In this week’s Fintech FT, Silvia Sciorilli Borrelli wrote about the Italian financial regulator’s warning about cryptocurrencies. I interview the CEO of the ethical and halal investment app Wahed and evaluate why Amazon has stopped banning Visa’s UK credit cards.
Italian Regulatory Cryptographic Warning
Consob, Italy’s financial services regulator, warns about the risks associated with the increase in economically illiterate Italians investing in cryptocurrencies.
An annual survey of investment trends in Italy reveals a surge in individual investors’ interest in online trading and cryptocurrencies. This is a tendency for regulators to link to people who are forced to work from home due to pandemic restrictions.The world is Retail broker Blockade.
Consob Chief Paolo Savona has already emphasized the risks posed by Italy’s unregulated cryptocurrencies, which have high personal savings and low financial literacy. With over 1.4 trillion euros in Italian private bank accounts, the potential for investment is enormous.
However, of the 2,700 people interviewed by Consob, only half were able to answer basic financial questions, raising concerns about whether their investment fits the risk profile. In addition, nearly 40% of survey respondents said they received advice from friends and family rather than professional advisors.
Regulators elsewhere have shown increasing discomfort to individual investors flocking to cryptocurrencies. Last September, Charles Randell, chairman of the Financial Conduct Authority in the United Kingdom, said: caveat The vulnerable people risked endangering their economic futures with speculation of digital assets.
The Federal Reserve said in November last year that U.S. institutions that regulate the financial system would make cryptocurrencies more legal. Throughout 2022..
Italian authorities are calling for better EU regulation. However, they also urged the Italian Parliament to intervene if international efforts to regulate cryptocurrencies were delayed. Gambling is high in Italy.
Corrado Passera, founder and chief executive officer of Illimity Bank, told the Huffington Post that it is “very urgent” for Europe to develop its own digital currency.
“We need the digital euro to create new opportunities, but without it, it would be very difficult to protect our sovereignty, and thus our political and economic sovereignty,” he said.
Passera added that it is impossible to understand the meaning of the argument without understanding the extent of global growth in cryptocurrencies, which has already led to mediation and deregulation. Despite the decline at the end of 2021, the market capitalization of the cryptocurrency market will be close to $ 2.2 trillion, up from about $ 750 billion a year ago.
((((Silvia Sciorilli Borrelli).
Quick Fire Q & A
Every week, we introduce ourselves to the founders of the fast-growing FinTech and ask them to explain why they stand out in a crowded industry. The lightly edited conversation is displayed below.
We spoke with Junaid Wahedna, Founder and Chief Executive Officer of Wahed Invest, the world’s first automated halal investment platform. Released in 2017, the app excludes obvious categories such as alcohol stocks, but uses debt ratios and other factors to determine if a stock is applicable. To date, it has raised $ 40 million in seed and series A rounds, with Saudi Aramco Entrepreneurship Venture, Rasamir Investment Company, Cuball, Dubai Cultiv8 and BECO Capital being the largest shareholders. In 2021, we released the app in the UK market.
Where did the Wahed idea come from? This idea was invented in New York City in 2015 when I was working as a Wall Street banker. I was behind the yellow cab and asked me where the driver should invest.At that time, he asked the locals because he had no option to get the financial guidance needed to invest in an ethical and halal way. Imam Where to put his money. The Imam Apple’s stock is compliant, so the driver told him he was trying to put all his family’s retirement savings into one stock. As a result, people thought they needed an easy, accessible and affordable Halal investment platform.
What are the specific challenges in running a halal investment platform? The biggest challenge is to ensure that Shariah’s requirements are met if the investee company is based in an economic zone that does not have the same requirements. For example, banned industries such as pornography and gambling can be considered immoral, but they are not illegal in many countries. In addition, many financial systems assume interest, which makes it very difficult to avoid or limit, and makes it more difficult to find such stocks or stocks.
In a broader sense, how do you approach ethical investment? Part of the challenge comes down to how the company is organized and the amount of work involved. This can greatly increase the likelihood of activities that do not meet ethical requirements. Investment is based on publicly available information, so reports can always be set to reflect what the company wants to see. Navigating all of this while the report is still in its infancy is a major hurdle.
Wahed uses mixed criteria to help you navigate our investments, from debt ratios to negative screening to more and more consideration of companies that provide social benefits. By using mixed standards, you can choose a company with an established track record and take some steps to ensure that you are ethical.
What were your considerations for both existing competition and new customers when launching in the UK? The UK is still under-invested and there are many poorly serviced communities, such as Muslims, who want to invest in ethical and halal ways. But Wahed’s mission goes beyond that. We want to create an alternative to a debt-based financial system that is better and more sustainable for everyone.
The charm of Fintech
Amazon stops banning Visa — A few days before it will be implemented. The news The fact that retailers and payment providers were working on solutions seems to prove industry analysts who predicted it was a bargaining tactic. Visa, which accounts for about one-third of the UK credit card market, is the only major player in the UK that does not offer Amazon-affiliated cards.
Cryptolandsaga is here — Jemi McKelly Report The promotional video about the promised development of the strange story of Crypto Paradise Island was so widely shared (for the wrong reason) that it was pulled from the official YouTube channel. Critics have been sent a cease and desist letter without the approval of a lawyer, or, according to one tweet, a “cease and desist,” asking questions about the assets used in the promotional video.
Signal’s payment punt under scrutiny — Rex Evaluate The latest encrypted messaging app for exploring digital payments. Although a small player on the market, Signal’s investigation of anonymous digital payments is unlikely to beat regulators with the option to make payments in a way that avoids government oversight.
Italian regulators warn against crypto investment
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