10.13.17 Your morning briefing

Enjoy complimentary access to top ideas and insights — selected by our editors.

The information you need to start your day, from PaymentsSource and around the Web:

Bitcoin? What bitcoin? JPMorgan Chase chairman and CEO Jamie Dimon this week told investors he's no longer going to discuss bitcoin, following his calling the virtual currency a "fraud" and comparable to the Dutch tulip bubble during another investor event about a month ago. His remarks caused a fevered response from inside and outside the virtual currency community. Under investor questioning during JPMorgan Chase's earnings on Thursday, Dimon was still dismissive, saying Bitcoin isn't "high on the category of important things in the world," according to CNBC. During Citigroup's earnings call, John Gerspach, Citi's CFO, said cryptocurrency is an area "worthy" of exploration and said Citi development labs in Tel Aviv and Dublin are examining cryptocurrencies and blockchain. Bitcoin reached a record high of $5,231 on Thursday, up 8%.

Matthew Lloyd/Bloomberg

Breaches galore: Hyatt and Equifax are suffering breach reruns. Hotels are particularly prone to data breaches, and Hyatt Corp. has reported its second major breach in two years. Security writer Brian Krebs reports the new breach exposed cardholder names, numbers, expiration dates and internal verification codes for manually entered or swiped cards at front desks at locations in Hawaii, Guam and Puerto Rico between March 18 and July 2, 2017. There's no indication at this point that other information was compromised. In 2015, Hyatt announced a breach that affected systems at 250 hotels in 50 countries. Hotels have a heightened risk because cardholder information is stored for longer periods of time to accommodate the duration of a guest's stay. In other breach news, Equifax took one of its help pages offline as its security staff checked into another possible attack, following its recent breach that impacted up to 145 million people. In this new incident, Reuters reports Equifax's website on Wednesday had been infiltrated by hackers that were attempting to trick visitors into installing malware by passing it off as an Adobe Flash update.

Faster cryptocurrency: Coinbase will offer instant purchases for cyptocurrency with immediate funding from an American bank account. The time frame is much less than the current waiting period of up to five days, since Coinbase waited for ACH transfers before crediting purchases. Coinbase did allow instant payments for people who used credit cards to buy cryptocurrency, though those purchases carry a fee of 4%, higher than the 1.5% bank fee, according to TechCrunch. Bank purchases also have higher limits. Coinbase hopes to mitigate the impact of cryptocurrency volatility during the waiting period, as cryptocurrency values can suffer double-digit declines or increases during some five-day windows. Coinbase's instant purchases will initially be available to about 15,000 users, with a broader availability by the end of the year.

Strong pulse: The financial technology market had a strong second quarter in 2017, with total investment of $8.4 billion over 293 deals, or double the prior quarter, according to KPMG's Pulse of Fintech report. Private Equity and M&A funding drove the growth more than venture capital, which held steady during the quarter. Blockchain, B-to-B, artificial intelligence and "regtech" are all on upward swings in investment, according to KPMG. The Americas had the highest investments, partly due to the $4.6 billion buyout of Canada's DH Corp. Both Europe and the U.S. had strong growth with more than $2 billion in the quarter, according to KPMG.

From the Web

UK needs more joined-up approach to fintech ahead of Brexit
Reuters | Thu Oct 12, 2017 - The City of London called on Thursday for a more joined-up approach to nurturing financial technology firms in a fast-growing sector that now faces threats from Brexit. “Fintech” develops and offers personalised financial services like payments, loans and insurance via smartphones or the Internet, providing consumers with alternatives to high street banks. The City, which runs the “Square Mile” financial district of London, published a report on UK fintech on Thursday commissioned from consultants KPMG. It said that the fintech sector contributed 6.6 billion pounds to the British economy and employed 60,000 people in 2016, making it a leading global hub. Its main recommendation is for the government to set up a fintech “sector deal” or single policy vision to coordinate standards, support hiring of staff from outside Britain, and improve access to markets.

These countries have gone mostly cashless
Yahoo! Finance | Fri Oct 13, 2017 - They say that cash is king, but newer and more convenient payment methods are gunning for the crown. These days, more and more countries are adopting cashless payments, which includes credit card purchases, contactless payments, mobile banking apps and digital options like Apple Pay. To see which countries were adopting cashless the quickest, Forex, a global travel site, conducted a study comparing 20 of the world’s largest economies. In the report, Canada was singled out as the country most embracing cashless technology, which could be attributed to its population changing attitudes that began several years ago. A recent survey in May found that 50% of Canadians are ready to get rid of banknotes and coins. While a 2013 MasterCard survey found 90% of Canadian payments were made through noncash methods. While Canada took the top spot on this list, Sweden wasn’t far behind. The UK rounded out the top three, where the use of contactless payments is growing fast. After France, the United States ranked No. 5 on the list of countries adopting cashless payments.

Fed's Bullard warns bank regulators are 'complacent' over fintech risks
Reuters | Fri Oct 13, 2017 - U.S. banking regulators must accelerate efforts to address the risks posed by fintech companies to the banking sector which could be “eviscerated” by these innovative new players, St. Louis Fed President James Bullard said on Thursday. Growing competition from fintech players has become the “number one issue” for large financial firms and regulators are “fighting the last war” by focusing on tweaks to post-crisis financial rules, Bullard told Reuters in an interview. “We need to speed up our consideration of the fintech issues and think harder about what is the regulatory environment that is going to be appropriate. I think we have been complacent so far,” Bullard said. “That is the battleground for the next ten years. It is not the same as the battleground for the previous ten years.”

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