Visa goes for USDC with Circle

On By mehranmuslimiblogIn Bitcoin, Blockchain, Ethereum, FintechLeave a comment

Visa, the credit card giant, has joined with Circle to connect 60 million merchants to the US Dollar Coin (USDC), a coin on the Ethereum blockchain. This is yet another sign that cryptocurrencies are integrating even further with mainstream payment currencies.

Although Visa won’t have custody itself of the USDC, it is going to work with Circle to select Visa credit card issuers and integrate the USDC software with their platforms, so that it can be used for payments. What this means is that businesses will soon enough be able to make international payments in USDC to other businesses supported by Visa. The funds will then be converted into national currencies when they are spent anywhere that accepts Visa.

Circle is a part of Visa’s Fast Track program, and when it completes the course next year, that is when this new USDC program will begin, with the issuance of a new credit card that allows users to spend USDC. Visa’s head of crypto, Cuy Sheffield, said, “This will be the first corporate card that will allow businesses to be able to spend a balance of USDC. And so we think that this will significantly increase the utility that USDC can have for Circle’s business clients.” 

The partnership between Visa and Circle, helped by the $40 million investment Visa made in another firm developing a platform for holding similar assets issued on a blockchain, “is the latest evidence that the credit card giant sees the technology first popularized by bitcoin as a crucial part of the future of money,” Michael de Castillo writes at Forbes.

Sheffield said, “Blockchain networks and stablecoins, like USDC, are just additional networks. So we think that there’s a significant value that Visa can provide to our clients, enabling them to access them and enabling them to spend at our merchants.”

Currently, according to Visa’s data, “$120 trillion in payments annually are made using checks and instant wire transfers, costing as much as $50 each.” By contrast, since USDC settles on the ethereum blockchain, transactions can close in a little a[s] 20 seconds and, importantly, can be done for nearly free.

Visa has been making strong moves in the cryptocurrency sphere this year. In February 2020. Coinbase became the first company granted principal membership status by Visa. This means that Coinbase, one of the biggest crypto exchanges globally, can in turn issue cards to others.

Circle has done some rethinks of its own in regard to cryptocurrency. In 2019 it had a fire sale of its assets including Poloniex, Circle Invest and Circle Pay. It also rebranded its home page with a focus exclusively on stablecoins and central bank digital currencies. The attraction of the USDC is that it is built on the Ethereum block chain and only tiny amounts of the cryptocurrency ETH are used as “gas” to pay for the transactions.

Jeremy Allaire, the CEO of Circle Internet Finance, says of the new partnership and its probable outcome: “Imagine a capital marketplace that is for anyone who needs capital, or anyone who needs to offer capital that has the same efficiency that Amazon has for e-commerce, the same efficiency that YouTube has for content, effectively, capital markets with the efficiency of the internet, which is essentially zero.” He added, “And that will ultimately return trillions of dollars in value back to the economy, it will reduce costs for every business in the world, it will accelerate the way in which individuals can participate in commercial activity and commerce activity, in conducting their labor and interacting with businesses around the world.”

2020 Cybersecurity: Year Zero Trust

On By mehranmuslimiblogIn CyberSecurityLeave a comment

Prior to 2020, “the technology industry has long assumed that it would eventually get rid of the concept of implicit digital trust,” Emil Sayegh writes, pointing out that this got completely flipped this year as digital transformation was forced on a new route due to the surge in remote working. He calls it the year of ‘Zero trust’.

Why is this? Because organizations have had to rethink their security concerns with so many employees working from home. “Remote work IT capabilities changed the perimeters of traditional security, as well as its threat, Sayergh says, and adds that there is mounting evidence “that since this big shift, cybersecurity threats and threat vectors have increased 400% from pre-Covid times.”

Cybercriminals were quick to catch on to the fact that there were bound to be places that were easy to breach, plus they have updated their methods of attack to exploit fears by using more ransomware and targeted malware on organizations. What this tells us that there is a critical need to deal with their threats in a more efficient and intelligent way.

Every day is ‘Day Zero’

A ‘Day Zero’’ is the day that any cyber threat is unleashed, and in “a Zero Trust world, every day is assumed to be a potential ‘day zero’,” Sayergh says. The position to take from an IT perspective is one of overarching ‘mistrust’ and continuous vigilance over “who accesses what at every level possible.” As Sayergh remarks, every time a network is accessed it should be treated as ‘stranger danger’. Therefore all access should be “fully authenticated, authorized, and encrypted before any access can happen.” Ultimately, Zero Trust operates on the basis of a “hermetically sealed security” that also “empowers employees to work securely and efficiently, wherever they may be operating.”

As organizations now work on implementing Zero Trust, security capabilities are increasing. It also applies to cybersecurity strategies, and “leverages tools such as multi-factor authentication and active session-based risk detection to produce higher levels of security.”

In effect, Zero Trust has been akin to the cavalry riding into 2020. As Sayergh concludes: “By controlling access to specific applications, systems, and resources combined with an assumption of the continual breach, Zero Trust is positioned to enable a seamless move to greater security for all.”

Can Google Plex win over banks and consumers?

On By mehranmuslimiblogIn apps, Banks, FintechLeave a comment

It’s only a matter of days since I wrote about the relaunch of Google Pay. Now I turn my attention to Google Plex. With a beady eye on the way traditional banks are lagging in the mobile banking stakes, it has come up with a solution that enables the old boys to keep pace with the fintech challengers, or at least that is what it appears to promise.

Ron Shevlin quotes some observations from the Snark Tank, such as this summary of the Google Plex pitch: “You’re lagging in technology. Your current vendors are years behind. Consumers think you’re irrelevant. We’re hip, we’re cool, we have all the latest technologies, and boy have we’ve got data! Come partner with us on our new checking account!”

And to some extent the potential customers are buying it. Shevlin says “three big banks, four community banks, two credit unions, and two digital banks” have announced that they have formed partnerships with Google to use the Google Plex checking account tech in 2021.

Now let’s go back to Google Pay. Google Plex will be integrated into the app, which now has three new components.

First, it has a P2P and retail payments component that essentially mimics the Venmo model. This will allow users to, “Set up group payments, put multiple people in a chat and let them send and request money from each other. It will also track who has and hasn’t paid their share and let you tap a button to pester them,” according to The Verge.

Users can also use tap-to-pay, which is pretty old hat now, except that Google has added two new features – ‘Get gas’ and ‘Order food’. Apparently the latter refers to a food ordering system that will work with more than 100,000 restaurants. And consumers will be able to use the ‘get gas’ tab to pay for gas and parking via the app in 30,000 locations.

The ‘Explore’ feature will allow Google Pay app users to browse aggregated merchant offers, and they can receive merchant offers based on their spending activity. It sounds a little like Google ads and Facebook advertising all over again.

There’s also an ‘Insights’ tab which is described by Shevlin as “Google’s version of a personal financial management (PFM) tool,” similar to those available on other digital banking platforms.

Why is Google likely to win over banks to using Google Plex: It’s quite simple: Google has access to more data than any bank; Goggle has more merchant relationships, and it has more tech resources.

Of course, while the traditional banks might see Google’s offer as the fast and easy way to catch up with digital challengers, there is one critical factor to consider: will the consumer want a Google checking account?

Mastercard introduces AI-powered cybersecurity

On By mehranmuslimiblogIn AI, CyberSecurityLeave a comment

Cybersecurity remains one of the hottest topics around. While browsing today’s media I noted one article said that cyber attacks rose by 250% during the pandemic. Apparently it was the perfect time for scammers and hackers to wield their weapons.

This may be one of the things that prompted Mastercard to launch Cyber Secure, “a first-of-its-kind, AI-powered suite of tools that allows banks to assess cyber risk across their ecosystem and prevent potential breaches.”

 

It all comes down to the fact that the digital economy is expanding rapidly and is more complex. Alongside this positive news, comes the less appealing revelation that the growth creates a vulnerability that some are delighted to take advantage of.  For example,it is estimated that one business will fall victim to a ransomware attack every 11 seconds by next year.

 

Ajay Bhalla, president, Cyber & Intelligence, Mastercard said:

“The world today faces a $5.2 trillion cyber breach problem. This is one of the biggest threats to consumer trust. At Mastercard, we aim to stay ahead of fraudsters and to continually evolve and enhance our protection of cyber environments for our bank and merchant customers. With Cyber Secure, we have a suite of AI-powered cyber capabilities that allows us to do just that, ensuring trust across every experience, for businesses and consumers.” 

 

Cyber Secure will enable banks “to continuously monitor and track their cyber posture,” writes Polly Harrison. It will allow banks to be more proactive in managing and preventing data compromise, as well as protecting the integrity of the payment ecosystem and consumer data. It should also, of course, prevent financial loss caused by attacks.

Mastercard has based its new product on the AI capapbilities of RickRecon, which it purchased in 2020. It uses advanced AI for risk assessment, which evaluates multiple public and proprietary data sources and checks it against 40 security and infrastructure criteria.

Harrison writes, “In 2019, Mastercard saved stakeholders $20bn of fraud through its AI-enabled cyber systems,” so it is to be hoped that Cyber Secure prevents even more theft in 2021 and beyond.