Uncle Sean's Update - 9/24/21

Happy Friday!!!
 
FinTech | Banking | Data – it’s what we do!  Make sure to sign up here to have the Uncle Sean Update sent direct to your inbox each week.  Here is the Uncle Sean Update for 9/24/21:
 

• Right off the bat – I want to give a special shout out and huge congratulations to First Women's Bank for their Grand Opening and Ribbon Cutting Ceremony this week!  OUSTANDING!!!!! 

 

• It’s Fed Week!!!!  Feel free to scroll down while I geek out – LOL!!!  Spoiler alert – nothing happened….  Again…..  LOL!!!    
  • However, Chairman Powell did state that if economic progress continues "broadly as expected, the Committee judges that a moderation in the pace of asset purchases may soon be warranted."  As always, CNBC has a good summary.
    • Basically, over the last six months we have talked about “when” we might begin to talk about the taper.  Then we talked about “talking about” a potential taper.  Now we are talking about a “potential taper”, but nothing is confirmed yet.  Got it!!!!
      • All kidding aside – I do love this fully transparent Fed.  Uncle Sean feels that it is good for the markets as a whole – kind of a soft spoken “Mister Rogers’ Neighborhood” type of approach to monetary policy; and they have been telling us for half a year exactly what they are going to do.  I dig it.  Sometimes boring is good!!!!
    • If you really want to get your super-geek on, you can check out the published Summary of Economic Projections, the 54 minute press conference video, and the 26 page written transcript.  Oh – and here is the official abbreviated FOMC Statement and Implementation Note.

 

• Late last Friday, Coinbase conceded to the SEC by announcing on their blog that they have abandoned the proposed Coinbase Lend product (crypto lending platform) and will continue to work towards “regulatory clarity for the crypto industry as a whole.”

 

• First National Bank of Omaha launches Buy Now Pay Later (BNPL) solution.

 

• American Express partners with Extend to enable virtual cards for U.S. SMB's.  Basically, existing Amex business customers can log in to Extend’s card app and create virtual cards in as little as 5 minutes.

 

• There was a lot of public commentary from regulatory heads this week reiterating the need for regulatory oversite in the crypto world:
  • Acting OCC head, Michael Hsu, gave a speech to the Blockchain Association earlier this week (you can read the full report here).  ICBA published a good summary referencing the following comments (I’m guessing Hsu isn’t a fan of DeFi):
    • “The cryptocurrency and decentralized finance sector is replete with scams, innovations that do little more than increase trading, and few solutions for the real economy.”
    • “Some of those who will be hurt in the crypto space are the least likely to be able to afford it.”
    • “Stablecoins and other crypto instruments pose systemic risks.”  YIKES – the dreaded “S” word….!!!!
    • “Financial innovation should be anchored in purpose.”
  • SEC Chairman Gary Gensler continues to reiterate his stance on the need for crypto regulations in this interview with Washington Post Live.
  • But wait – there’s more!!!!  The White House announced Saule Omarova as nominee for OCC head to replace Hsu.  Many media outlets, including this Washington Post article, label Omarova as an outspoken critic to Wall Street, big banks, and crypto.  Oh boy!  The upcoming confirmation hearings should be fun – LOL!!!!

 

• The NCUA liquidated C O Federal Credit Union after calling the small $2.4M CU insolvent with “no prospect for restoring viable operations.”  Really wasn’t much of a surprise as they were placed into conservatorship back on Jan 5th and have been insolvent (negative equity position) all year.

 

• Robinhood announced on their blog a new crypto wallet feature that they will be testing beginning next month.  Keep in mind that this allows for crypto transfers – not necessarily a non-custodial wallet that would allow users to hold crypto directly.  This Decrypt article gives a little more deeper dive; and shows Robinhood’s focus on Coinbase as competition.

 

• PayPal launched their "Super App" (I really don’t like that term by the way) which is a re-bundling of payments, savings, bnpl, cards, digital wallet, crypto, shopping (via the Honey acquisition), and more into their newly designed mobile app.

 

• Revolut obtains U.S. broker-dealer license and intends to offer commission-free (via PFOF) and fractional ownership stock trading within their app in the coming months.

 

• Prepaid2Cash launched a new feature allowing you to convert prepaid cards to bitcoin.

 

• Synctera announced the launch of Synctera Card and Synctera Fraud to its BaaS marketplace platform. 

 

• It’s a new world of counterparty risk…  Critical infrastructure certainly appears to be the primary target for recent ransomware attacks; and this definitely should be on your mind as we enter a new disturbing era of risk (Ag Bankers pay attention):
  • Crystal Valley Cooperative ransomware attack
  • New Cooperative ransomware attack

 

• Significant FinTech IPO activity this week:
  • Remitly commenced trading this week (Nasdaq: RELY) and raised $300M at an $8B valuation.
  • MoneyLion also commenced trading this week (NYSE: ML) following the completion of the SPAC merger with Fusion Acquisition Corp.
  • Toast (NYSE: TOST) raised about $870M in its IPO this week as shares rose over 50% to a $28B valuation.

 

• FinTech funding updates for the week:
  • PandaDoc (electronic document firm) raised an undisclosed Series C at a $1B Unicorn valuation. 
  • Airwallex (Australian fintech that recently launched cross-border payments in the US) raised $200M in Series E funding round at a $4B valuation with YoY revenue growth of 150% at 1H2021.
  • Stairwell (cybersecurity firm) raised $20M in Series A.
  • Ocrolus (automation platform that analyzes financial documents) raised $80M in Series C at a valuation in excess of $500M. 
  • Sunday (payments app for restaurant meals) raised $100M in Series A funding round.
  • Bilt Rewards (CC and rewards platform for rental payments) raised $60M in Seed funding (that’s huge for a seed round).

 
 
Random Uncle Sean Stuff:

• Fall is officially here as of 9/22 this week – and not a moment too soon as we were still flirting with 100 degree temps here in the Texas Hill Country as recent as Monday, 9/20.  Whew!!!
• Some weird but interesting numerical facts for you (I clearly need to get out of the house more often - LOL):
  • Most of us have a difficult time rationalizing the size of one billion….  For instance, one million seconds equals about 11.5 days whereas one billion seconds is almost 32 years.
  • Did you know that no number from 1 to 999 includes the letter “a” in its word form?  It’s not until you get to one thousand that the letter “a” presents itself.
• And a couple of quick Dad jokes:
  • Are Russian weddings referred to as Soviet Unions???
  • An astronaut’s favorite part of a computer is the ‘space bar’…
  • If a cop pulls over a U-Haul truck, did he just ‘bust a move’?  (https://www.youtube.com/watch?v=xy4FXhkm6Nw – you’re welcome LOL)  😊

 
 
Have a GREAT weekend and please stay safe!!!
 
Uncle Sean
 
 
Sometimes known as Sean Mayo – contact me directly for scope and pricing of custom reports / analysis projects at smayo@fedfis.com | 214-604-6961 – or you can contact FedFis Sales Team at 512-960-0911 | info@fedfis.com #FedFisHasTheData FedFis
 
FedFis, LLC disclaimer – The views and opinions of Uncle Sean are of his own and may not necessarily represent the views, endorsements, and/or opinions of FedFis, LLC – we all know he’s a little bit different; but that’s why we love him.
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