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Deutsche Börse and Google Cloud advancing in digital assets – Industry roundup: 13 February

Deutsche Börse and Google Cloud join forces to advance in digital assets

Deutsche Börse, with headquarters in Frankfurt, has partnered with Google Cloud to redesign its digital asset business over the next ten years. The exchange organization intends to improve, streamline and strengthen its cloud computing services.

Through Google Cloud’s infrastructure, data and analytic tools, Deutsche Börse aims to accelerate the development of its digital securities platform D7, drive innovation in its digital asset market operations and improve its data distribution and data use situations in the cloud. In addition, Deutsche Börse claims that its digital securities services platform, D7, demonstrates a new methodology for managing the end-to-end processing of digital securities tied to existing legacy infrastructures while enabling interconnectivity with brand-new ecosystems built on distributed ledger technology.

Google Cloud plans to support the D7 platform, which reportedly has an intelligent data analytics layer, through its BigQuery and Analytics Hub. Furthermore, through the improved infrastructure, Deutsche Börse Group intends to offer new programs, products and digital securities. In order to comply with regulatory obligations, the firm and Google Cloud plan to jointly invest in robust regulatory controls and built-in security mechanisms.

The collaboration is aimed at modernizing the exchange organization's digital asset business through the development of a cloud-native Digital Assets Business Platform that would reportedly combine decentralized and centralized financial systems to offer spot and derivatives products for cryptocurrencies. Both organizations also plan to cooperatively implement a data mesh for a number of the cloud-based data distribution and use cases for the Deutsche Börse Group.

Finzly, a fintech in payment technology, set to grant access to FedNow via its API connection

Finzly, a US-based banking and payments fintech firm, will reportedly grant banks and fintechs access to the new fast payment platform, FedNow, via its application programming interface (API). FedNow, which was developed by the Federal Reserve Banks and is currently scheduled to go live between May and July 2023, is expected to offer secure and efficient real-time payment services.

Financial institutions will reportedly be able integrate FedNow into their platform or application and create and experiment with transaction applications using Finzly’s API. All US payment rails, including Fed ACH, Fedwire, RTP, the FedNow service and SWIFT will reportedly be accessible through Finzly's API.

FedNow is expected to enable requests for payment, instant acknowledgements, requests for information and requests for the return of funds, said reports. Booshan Rengachari, CEO and Founder, Finzly, claims that FedNow will connect to insurance payouts, government benefits, healthcare payments, online commerce, subscriptions, point of sale, investing, lending and treasury. Rengachari added that Finzly's APIs and direct link to the FedNow service aims to hasten the implementation of rapid payments in a variety of applications.

Alibaba sells its holdings in India's Paytm for US $167 million, despite shares being up 23% from the year prior

The Alibaba Group of China has reportedly completed the sale of its remaining shares in Paytm, a digital payments firm in India, for approximately 13.78 billion rupees (US $167.14 million), stated recent stock exchange data. Reports indicate that the exit follows only days after Paytm reported its first operating profit as a publicly traded company for a quarter, nine months ahead of schedule.

Singapore’s e-commerce Pvt Ltd reportedly sold 21.4 million Paytm shares on Friday at 642.74 rupees each, a 9% discount to the previous day's close, noted the National Stock of India. The price of Paytm's shares fell by about 8%, settling at 650.55 rupees. However, it is still up by almost 23% year-to-date. The data also revealed that Morgan Stanley Asia (Singapore) Pte reportedly purchased 5.42 million Paytm shares for 640 rupees.

Additionally, through a block transaction valued at $125 million in January, Alibaba reportedly sold a 3.1% stake in the business. The Chinese company formerly owned 6.26% of Paytm, said reports. Paytm, which is supported by China's Ant Group and Japan's SoftBank Group Corp., has faced pressure to increase profitability. Since the initial listing in November 2021, the stock has reportedly dropped by almost 70%, decreasing by 60% in 2022. However, the Macquarie Research has reportedly upgraded the stock from "underperform" to "outperform", increasing its price target by approximately 80% (800 rupees).

The management's strategy for generating profits has undergone a significant adjustment shown by its most recent core profitability report. Macquarie analysts anticipate financial gains by fiscal year 2026 based on the current revenues and cash flow efficiencies. Reports indicate that there was no indication as to why Alibaba relinquished their ownership.

Paxos to cease production of new BUSD tokens for Binance

Paxos, a major regulated blockchain and tokenization infrastructure platform, has announced the termination of its partnership with Binance for the branded stablecoin BUSD. Effective 21 February, Paxos will reportedly cease issuing new BUSD tokens as directed by the New York Department of Financial Services (NYDFS) amid investigations.

Paxos Trust, which is a regulated organization governed by the NYDFS, is expected to continue to manage BUSD dollar reserves. Reports indicate that all current BUSD tokens will continue to be fully backed and redeemable through Paxos Trust through February 2024. Additionally, customers can expect to withdraw their money in USD and convert their BUSD tokens into Pax Dollar (USDP), another stablecoin created by Paxos, said reports.

FIS seeks to split the merchant business segment

FIS, a US-based banking and payments technology company, is reportedly exploring a corporate split, with plans to spin off its merchant division. The company’s merchant business, which reportedly also consists of Worldpay's payments software firm that was purchased for approximately US $43 billion in 2019, is also under consideration for the spin off.

Stephanie Ferris, the current CEO of FIS as of 1 January 2023, joined the company as a result of the Worldpay acquisition last February. Following a drop in the company's share price over 2022, the company has reportedly reduced its workforce significantly. Reports indicate that the company plans to announce the official split as soon as next week, estimating that the transition will take several months to finalize.

The decoupling of FIS's merchant solutions business will reportedly leave the company with its core banking processing systems business, which accounts for approximately 46% of its revenue, and its capital markets division, which accounts for approximately 25% of its revenue.

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