0.4% to -0.5% and this November the bank plans to begin €20 billion a month worth of bond purchases. “The Governing Council expects (bond purchases) to run for as long as necessary to reinforce the accommodative impact of its policy rates, and to end shortly before it starts raising the key ECB interest rates,” the ECB said.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
ECB President Mario Draghi’s growth and inflation projections have been dreary.

China

The economy in China has been floundering according to economists and the country has also been dealing with a trade war with the U.S. China’s People’s Bank of China (PBOC) revealed on September 6 that the bank would cut its reserve requirement ratio by 50 basis points. The PBOC also announced that a few specific banks might be entitled to a ratio reduction of 100 basis points if they qualify. China’s new bank cuts will start on Monday, September 16 and the PBOC claims the cuts will provide roughly 900 billion yuan ($ 126.35 billion) into the Chinese economy. Like Japan, China has an accommodative stance toward monetary easing and this is the third time this year the PBOC has made changes and the seventh time since the financial crisis in 2008.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
The head of the PBOC just got his job last year as China named Yi Gang its first central bank chief in 15 years. Yi Gang is very comfortable with monetary easing tactics.

South Korea

In a surprise move in mid-July, the Bank of Korea (BOK) announced reducing the country’s benchmark interest rates. The BOK also told the press that economists predicted rapid inflation forecasts and slashed the seven-day repurchase rate from 1.75% to 1.5%. “Economic circumstances have deteriorated since April … With the rate cut, we took into account the effects of Japan’s trade restrictions,” BOK governor Lee Ju-Yeol explained during a press conference. Seoul has had conflicts with Japan and just like China and the U.S., the two countries are locked in a trade row.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
“As low growth may continue for a considerable period of time, the Bank of Korea will support economic recovery by maintaining an accommodative monetary policy,” Governor Lee Ju-Yeol has stated in the past.

Russia

The Bank of Russia has been a friend of monetary easing and rate cuts making its third interest rate reduction on September 6. Bank of Russia Governor Elvira Nabiullina and members of the board told the public that “If the situation develops in line with the baseline forecast, the Bank of Russia will consider the necessity of a further key rate reduction at one of the upcoming board of directors’ meetings.” Russia’s benchmark rate was trimmed down to 7% from 7.25%. Russian forecasters believe the inflation rate of 4% could drop to 3% and the Minister of Economic Affairs Maxim Oreshkin believes the bank should continue easing even further.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
Russian President Vladimir Putin with finance minister Maxim Oreshkin. Oreshkin wants deeper interest rate cuts.

India

In August, the Reserve Bank of India (RBI) decreased rates for the fourth time in 2019. The rate cut this summer was the largest since 2010, shaving 35 basis points, and the RBI will now lend to banks at 5.4%. Finance minister Nirmala Sitharaman stood by the rate cut and insisted that a “significant rate cut would do a lot of good for the country.” Members of the RBI and government officials plan to meet this October and the country could see further rate cuts in the near future.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
Finance Minister Nirmala Sitharaman doesn’t have issues with monetary easing and announced yesterday the RBI and the government would fund the real estate and export sector while also offering a ₹10,000 crore special window for unfinished development projects.

Thailand

Central bankers in Thailand are scared inflation is growing out of control and surprised the world on August 8 by cutting repurchase rates from 1.75% to 1.5%. The Bank of Thailand cited slow economic growth, trade wars, and economic uncertainty. The trade war between the U.S. and China was highlighted during the announcement. According to reports, five panel members voted for the cut and two wanted the interest rates to remain unchanged. Two weeks prior to the quarter-point cut, the seven members of the central bank committee unanimously voted to keep the rates untouched.

At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows
(Left to right) Supant Mongkolsuthree, chairman of the Federation of Thai Industries, Predee Daochai, chairman of the Thai Bankers’ Association, and Thai Chamber of Commerce chairman Kalin Sarasin. “Additional measures may be needed to cope with the stronger baht,” Supant Mongkolsuthree said on September 5. “Those measures include imposing a withholding tax, outbound investment promotion and tapering the bond supply. These are ultimately the regulators’ decisions.”

10 More Central Banks Participate in Monetary Easing

All of these banks are just the tip of the iceberg when it comes to the large number of other central banks participating in monetary easing. Other financial institutions include central banks from England, Australia, New Zealand, Brazil, Mexico, Hong Kong, Indonesia, South Africa, Turkey, and the Philippines. Despite decades of poor central planning, these financial institutions retain full power over the monetary system. The people have absolutely no say in how the system is adjusted, tightened and eased.

However, as the years pass, more individuals and organizations are growing tired of the banking cartel’s practices. A great number of people have sought alternatives like cryptocurrencies so they can protect their wealth from the financial system that’s clearly rigged. Individuals who are sick of bailing the banks out and paying for their mistakes believe that at some point the scales will tip. It merely takes enough people to opt out of the monopolized monetary system. At the rate at which people are learning about a new wave of monetary innovation, at some point there will be a mass exodus whether banks and governments like it or not.

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What do you think about the cascade of central banks unveiling rate cuts and monetary easing methods? Do you think the central banks know what they are doing when it comes to monetary policy? Let us know what you think about this subject in the comments section below.


Image credits: Shutterstock, Pixabay, Kim Hong-Ji, Wiki Commons, Fair Use, and Qilai Shen.


Do you need a reliable bitcoin mobile wallet to send, receive, and store your coins? Download one for free from us and then head to our Purchase Bitcoin page where you can quickly buy bitcoin with a credit card.

The post At Least 19 Central Banks Give Way to Monetary Easing As Economy Slows appeared first on Bitcoin News.

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Big Banks Won’t Touch Crypto Clients – But These Smaller Banks Will

September 13, 2019 |

Catering to Crypto Clients, Small Banks Embrace an Opportunity Big Players Are Missing Out On

Cryptocurrencies undoubtedly bring new business opportunities. The expanding industry around digital assets and its customers need more and more services that traditional sectors can provide. Banking is often a bottleneck in the crypto space as most traditional institutions are still reluctant to get their feet wet. Smaller banks, however, are more willing to occupy this niche and reap the rewards.

Also read: Crypto Banking Expands With Positive Interest Rates and New Services

Aiming for a Reward That Justifies the Effort

Navigating the regulatory maze, in the midst of which most crypto companies operate these days, is not easy. Organizations from other industries which work with crypto firms have to deal with the same obstacles. It’s often hard to do business and make a profit. But the current situation also creates opportunities, for there’s a margin to be made in this kind of environment. And it’s usually the small, young and hungry businesses that accept the challenge, hoping that the reward will justify the risks and efforts.

Most big banks have been shying away from the cryptosphere, be it because of the regulatory uncertainty, the volatile nature of the market, or maybe they just see a threat to their good old ways of banking. But small-size financial institutions and representatives of the nascent fintech industry cannot afford to be so shy. In the fast-moving cryptoconomy, every opportunity the growing sector offers is worth exploring and exploiting.

Big Banks Won't Touch Crypto Clients – But These Smaller Banks Will

The case of the German WEG Bank illustrates this very well and shows that banks and crypto companies can cooperate in a mutually beneficial way. In the summer of 2018, as part of a partnership deal, the crypto payment provider Tokenpay Swiss AG acquired a 9.9% stake in the bank with plans to increase its share in the future. And this spring, Nimiq, a provider of browser-based payment solutions, also bought 9.9% in WEG Bank. The two now work on a crypto-fiat product called Nimiq Oasis.

A Bridge Between Two Financial Worlds

WEG Bank is now promoting itself as an institution that bridges the gap between traditional banking and digital currencies. According to an announcement posted on Twitter, it has recently secured “full access to a crypto trading and custody license in Estonia.” The bank noted that it’s also applying for a securities trading and custody license in Germany. The licensed Estonian vehicle, WEG Bank later clarified, is WEG Blocklink OÜ, which is its sister company that will act as a servicer to WEG Bank AG.

Estonia has been a leading force in Europe when it comes to creating a favorable business climate for crypto companies. However, it’s been reported that authorities in Tallinn have started tightening some of the rules applicable to the sector. The new regulations oblige locally registered entities to keep their headquarters in the jurisdiction, while foreign companies are required to maintain an office in the Baltic country.

Fiat Products Backed With Crypto Assets

Having crypto companies among stakeholders is not a mandatory prerequisite to being a crypto-friendly financial institution. Since the launch of its crypto business six years ago, San Diego-headquartered Silvergate Bank has established itself as one of the few banks in the United States that is readily providing services to the digital asset industry. It serves more than 500 entities dealing with cryptocurrencies.

Silvergate has announced its intentions to offer loans collateralized with cryptocurrency. In a filing with the U.S. Securities and Exchange Commission, the lender describes its Silvergate Exchange Network (SEN) and explains that “an exchange client could hold the digital currency collateral, we could use the SEN to initially fund the loan from our balance sheet, and in the event of a collateral deficiency, we could immediately sell the digital currency collateral through our exchange client and use the SEN to bring the resulting funds back to our balance sheet.” Further elaborating, the bank points out:

We believe there may be attractive opportunities to provide digital currency borrowing facilities to deepen our high quality customer relationships and further enhance our interest income.

Other crypto-friendly banks operating in the United States include New York-based Quontic, which is now providing services to crypto companies in its strictly regulated jurisdiction. Elsewhere in the U.S., businesses from the industry can manage their finances with the help of institutions like Simple Bank and Ally Bank. In Europe, corporate and private clients can rely on the banking services provided by a new generation of online and mobile banks such as Revolut, Wirex, Bankera, and Bitwala.

Fintech startups have immensely helped the expansion of crypto banking. Their platforms turn your smartphone into a bank office or a crypto exchange, challenging the traditional understanding of what banks should look like. They are willing to experiment and cater to the needs of crypto businesses and users. In the face of this competition, large financial institutions have yet to integrate digital assets into their business models and strategies.

Big Banks Won't Touch Crypto Clients – But These Smaller Banks Will

Banks working with cryptocurrencies and companies specializing in crypto-related banking are likely to see more regulatory clarity in the future with the adoption of comprehensive national legal frameworks. Along with Estonia, Malta, Gibraltar, and Switzerland form a group of nations where crypto businesses can operate in a friendly regulatory environment. For example, financial authorities in Switzerland recently licensed two companies, SEBA Crypto AG and Sygnum AG, to serve as banking institutions for the country’s growing crypto industry.

And under increasing pressure, old Swiss banks like Zurich-based Maerki Baumann are turning towards the crypto market. “We suddenly had 400 people wanting to talk with us. And they were exactly the kind of people we had been struggling to access for 10 years with traditional private banking offerings,” CEO Stephan Zwahlen told Swissinfo last month. “We found that they were typically between 30 to 40 years old, very well educated and with an entrepreneurial mindset,” he added, speaking about how his bank found an alternative revenue source in the Swiss crypto sector.

Expanding banking services are sure to attract more investors and users. If you are looking to safely and securely enter the crypto space, you can do so by purchasing bitcoin cash (BCH) and other major coins with a credit card at buy.Bitcoin.com. You can also freely trade your cryptocurrencies on our noncustodial, peer-to-peer marketplace local.Bitcoin.com, which already has thousands of users around the world. Also, check out our newly launched premier trading platform exchange.Bitcoin.com. Registered users can access it right now.

Do you expect to see large banks offering services to clients dealing with cryptocurrency in the future? Tell us in the comments section below.


Images courtesy of Shutterstock.


Do you need a reliable bitcoin mobile wallet to send, receive, and store your coins? Download one for free from us and then head to our Purchase Bitcoin page where you can quickly buy bitcoin with a credit card.

The post Big Banks Won’t Touch Crypto Clients – But These Smaller Banks Will appeared first on Bitcoin News.

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