Finance

UK to introduce stablecoin law in ‘months’: Circle’s Dante Disparte

Published

2 hours ago

October 23, 2024

Launched in 2018 by crypto firm Circle, USDC is now the second-biggest stablecoin globally, with more than $30 billion worth of tokens in circulation.

Nurphoto | Getty Images

LONDON — The U.K. is likely to see stablecoin laws introduced in a matter of “months, not years,” according to crypto firm Circle’s top policy executive.

Dante Disparte, Circle’s global head of policy, said that he sees the U.K. will soon bring in legislation for stablecoins, a type of cryptocurrency that aims to maintain a constant peg to government currencies such as the U.S. dollar or British pound

“I think we’re within months, not years” of formal laws for the stablecoin market being introduced, Disparte told CNBC in an interview last week during a visit to London.

The Treasury and the Bank of England were not immediately available for comment when contacted by CNBC.

Disparte suggested the U.K.’s lengthier approach to introducing laws targeted at crypto may have been a good thing given events that transpired in 2022, such as the collapse of FTX, a crypto exchange once worth worth $32 billion, as well as other industry crises.

“You could also look back, and I think many in the U.K. and in other countries would argue that they’re vindicated in not having jumped in too quickly and fully regulating and bringing the environment onshore because of all the issues we’ve seen in crypto over the last few years,” Disparte said.

However, he added that more recently, there’s been a sense of urgency to introduce formal regulations for stablecoins, as well as trading in digital assets and other crypto-related activities.

By not bringing forth stablecoin-specific rules, the U.K. would risk missing out on the benefits of the technology. He added that the U.K. has some catching up to do with the European Union, which has begun enforcing regulation of stablecoins under its MiCa, or Markets in Crypto Assets, regulation. Singapore has also agreed formal laws for the stablecoin industry.

“In the spirit of protecting the U.K. economy from excess risk and crypto, there’s also a point in time in which you end up protecting the economy from job creation and the industries of the future,” Disparte said. He stressed that “you can’t have the economy of the future unless you have the money of the future.”

Among the benefits cited by Disparte are innovation in the wholesale banking industry, real-time payments, and the digitization of the British pound.

Officials at the Bank of England are currently exploring whether or not to introduce a digital version of the pound, which has previously been dubbed “Britcoin” by the media.

How a $60 billion crypto collapse got regulators worried

Dante said he had met with officials from the Bank of England recently and was reassured by their approach to so-called central bank digital currencies, or CBDCs.

What has the UK done so far?

Prime Minister Keir Starmer’s predecessor, Rishi Sunak, had previously envisioned Britain becoming a global crypto hub.

When the Conservative Party was in power, U.K. government officials had signaled that new legislation for stablecoins as well as crypto-related services such as staking, exchange and custody would be in place as early as June or July.

In April, the former government announced plans to become a “world leader” in the crypto space, outlining plans to bring stablecoins into the regulatory fold and consult on a regime for regulating trading of cryptoassets, like bitcoin.

Last October, Sunak’s administration issued a response to a consultation on regulation of the crypto industry, saying it would aim to introduce “phase 2 secondary legislation” in 2024, subject to parliamentary approval.

The new Labour government hasn’t been as vocal as the Conservatives were on crypto regulation. In January, the party released a plan for financial services, which included a proposal to make the U.K. a securities tokenization hub.

Securities tokens are digital assets that represent ownership of a real-world financial asset, such as a share or bond.

Stablecoins are a multibillion industry, worth more than $170 billion, according to CoinGecko data. Tether’s USDT token is the largest stablecoin by value, with a market capitalization of over $120 billion. Circle’s USDC is the second-largest, with the combined value of coins in circulation worth over $34 billion.

However, the market has been shrouded in controversies in the past. In 2022, Tether’s USDT dropped from its $1 peg after a rival stablecoin, terraUSD, collapsed to zero. The events raised doubts over whether USDT was truly backed 1:1 by an equal amount of dollars and other assets in Tether’s reserves.

For its part, Tether says its coin is backed by dollars and dollar-equivalent assets, including government bonds, at all times.

Finance

Chinese smartphones tout AI ahead of Apple Intelligence launch

Published

50 mins ago

October 23, 2024

Business Finance News

Chinese smartphone company Honor on Wednesday revealed new AI features. Pictured here is CEO George Zhao speaking in Shanghai on June 26, 2024.

Nurphoto | Nurphoto | Getty Images

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Honor, a spinoff from Huawei that focuses on higher-end devices, revealed Wednesday the latest version of its Android-based Magic operating system would focus on AI as an assistant.

A company demo showed how even with a vague voice command — such as “I’m tired, order something” — the phone was able to automatically order coffee without requiring the user to touch the device. It used AI to mimic actions on a touchscreen. Human intervention was only needed to complete the payment.

The AI assistant could also identify documents and send them to contacts, or make calls via social media app WeChat, all without requiring the user to touch the phone.

For devices in China, Honor works with Baidu and other Chinese companies for some AI functions, while developing others on its own. Honor works with Google for devices sold overseas.

The new AI features are slated for release on Honor’s forthcoming Magic 7 smartphone, due for launch on Oct. 30. Honor plans to roll out AI capabilities to all its devices by the first few months of next year.

The Magic 7 will use Qualcomm‘s newly announced Snapdragon Elite 8 chip for phones. Honor on Monday had teased its new AI features at the chipmaker’s annual event.

Chinese home appliance and smartphone company Xiaomi will also launch a new phone this month that uses Qualcomm’s Snapdragon Elite 8 chip. Xiaomi has been less vocal about its AI features for smartphones.

The AI features have climbed to a new level, Toby Zhu, senior analyst, Canalys, said in a phone interview Wednesday after Honor’s event. He said the new features have greater potential to convince consumers to switch to another device.

“Apple faces challenges in China but from our data it won’t face a significant decline,” he said in Mandarin, translated by CNBC.

Apple’s falling China sales

Honor, Xiaomi and Huawei have all launched foldables, a category Apple has yet to enter.

About 17% of Apple’s revenue came from Greater China in the quarter ended June 29. That’s down from 19% in the year-ago period. Apple is scheduled to release quarterly results on Oct. 31 local time.

Apple CEO Tim Cook met with China’s Minister of Industry and Information Technology Jin Zhuanglong on Wednesday to discuss data security and cloud services, according to the ministry. Apple did not immediately respond to a CNBC request for comment.

Since launching on Sept. 20, Apple’s iPhone 16 Pro Max has dropped slightly in value on second-hand shopping platform Xianyu. The device was selling between 8,000 Chinese yuan ($1,122) and 10,000 yuan Wednesday, compared with 10,500 yuan to 16,300 yuan last month.

Huawei had launched its trifold Mate XT on the same day. As of Wednesday, second-hand prices for the device had dropped to the mid-20,000 yuan range, nearly half the price it was selling for on Sept. 20.