News Briefing - Crowdfunding, SME And Alternative Finance

crowd and crowdfunding

1.UK - FinTech

 

AltFi reports: 


“NorthRow, a software-as-a-service (SaaS) compliance platform, has appointed Adam Holden as its new CEO.  

Founded in 2010, NorthRow helps large and small firms fight against financial crime through its onboarding, ongoing monitoring and remediation solution.  

Holden, who is replacing Adrian Black, who retired from the business in December 2020, joined NorthRow in 2018 as its Chief Financial Officer. Holden has worked across the fintech and traditional financial services industries including at Tandem Bank, Lombard Asset Finance and RBS. 

Holden said: "The highly talented team at NorthRow has made exceptional progress and delivered great results under the direction of Adrian Black. Thanks to Adrian’s leadership and vision we now have a strong foundation on which to deliver an ambitious growth trajectory. We have a clear focus on our product roadmap and increased engagement with our diverse customer base. I'm excited to lead the team on the next stage of its strategic development journey.” 

 

2. UK – FinTech  


Finextra reports: 

 

“Santander has invested €2 million in Connecting Visions, a Spanish startup that helps SMEs gain access to consulting services. 

Connecting Vision acts as a bridge between small firms and experts that can help them with specific challenges. SMEs outline their issue and consultants prepare a series of options that the company can choose between.

The firm has built up an ecosystem of more than 172 service and technology companies, with over 350 experts and advisers with experience in a host of key fields that can help SMEs grow, increase customer loyalty, digitise, become more efficient, and attract talent.” 

 

3. UK – FinTech 

 

TransferWise’s IPO bid has reportedly taken a step in the right direction, with the fintech said to have named Wall Street giants Goldman Sachs and Morgan Stanley as coordinators of its IPO, according to AltFi. 

“The fintech, which is expected to float on the London Stock Exchange later on this year, allegedly appointed the two banks to help it spur on its IPO efforts after reportedly gearing up to float late last year. 

After nearly a decade on the fintech scene, TransferWise has become one of the most well-known and biggest fintechs in the World. 

The fintech processed £42bn worth of cross-currency transfers last year for its eight million customers worldwide and today is handling over £4bn in those transfers every month. 

TransferWise was also one of the first fintechs to turn a profit, marking its fourth year of being profitable last year as well as nearly doubling its revenues in 2020. 

Following a $319m secondary share sale in July 2020, TransferWise saw its valuation jump to $5bn, placing it in the top five of the highest-valued fintechs in Europe.” 

 

4. International – FinTech 

 

Close to 80 percent of the world’s central banks are either not allowed to issue a digital currency under their existing laws, or the legal framework is not clear, according to research conducted by the International Monetary Fund. Finextra reports: 


“The IMF paper reviewed the central bank laws of 174 IMF members, and found out that only about 40 are legally allowed to issue digital currencies. At 104 central banks, the law only authorises the issuance of banknotes and coins.

"Any money issuance is a form of debt for the central bank, so it must have a solid basis to avoid legal, financial and reputational risks for the institutions," states the paper. "Ultimately, it is about ensuring that a significant and potentially contentious innovation is in line with a central bank’s mandate. Otherwise, the door is opened to potential political and legal challenges."

To legally qualify as currency, a means of payment must be considered as such by the country’s laws and be denominated in its official monetary unit. Legal tender status is usually only given to means of payment that can be easily received and used by the majority of the population.

"To use digital currencies, digital infrastructure — laptops, smartphones, connectivity — must first be in place," notes the paper. "But governments cannot impose on their citizens to have it, so granting legal tender status to a central bank digital instrument might be challenging. Without the legal tender designation, achieving full currency status could be equally challenging."

An important design feature is whether the digital currency is to be used only at the wholesale level, by financial institutions, or could be accessible to the general public. Allowing private citizens’ accounts, as in retail banking, would be a tectonic shift to how central banks are organized, states the IMF, and would require significant legal changes. Only 10 central banks in the sample would currently be allowed to do so.

"The creation of central bank digital currencies will also raise legal issues in many other areas, including tax, property, contracts, and insolvency laws; payments systems; privacy and data protection; most fundamentally, preventing money laundering and terrorism financing," the paper concludes. "If they are to be the next milestone in the evolution of money, central bank digital currencies need robust legal foundations that ensure smooth integration to the financial system, credibility and broad acceptance by countries’ citizens and economic agents." 

 

5. International – FinTech 


Crowdfundinsider reports: 


“The team at Bit.com, which claims to be a secure and “high-performance” cryptocurrency derivatives exchange introduced by Matrixport, will reportedly be offering Bitcoin Cash (BCH) perpetual swaps and options. 

As mentioned in a release shared with Crowdfund Insider, the Bitcoin Cash option trading is scheduled to begin on Feb 1 2021 on Bit.com, which would be right after the launch of the perpetual swaps on Jan 20, 2021. 

As noted in the update, Bit.com’s offering of the Bitcoin Cash or BCH options is “the first of its kind” in the crypto and blockchain industry. Bitcoin Cash, which is the largest Bitcoin fork, has become more widely-adopted and is being recognized by institutions like Grayscale and has managed to rank No. 6 or 7 on the list of the top crypto. 

Bitcoin Cash has a market cap of between $8 billion to $9 billion at the time of writing with BCH trading at around $455, down considerably from its all-time high of over $3,600. 

As stated in the release, there’s been no options market for BCH (presumably due to low demand) and the liquidity of the perpetual swaps “also has room for improvement.” 

As explained in the announcement: 

“To put things into perspective, Bitcoin (BTC) and Ethereum (ETH) derivatives market grew tremendously during the past few years, and so did their relative shares of the underlying spot trading volume. Currently the cryptocurrency perpetual swaps market is dominated by BTC, which accounts for ~53% of the market share, while ETH attributes to 20%. BCH takes only 1% of the crypto perpetual swap market share, which is disproportionate to the relative market share of the underlying asset.”