Daily Crypto, Finance, and Tech News Summary – October 16, 2023

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Welcome, and thank you for being part of the MyZucoins community! Let’s get into an interesting piece of crypto, finance, or tech news to stay ahead.

People tapping credit cards at a fintech show event booth at front entrance of the Reserve Bank

Mastercard And Reserve Bank Of Australia Pilot Digital Currency

Mastercard, a leading player in payment processing, has recently joined forces with the Reserve Bank of Australia (RBA) to explore the possibilities of a unique type of digital currency.

Together, they have successfully tested a central bank digital asset (CBDC) that can only be used by approved parties.

Essentially, this means a pilot CBDC holder can purchase a non-fungible token (NFT) listed on Ethereum (ETH), a popular cryptocurrency platform.

This interesting experiment involved the RBA’s platform locking a specific amount of currency while creating an equal amount of wrapped pilot CBDC on Ethereum.

Mastercard has developed a solution that ensures this pilot CBDC is only accessible to approved parties who have passed the Know Your Customer (KYC) checks and have been risk-assessed by licensed service providers.

This successful test required the buyer and seller’s Ethereum wallets and the NFT marketplace’s smart contract to be approved or “allow-listed” within the platform.

Despite this progression, CBDCs have drawn some criticism, with concerns raised about potential privacy issues and financial censorship.

Most recently, US Republican lawmakers have supported a proposed law to prevent the Federal Reserve from issuing a CBDC, reflecting the controversy surrounding this new digital currency.

Australia’s Reserve Bank has also found issues with a similar CBDC pilot program.

The bill is now making its way to the full Australian Government House for further consideration. Read more here and here.

More On This Topic:

Australian Central Bank’s legal and technical roadblocks despite finding CBDC advantages.

US Dollar going digital? Not so fast, says Congress.

There is shrinking freedom in modern transactions. Can emerging cryptos like Zucoins become a beacon of transactional liberty amid CBDCs?

CBDC rollouts threaten freedom and privacy.

Amplifying the crypto effect: Various forces.

How Can Cryptos Balance Autonomy And Innovation In The Digital Currency Landscape?

Splitchain’s adaptability, rooted in its cutting-edge, unique, truth-based system rather than consensus-based, offers a distinct edge when interacting with digital currencies, much like how the RBA’s CBDC platform meshed with Ethereum.

The controlled access trial by Mastercard for CBDCs offers an intriguing model that could be explored further by third-parties potentially using Zucoins.

Zucoins already employs a two-way transaction mechanism, where a receiver requires confirmation to accept an incoming transaction.

Third-parties could extend further, essentially mirroring a “controlled access system”.

It would allow transactions only between their verified parties, akin to Mastercard’s trial, to pass certain criteria.

Beyond just payments, this could be used by third-parties to offer features on top of the network, such as coupons, loyalty or reward programs.

Splitchain and Zucoins’ core values revolve around user independence and freedom, especially considering the broader concerns surrounding CBDCs and potential financial censorship.

Censorship is usually a slippery slope that starts with excessive central control.

As CBDCs potentially usher in heightened surveillance, Zucoins can stand out, upholding user autonomy.

As each of these third-party extensions to the base system would be opt-in, users can move to different vendors based on their preferences.

Splitchain transactions remain swift and safer, without centralized interference.

Zucoins and Splitchain epitomize a counter-narrative to the invasive tendencies of CBDCs, showcasing how a balance between decentralization and functionality need not infringe on user rights.

Understanding the legal intricacies, as evidenced by the challenges faced by the Federal Reserve in releasing a CBDC, is pivotal.

While not strictly a feature-related issue, it highlights the unpredictable nature of this burgeoning field.

To stay ahead of this dynamic landscape, Zucoins have been proactive, anticipating upcoming shifts from regulators and legislators, ensuring they remain at the forefront of digital currency innovation while balancing key areas of compliance.

Zucoins is one of the very few crypto systems doing this.

Even more important is the fact that it’s one of the rare ones that isn’t based on another crypto itself, such as most “layer 2” tokens that end up being centrally controlled.

Splitchain is a proper ground-up rethink of what crypto could and is supposed to be—while keeping the spirit of the original mission set out by Bitcoin’s anonymous founder Satoshi Nakamoto.

This exploration by Mastercard and the RBA marks a potentially significant shift in the realm of digital currency.

It’s a development that we’ll continue to watch and report on, so make sure you’ve subscribed to this newsletter.

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All the best,
Peter & Rob

Disclaimer: Of course, this is not advice, financial or otherwise. It’s also important to consider the risks and challenges associated with any potential benefits.