#382
Tools Of The Trade

Coinbase posts blowout Q1 profit of $730-$800m, days before public listing - Coinbase announced its 2021 first quarter earnings on Tuesday, revealing that the crypto giant made a profit of between $730m and $800m on revenue of approximately $1.8b. The results amounted to a blockbuster quarter for Coinbase, eclipsing its performance for the entire previous year. Read more

Yellen to urge global minimum company tax to stop venue-hopping - Yellen’s comments are part of an effort to prevent companies from seeking locations with lower taxes as the administration seeks higher levies on American firms to help pay for a $2.25t infrastructure program. Yellen will say the U.S. is working with G-20 nations to find an appropriate minimum “that can stop the race to the bottom.” Read more

Crypto market cap surges to record $2t, bitcoin at $1.1t - Bitcoin has risen more than 100% this year, while ethereum has gained nearly 190%. Both have massively outperformed traditional asset classes, bolstered by the entry of mainstream companies and large investors into the cryptocurrency world, including Tesla Inc and BNY Mellon. Read more

Credit Suisse takes $4.7b Archegos hit, replaces risk chief - While Credit Suisse was far from the only bank that allowed Bill Hwang’s family office to lever up large positions in a few stocks, others managed to unwind their exposure quickly with minimal damage. That raised questions over Chief Executive Officer Thomas Gottstein’s handle on the firm’s risk just weeks after the lender was caught up in another implosion of a little known financial player. Read more

Fintech is here to stay, says JPMorgan chief Jamie Dimon - Fintech companies are set to win significant market share from banks says JPMorgan's Chase chief Jamie Dimon, who laments the regulatory constraints that hobble banks as they face up to the threat from Big Tech competitors. Read more

Walmart files for trademark for fintech unit: ‘Hazel by Walmart’ - Walmart has shared few details on the fintech venture thus far, but the world’s largest retailer filed for a trademark on the name on March 29, in the process giving clues as to what the startup might actually do. Read more

Facebook confirms ‘test’ of Venmo-like QR codes for person-to-person payments in US - The QR code feature, similar to Venmo’s QR codes and others, will allow a user to scan a friend’s code with their smartphone’s camera to send or request money, while the sharable payment links will let you publish your payment address outside of Facebook itself. Read more

Sweden pushes ahead with a digital currency rollout—just don’t call it a ‘crypto asset’ - Sweden has strengthened its position in the race for a central bank digital currency (CBDC) after concluding the first phase of testing for its proposed currency, e-krona. In one of the most advanced explorations undertaken by a major economy, Sweden’s central bank, Riksbank, is now bringing in banks to test how the digital currency might work practically. Read more

Five banks to test FedNow real-time payments system - The Federal Reserve’s FedNow program, intended to streamline the clearing and settlement process, will be tested by five Northern California regional banks and three credit unions (CUs). FedNow, which will be fully implemented by 2023, will let individuals and companies transfer funds between accounts, pay bills and send or receive money from friends or family. The services will be near-real time and be available any day or time of the year. Read more

SEC accuses actor of $690m fraud based on fake Netflix deal - The claims are outlined in legal documents that U.S. prosecutors and the Securities and Exchange Commission released this week alleging Horwitz, 34, was running a massive Ponzi scheme. His scam: a made-up story that he had exclusive deals to sell films to Netflix and HBO. Dating back to 2014, the SEC said he raised a shocking $690m in fraudulent funds. On Tuesday, Horwitz was arrested. Read more

Companies selected for 11th Annual FinTech Innovation Lab New York - FIL announced the 10 startups selected to participate in the 2021 FinTech Innovation Lab New York program, from more than 200 applications across the globe. These companies aim to help financial institutions address key societal challenges, including managing climate risk, operating more sustainably, and developing improved digital products for customers. Read more

Goldman, BofA, JPMorgan line up to fund Nubank’s Mexico venture - Nu Mexico, as the unit is known, is receiving a $70m capital injection from its Brazilian parent company while JPMorgan, Goldman Sachs, and Bank of America will provide revolving credit lines worth $65m, General Manager Emilio Gonzalez said in an interview. Read more

Why Coinbase’s stellar earnings are not what they seem - The FT's Alphaville argues that the stand out concern remains that the current framework under which Coinbase is regulated (a money transmission one) is not at all suited to regulating its broader activities and that It’s easy to be profitable if your real unique selling point is being a beneficiary of regulatory arbitrage. Read more

Millions are tumbling out of the global middle class in historic setback - For the first time since the 1990s, the global ­middle class shrank last year, according to a recent Pew Research Center estimate. About 150m people, a number equal to the populations of the U.K. and Germany combined, tumbled down the socioeconomic ladder in 2020, with South Asia and sub-Saharan Africa seeing the biggest declines. Read more

State Street to provide tech for cryptocurrency trading platform - State Street said it would partner with Pure Digital, a start-up that aims to offer cash cryptocurrency trading for investors through their existing bank relationships, with State Street’s Currenex platform providing the underlying technology. The venue is set to go live in “mid-2021”. Read more

Walnut wants to crack open flexibility for healthcare bills - Its biggest challenge, says Patel, is to underwrite the population and pay the healthcare provider upfront in cash. It then collects from the patient on the back end, which comes with its own amount of risk. Read more