About 10,000 Cubans have turned to bitcoin and altcoins, including ethereum and dogecoin, to skirt around U.S. sanctions, according to a report from Deutsche Welle’s Spanish-language service, reported CryptoNews.
Cubans overseas use BitRemesas, a crypto exchange, to essentially transfer money to family in Cuba through a middleman, CryptoNews explained. They convert their fiat currency into cryptocurrency, which middlemen in Cuba then bid on and pay for in cash to the sellers’ family members in Cuba. The middleman gets a commission fee from the exchange, and BitRemesas takes a percentage as well.
Transfers, while high in volume, usually come in small amounts — $10 to $20 — according to CryptoNews.
In the last 10 years, Cubans have received nearly $30 billion in cash remittances, 90 percent coming from the U.S., according to CryptoNews, citing data from The Havana Consulting Group and Tech.
In other news, the Bank for International Settlements (BIS) announced Thursday (Dec. 3) that it completed a successful trial of Project Helvetia, which explored the feasibility of integrating a digital asset with a central bank currency.
The proof-of-concept was run in partnership with BIS’ Innovation Hub Swiss Centre, the Swiss National Bank and financial infrastructure operator SIX, according to the announcement.
Its goal was to examine whether a wholesale central bank digital currency (CBDC) could be issued on a digital asset platform and if the platform could be linked back to an existing wholesale payment system, the announcement stated.
BIS’ report noted that it used a wholesale CBDC, which is used by bank and other financial institutions, rather than a retail CBDC, which is for general use. It offers potential advantages but faces “major” policy hurdles, according to the announcement.
“Further work is needed; the next steps are to gain a better understanding of the practical complexities and policy implications of wholesale CBDC,” the announcement noted. “Different design choices that allow for trade-offs between risks and benefits need to be explored.”
The announcement stated that Project Helvetia was an experiment and BIS is not issuing a wholesale CBDC as of yet, rather “continued deliberations and experimentations” are needed.
“It is now crucial that we continue our journey incorporating our learnings and understanding the benefits to ensure that the added value for the financial industry will far outweigh the effort,” said Jos Dijsselhof, CEO of SIX, in the release.
Meanwhile, Hauck & Aufhauser, a private bank headquartered in Frankfurt, Germany, is launching a cryptocurrency fund next year.
The bank announced Thursday that the HAIC Digital Asset Fund will be available in January 2021 for institutional clients, according to CoinDesk, and it will hold bitcoin, ether, stellar and other cryptocurrencies.
Hauck & Aufhauser is one of the first private banks to launch a cryptocurrency fund for institutional and high-net-worth investors. The bank said it “has seen digital assets and cryptocurrencies become increasingly attractive to institutional investors,” CoinDesk reported.
Berlin-based Kapilendo will manage the fund’s secure asset storage. The fund has a minimum investment of 200,000 euros ($243,000), according to CoinDesk.