Sunday, November 24, 2019

58% of German Banks Charge Negative Interest Rates


Germany's central bank, the Deutsche Bundesbank, has conducted a survey of banks charging negative interest rates on customer deposits. Some are charging retail customers as well as corporate clients. An independent price comparison portal shows which banks are currently charging for deposits and how much they are charging.

Central Bank Survey
A growing number of German banks are passing on the burden of negative interest rates to their customers as the European Central Bank (ECB) continues to maintain a negative interest rate policy (NIRP). The current ECB deposit rate is -0.5%, the lowest on record.

"Many banks in Germany have introduced negative rates on deposits," the Deutsche Bundesbank wrote in its November monthly report after conducting a survey of 220 banks at the end of September regarding their negative interest rate policies. The central bank believes that the surveyed banks constitute a representative sample of the overall sector, thereby allowing it to make qualified statements concerning the spread of negative interest rates on customer deposits in the German banking sector. The Financial Times summarized:

58% of the banks said they were levying negative rates on some corporate deposits and 23% said they were doing the same for retail depositors.

Even the country's largest banks have started charging their customers for deposits. Deutsche Bank CFO James von Moltke told analysts last month that his bank had stepped up its attempts to pass on the negative rate burden to corporate clients. "This is more difficult in the private bank business than in corporate or institutional deposits and we don't see an ability to adjust legal terms and conditions of our accounts on a broad-based basis," the CFO was quoted as saying. He added that his bank had also approached some retail clients with large deposits on the matter.

Similarly, Commerzbank CFO Stephan Engels revealed earlier this month that his bank had already been approaching wealthy retail customers holding deposits of more than 1 million euros ($1.11 million).

Which Banks Charge Negative Interest Rates
While the central bank did not provide a list of banks that are charging negative interest rates, German consumer price comparison platform Verivox has published several lists of banks that fall into this category. The platform claims to have examined the policies of over 800 German banks.

According to its current database, at least 21 banks have published their negative rate policies online and seven others are charging fees for money market accounts which are usually free. Further, the platform lists 20 other banks that the media have reported as charging for deposits but they have not published the information on their websites.

Verivox's list of 21 banks currently charging negative interest rates on customer deposits. was able to verify that a number of banks on the Verivox list do charge negative interest rates including Berliner Volksbank, Ethikbank, Skatbank, Sparda-Bank Berlin, Sparkasse Harburg-Buxtehude, Volksbank Eisenberg, and Volksbank Fürstenfeldbruck. Berliner Volksbank, one of the largest German cooperative banks, started charging -0.5% on accounts with at least 100,000 euros on Oct. 1, as previously reported.

Following the move by the ECB to lower the key interest rate to -0.5% in September, Skatbank announced its negative interest rate policy, emphasizing:

We can no longer economically accept responsibility for maintaining the ECB negative interest rate in full. So far, negative interest rates were only incurred for large-scale depositors. As a result of its actions, the ECB leaves us no other choice than to further restrict our deposit business.

Another German price comparison website, Biallo, claims to have found more than 150 German financial institutions that are charging negative interest rates. Founder Horst Biallo wrote, "A survey of just over 1,300 banks and savings banks shows that a good 150 financial institutions are now charging negative interest, 52 of which are private sector institutions." However, his list is not publicly available.

First Bank to Charge Small Savers Negative Rate
Among the 21 banks on Verivox's list is Volksbank Fürstenfeldbruck, a cooperative bank located west of Munich. The bank has recently been in the news for being the first German bank to pass on the cost of negative interest rates to even small savers.

The bank explained that it will collect a custody fee of -0.5% on instant access savings accounts, the Financial Times detailed. "New clients who also do other business with the bank, such as real estate financing or pension planning, will be exempt from the charges." The bank's website shows that accounts opened on Oct. 1 or later with deposits of 0.01 euro or more will be charged the fee. Inundated with inquiries about its new policy following media reports, the bank put up an explanation on its website, emphasizing that only new clients are affected. Verivox CEO Oliver Maier was quoted by the Financial Times on Tuesday as saying:

Negative interest rates have now reached the average saver.
What do you think of a growing number of German banks passing on the burden of negative interest rates to their customers? Let us know in the comments section below.

Sunday, November 17, 2019

Bitcoin Cash Community Funds Eatbch Trip to Ghana


This week members of the Bitcoin Cash (BCH) community donated funds to Eatbch South Sudan volunteer Thiong Deng so he could spread the word about the benefits of BCH at the Young African Leaders Summit. According to Deng, his journey to Uganda and Ghana has been fully funded which includes flight, hotel, visa costs, and a ticket to the event.

Eatbch South Sudan Volunteer Heads to the Young African Leaders Summit
Eatbch is easily recognized as the Bitcoin Cash community's most favorite charity because the nonprofit organization has been using BCH to help people throughout Venezuela and South Sudan. People can follow Eatbch on Twitter and see how the "peer-to-peer electronic cash-to-food system" feeds families and children in need regularly. Just recently, the nonprofit published a new website called that shows the tremendous work being done in South Sudan and Venezuela. Moreover, the website's visitors can donate bitcoin cash directly to the effort so people can help others experiencing economic hardships and difficult times.

Last September, reported on Eatbch South Sudan leader Emmanuel Lobijo, who was invited to attend the UN Secretary-General's Climate Action Summit. Lobijo joined Greta Thunberg and many other activists at the UN's event in New York. The Eatbch South Sudan leader explained how BCH can "bridge access to the world" and how the charitable organization is using bitcoin cash to fight water wars, drought, and famine in the African country.

This week members of the BCH community funded Eatbch South Sudan volunteer Thiong Micheal Deng's trip so he could attend the Young African Leaders Summit in Ghana. On November 13 and 14, BCH proponents on Twitter and Reddit asked the community to help fund Deng's trip. "Can we get Thiong, an Eatbch South Sudan representative to the Young African Leaders Summit? He still needs $800 dollars of funding," one Reddit post asked. Deng disclosed all the anticipated expenses for the trip to the Young African Leaders Summit and thanked the community for the "generous donations" but he still had $835 left to raise.

BCH Community Funds Travel Expenses to Ghana
On Twitter, software engineer Josh Ellithorpe (who designed the website) also asked BCH supporters to help fund Deng's travels. "This is the last day to get Thiong (an Eatbch South Sudan representative) to the Young African Leaders Summit," Ellithorpe tweeted. "Let's support him in spreading the word about Bitcoin Cash and the excellent work of Eatbch."

After a few BCH proponents made requests to the community, Deng managed to get the funds needed to embark on the trip. "Thanks, Bitcoin cash community," Deng said. "[You] have set up my journey to Uganda — 18-hour bus drive — then flight to Ghana for the conference. BCH you made it happen — thanks for the love." The BCH community members who helped fund the trip and the work being done by Eatbch at large demonstrates how passionate BCH proponents are about peer-to-peer cash. The work Eatbch does each and every day showcases how decentralized, borderless cryptocurrencies can truly revolutionize the global economy.

Saturday, November 16, 2019

Royal Bank of Canada Patents Point to Crypto Exchange Launch


The largest bank in Canada by market capitalization, Royal Bank of Canada (RBC), is reportedly opening a cryptocurrency exchange. Patents have been discovered that reveal some of the technology the RBC may implement, which could be used to bring digital currency trading to the bank's 16 million clients.

The Royal Bank of Canada May Launch a Crypto Exchange
A report stemming from the publication The Logic claims that the RBC is currently exploring the construction of a digital currency trading platform. Columnist Zane Schwartz wrote on November 11 that the bank will give customers the ability to invest and trade cryptocurrencies like BTC and ETH. The report reveals RBC is interested in creating funds with a basket of digital currencies as well. "The bank is also looking into letting customers open bank accounts containing cryptocurrency," Schwartz wrote. If the crypto trading platform comes to fruition then the Canadian bank will be the first financial institution in the country to offer such services.

At the last World Economic Forum in Davos, the Royal Bank of Canada's CEO, David McKay, told the public that the financial institution aims to leverage distributed ledger technology. "We're experimenting with taking an asset and breaking it into smaller pieces and registering that in a decentralised register called blockchain. You can take an asset or even a company and create a unit on a decentralised blockchain and then sell that into the marketplace," McKay said during a panel discussion.

Speaking with Schwartz, RBC spokesperson Jean Francois Thibault explained that the Canadian financial institution "like many other organizations, files patent applications to ensure proprietary ideas and concepts are protected." Thibault would not confirm to Schwartz whether or not the RBC would be constructing a new trading platform for cryptocurrencies.

Royal Bank of Canada Patents Point to Crypto Exchange Launch
A while back, RBC's wealth management service published a report outlining the benefits and risks tethered to digital currencies.
As early as 2015, the RBC expressed interest in blockchain and McKay explained that the technology was a "quantum innovation." "It is a brand-new technology, and what do we really know about it? How cyber-secure is it? We are going to learn a lot more about it," McKay told the publication American Banker. "Given what is at stake, it is not something you can rush to market with and fix as you go. You want it to work."

Royal Bank of Canada Patents Point to Crypto Exchange Launch
Royal Bank of Canada patent CA 3038757: A system and method for handling crypto-asset transactions.
Alongside this, RBC's wealth management arm also published a report called "Bitcoin and beyond: Five things to know about cryptocurrency." The RBC study notes there are plenty of risks associated with decentralized blockchain assets, but in the long run "the possibilities of cryptocurrencies are undeniable."

International Law Enforcement Conference Addresses Crypto and the ‘Criminal Economy’


The 2019 National Proceeds of Crime Conference (NPOCC) held in Brisbane, Australia from November 13-15 addressed "Globalisation and Digitisation of the Criminal Economy," and featured 200+ delegates hearing from representatives of organizations such as the Australian Federal Police, Singapore and New Zealand police, United States Department of Justice, and the Australian Criminal Intelligence Commission. The conference set out to address how to better seize criminal profits and face challenges to law enforcement presented by the darknet and cryptocurrencies like bitcoin.

Addressing Crypto Crime
Justine Gough, Acting Assistant Commissioner for the Australian Federal Police (AFP), stated that "Advances in technology, like cryptocurrency and encrypted communications have changed the way criminals acquire and hide their assets" and that "Seizing and removing the profits of crime is one of the most effective capabilities we have in impacting organised criminal networks."

The international conference, which aimed to address such topics as "the Darknet, trends in money laundering, collaboration in investigations; evidence collection in an age of cloud-based data and the monetisation of cybercrime" focused on how relevant organizations respond to crime in an age where cryptography and digital assets like bitcoin have enabled greater efficiency in skirting law enforcement. The push echoes recent sentiment from the U.S. Federal Bureau of Investigation (FBI) whose director Christopher Wray claimed problems presented by such technologies are getting "bigger and bigger."

Money Laundering and the Darknet
Since the takedown of infamous darknet marketplace Silk Road in 2013, bitcoin and crypto have been in the mainstream media spotlight, and in the sights of law enforcement and financial regulators worldwide when it comes to money laundering and illegal activities. U.S. Treasury Secretary Steven Mnuchin has claimed that bitcoin and crypto are a "risk to the financial system" while pushing back against the idea that the world reserve U.S. dollar is used comparably. "I don't think it's been successfully done with cash. I'll push back on that. We're going to make sure that bitcoin doesn't become the equivalent of Swiss-numbered bank accounts," Mnuchin stated in July.

AFP Acting Assistant Commissioner Gough says of the NPOCC:

We are honoured to have representatives from law enforcement, government departments and private enterprise … share their insights and to collaborate on how we respond to emerging technologies like cryptocurrency.

The response has already been swift and formidable. From numerous arrests of those transacting and trading in crypto — both criminal and non-criminal elements alike — to powerful tax agencies like the IRS issuing thousands of warning letters to potential crypto non-filers and money launderers, it's clear law enforcement worldwide means business. The question of what kind of similar enterprise in trafficking, money laundering and tax evasion is being done with the almighty USD remains noticeably off the table, however.

Worldwide Enforcement Efforts
It will be interesting to hear the conclusions of this week's Brisbane conference, and to see what developments proceed from the talks on monetization of cybercrime via crypto. Already global policymakers and joint enforcement initiatives such as the Financial Action Task Force (FATF) and the Joint Chiefs of Global Tax Enforcement (J5) are working to broaden the intelligence and enforcement dragnet for targeting unauthorized and permissionless financial activity worldwide. As the NPOCC's problematic "Digitisation of the Criminal Economy" continues, the crypto space can expect even more scrutiny and heightened KYC/AML compliance measures in 2020.