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on Payment Systems and Financial Technology |
| By: | Mr. Tanai Khiaonarong; Shanyuan Zheng |
| Abstract: | Cybersecurity and digital fraud are closely intertwined in financial services, as vulnerabilities in digital systems enable both institutional cyber incidents and fraud against users. This paper uses publicly available data to review and examine important trends underlying the growing concern of digital fraud. The results indicate that, across 20 industry sectors in 162 countries, cyber events in the financial sector accounted for about 10 percent over the past decade and were concentrated primarily in the banking and securities sectors. Cyber-enabled fraud has nearly tripled but remains underestimated due to underreporting and data gaps across jurisdictions. Credit transfers and credit cards dominate scam payments, with rising reports of payment fraud in some jurisdictions alongside increased crypto‑related cyber events and fraud. Industry studies also suggest that scam losses represent a higher share of gross domestic product in developing economies, while advanced economies tend to incur higher individual losses. Targeted regulatory and infrastructure measures have been taken to strengthen trust in digital finance in some jurisdictions. |
| Keywords: | Banks; cyber events; cyber-enabled fraud; digital fraud; financial sector; payment fraud |
| Date: | 2026–03–27 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/062 |
| By: | Daniel Pastorek (Faculty of Business and Economics, Mendel University in Brno, Czech Republic); Peter Albrecht (Faculty of Business and Economics, Mendel University in Brno, Czech Republic) |
| Abstract: | We study how post-trade settlement frictions introduced by spot ETFs reshape cryptocurrency market dynamics. Unlike crypto markets with near-instant delivery, crypto ETF trading is governed by an equity-style clearing and settlement clock, effectively importing a second timing regime into cryptocurrency markets. Using daily ETF failures-to-deliver (FTDs) data, securities-lending conditions, and close-aligned spot prices from ETF inception until 2025, we show that FTDs act as an intertemporal liquidity buffer. Local projections indicate that unexpected increases in FTD intensity do not raise contemporaneous spot volatility on the trade date. Instead, volatility materializes around the regulatory settlement date and spills over into the next session to some extent. In a competing-shocks framework, this response centered around the settlement date remains distinct from standard volatility shocks, which load immediately and mean-revert. Panel regressions further show that FTDs arise systematically when lending constraints bind. Finally, higher FTDs coincide with larger ETF spot tracking errors, consistent with temporary impairments in arbitrage. Overall, spot crypto ETFs import traditional settlement frictions into markets, where these frictions did not occur previously. It reallocates volatility over time and intermittently weakens price parity. |
| Keywords: | Bitcoin, Ethereum, ETFs, Volatility, Market dynamics, FTDs, Settlement frictions |
| JEL: | G11 G12 G14 G23 C58 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:men:wpaper:109_2026 |
| By: | Manuel Mueller-Frank; Minghao Pan; Omer Tamuz |
| Abstract: | The value of proof-of-work cryptocurrencies critically depends on miners having incentives to follow the protocol. However, the Bitcoin mining protocol proposed by Nakamoto (2008) and implemented in practice is well known not to constitute an equilibrium: Eyal and Sirer (2018) construct a profitable deviation called ``selfish mining'' which relies on strategically delaying disclosure of newly mined blocks rather than publishing them immediately. We propose inertial mining, a novel mining protocol. When miners follow inertial mining, they produce the outcome intended by Nakamoto, i.e., a single longest chain. But unlike the Bitcoin mining protocol, inertial mining constitutes an equilibrium (assuming no miner controls more than half of the mining power). Indeed, neither selfish mining nor any other deviation is profitable. Furthermore, inertial mining only changes miners' behavior in the event of off-path forks, and can be implemented in Bitcoin without any changes to its consensus mechanism or blockchain architecture. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.06092 |
| By: | Hasret Ozan Sevim; Christof Ferreira Torres |
| Abstract: | Decentralized finance introduces new business models and use cases as part of digital finance. Restaking has recently emerged as a transformative mechanism in DeFi, promising extra yields but introducing complex and interconnected risks. The paper monitors the current restaking landscape, empirically analyzes the revenue drivers of a liquid restaking protocol, and conducts a technical investigation on the emitted risk arising from the interconnection between liquid restaking and other protocols. The revenue dynamics of Renzo Protocol are analyzed by employing an OLS regression model, Granger-causality and random forest feature importance tests. Our results identify that revenue is primarily predicted by the value locked in the underlying EigenLayer ecosystem, the yield of Renzo protocol's liquid restaking token and the multi-blockchain expansion of that token. The multi-blockchain expansion of the liquid restaking token presents a double-edged sword: bridging to other networks is crucial for user adoption, but it adds the bridge risks to the existing risks of restaking. We investigate the cross-contamination risk between different DeFi services and the liquid restaking protocol. By mapping the asset flow across the decentralized finance ecosystem, it is detected that the bridge risk of the current size of Renzo's liquid-restaking assets does not impose a systemic risk on the current restaking and staking ecosystem. To address the potential consequences of the emphasized interconnection risks, we introduce two hypothetical scenarios and a stress test, assuming a large number of compromised liquid restaking tokens and a smart contract logic failure in a DeFi protocol. Considering the overall liquid-restaking protocols and the growing interconnection, this analysis requires further work to explore the growing complexities. |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.03274 |
| By: | E. Bonhoure (Kedge BS - Kedge Business School); R. Bawack (Audencia Business School) |
| Abstract: | Despite extensive research linking financial inclusion to sustainable development goals (SDGs), a holistic review of this body of knowledge is still lacking. We used bibliometric methods to identify progress and gaps in this research stream to fill this gap. We propose a holistic conceptual framework of financial inclusion, decomposed into five conceptual blocks: digital and non-digital finance, financial services, and individual-level and systemic factors. The results show that current financial inclusion literature contributes mainly to 6 of the 17 SDGs, with the rest being relatively under-researched. |
| Keywords: | financial inclusion, sustainable development goals, bibliometric, review, digital finance |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04828293 |
| By: | Wissem Ajili Ben Youssef (Métis Lab EM Normandie - EM Normandie - École de Management de Normandie = EM Normandie Business School); Najla Bouebdallah (Excelia Group | La Rochelle Business School); Meriem El Bouhali (ESLSCA Business School - École Supérieure Libre des Sciences Commerciales Appliquées) |
| Abstract: | This study aims to identify factors affecting auditors' intention to use blockchain among the Big Four firms. The research proposes an extended technology acceptance model by integrating the technology acceptance model (TAM) with innovation diffusion theory (IDT). A quantitative approach was employed, utilizing questionnaires to collect data from 130 auditors working at the Big Four. The data were analyzed using partial least squares structural equation modeling (PLS-SEM). The results indicate that auditors' intention to use blockchain is significantly influenced by perceived usefulness (PU) and perceived ease of use (PEOU). The study highlights relative advantage and trialability as the most important attributes of IDT affecting auditors' perceived usefulness and ease of use of blockchain. Observability has a significant positive relationship with perceived ease of use but a nonsignificant correlation with perceived usefulness. However, complexity is statistically insignificant in explaining perceived ease of use. Finally, access to big data significantly enhances auditors' perception of the usefulness of blockchain technology. Therefore, our results recommend communication strategies and training policies to enhance the perceived usefulness of blockchain technology in auditing. Reducing uncertainty about emerging technologies, primarily through standardization, will also improve auditors' intention to use blockchain. |
| Keywords: | Audit, Blockchain, Technology acceptance model, Innovation diffusion theory, Big Four |
| Date: | 2025–06–23 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05568241 |
| By: | Kyungmin Kim; Romina Ruprecht; Mary-Frances Styczynski |
| Abstract: | In July 2025, the U.S. Congress passed the Genius Act, which established the regulatory framework for payment stablecoins. The law defines what an authorized payment stablecoin issuer is and how it will be regulated. |
| Date: | 2026–03–30 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedgfn:102996 |
| By: | Hasret Ozan Sevim |
| Abstract: | This paper emphasizes the critical role of interoperability in enabling efficient and secure communication for the fragmented distributed ledger ecosystem, particularly within on-chain finance. The purpose of this study is to streamline and accelerate empirical research on the intersection of cross-chain interoperability solutions and their impact within on-chain finance. The analysis examines the relationship between financial use and interoperability while comparing the properties of novel cross-chain interoperability protocols (LayerZero, Wormhole, Connext, Chainlink Cross-Chain Interoperability Protocol, Circle Cross-chain Transfer Protocol, Hop Protocol, Across, Polkadot, and Cosmos), focusing on their design, mechanisms, consensus, and limitations. To encourage further empirical study, the paper proposes a set of network metrics and sample statistical models and provides a framework for evaluating the performance and financial implications of interoperability solutions. |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2603.21797 |
| By: | Yuanzhe Zhang; Yuexin Xiang; Yuchen Lei; Qin Wang; Tian Qiu; Yujing Sun; Spiridon Zarkov; Tsz Hon Yuen; Andreas Deppeler; Jiangshan Yu; Kwok-Yan Lam |
| Abstract: | Agentic AI rivals human capabilities across a wide range of domains. Looking ahead, it is foreseeable that AI agents will autonomously handle complex workflows and interactions. Early prototypes of this paradigm are emerging, e.g., OpenClaw and Moltbook, signaling a shift toward Agent-to-Agent (A2A) ecosystems. However, despite these promising blueprints, critical trust and security challenges remain, particularly in scenarios involving financial transactions. Ensuring secure and reliable payment mechanisms between unknown and untrusted agents is crucial to complete a fully functional and trustworthy A2A ecosystem. Although blockchain-based infrastructures provide a natural foundation for this setting, via programmable settlement, transparent accounting, and open interoperability, trust and security challenges have not yet been fully addressed. Hence, for the first time, we systematize blockchain-based A2A payments, e.g., X402, with a four-stage lifecycle: discovery, authorization, execution, and accounting. We categorize representative designs at each stage and identify key challenges, including weak intent binding, misuse under valid authorization, payment-service decoupling, and limited accountability. We highlight future directions for strengthening cross-stage consistency, enabling behavior-aware control, and supporting compositional payment workflows across agents and systems. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.03733 |
| By: | Mariam El Harras (ENCGT - Ecole Nationale de Commerce et de Gestion de Tanger - UAE - Abdelmalek Essaadi University [Tétouan] = Université Abdelmalek Essaadi [Tétouan]) |
| Abstract: | Regulatory technology (RegTech) is transforming financial compliance by integrating advanced information technologies to strengthen anti-money laundering and countering the financing of terrorism (AML-CFT) frameworks. Recent literature suggests that such technologies represent more than just an efficiency tool; they mark a paradigm shift in regulation and the evolution of financial oversight (Kurum, 2023). This paper aims to provide a narrative review of recent RegTech applications in financial crime prevention, with a focus on key compliance domains. A structured literature review was conducted to examine publications between 2020 and 2024 with a thematic synthesis of findings related to customer due diligence (CDD) and know your customer (KYC), transaction monitoring, regulatory reporting and compliance automation, information sharing and cross-border cooperation, as well as cost efficiency. Findings reveal that RegTech solutions give financial institutions more responsibility for detecting and managing financial crime risks, making them more active players in compliance processes traditionally overseen by regulators. The combined use of technologies such as artificial intelligence (AI), blockchain, and big data also generates synergistic effects that improve compliance outcomes beyond what these technologies achieve individually. This demonstrates the strategic relevance of integrated RegTech approaches. |
| Keywords: | Compliance Automation, Financial Crime Detection, Systematic Narrative Literature Review, AML-CFT, O33 RegTech, K22, G28, JEL Classification: E44, JEL Classification: E44 G28 K22 O33 RegTech AML-CFT Compliance Automation Financial Crime Detection Systematic Narrative Literature Review |
| Date: | 2025–08–07 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05324285 |
| By: | Estrin, Saul; Meyer, Klaus; Kretschmer, Tobias |
| Abstract: | Competition policy establishes the institutional framework for competitive dynamics in market economies. Recently, the relevance and impact of traditional competition policy has been challenged by the rise of the digital economy, where we see a small number of large platform firms, frequent takeovers and mergers, and the potential for using customer data to join and dominate previously separate markets. We provide a framework to explain the basis for contemporary competition policy, and explore implications for company strategy within and beyond the digital sector. Some of the most radical thinking about how competition policy might address the challenge of the digital economy originates from Europe, itself a major market for technology firms. We illustrate this thinking with exemplars from the practice of the EU Commission. Although existing competition policy can provide a basis for addressing monopolistic abuses in digital markets, practices are shifting to address novel sources of market power, including the governance architecture of digital platform firms and their ecosystems, the transferability of personal data, and the interoperability of systems and standards. We consider implications for policymakers. Corporate strategists must also understand how the evolving competition policy framework is impacting competitive dynamics of both platform operator and platform complementing entrepreneurs. |
| Keywords: | European competition policy; mergers and aquisitions; abuse of monopoly power; platforms; digital sector; personal data |
| JEL: | J50 J1 |
| Date: | 2025–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:127060 |
| By: | Marta Diogo António; João Carlos Lopes |
| Abstract: | This paper addresses the topic of digital trade. Its central objective is to analyze the evolution of e-Commerce in recent years in Portugal and the European Union, and to understand how companies and consumers act in relation to this topic. The research is based on interviews with professionals linked to the sector and a survey conducted among Portuguese consumers, allowing a more comprehensive understanding of the digital world. The study highlights the main trends associated with consumption, the obstacles faced by companies, as well as the opportunities brought about by digital transformation. The results obtained contribute to the discussion about Portugal's position in the European landscape regarding digital commerce and offer valid recommendations for policymakers and economic agents. |
| Keywords: | e-Commerce; Digital transformation; Business strategies; Consumer behavior; Portugal. |
| JEL: | D12 D22 L81 |
| Date: | 2026–02 |
| URL: | https://d.repec.org/n?u=RePEc:ise:remwps:wp04092026 |
| By: | Michael S. Barr |
| Date: | 2026–03–31 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedgsq:102982 |
| By: | Iñaki Aldasoro; Paula Beltran; Federico Grinberg |
| Abstract: | Using data on four USD-pegged stablecoins and 27 fiat currencies, this paper documents spillovers from stablecoin-based foreign exchange (FX) to traditional FX markets. We document a gap between the cost of acquiring dollars via stablecoins and via the spot FX market (parity deviations). To establish a causal link between stablecoin flows and FX markets, we use a granular instrumental variable that exploits idiosyncratic shocks to stablecoin net inflows in other currencies. Our estimates indicate that a 1% exogenous increase in net stablecoin inflows raises parity deviations by 40 basis points, depreciates the local currency, and widens the dollar premium in synthetic funding markets (covered interest parity (CIP) deviations). A model of constrained arbitrage rationalizes these findings and provides structural foundations for the identification strategy. Counterfactual simulations show that halving cross-market frictions would attenuate CIP spillovers by roughly one-half and cut exchange rate effects by nearly one-third. A dynamic extension that closely matches the empirical impulse responses shows that spillovers grow disproportionately when intermediaries suffer losses, as depleted capital reduces their capacity to absorb further shocks. Our results establish stablecoins as an emerging segment of global currency markets with direct implications for financial stability. |
| Keywords: | Stablecoins; foreign exchange; market segmentation; capital flows; arbitrage |
| Date: | 2026–03–27 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/056 |
| By: | Alisa DiCaprio; Mr. Marcello Miccoli; Philip Montalvao; Andrew Usher; Jeanne Verrier |
| Abstract: | Cross-border payments face multiple challenges that may result in slow transaction speed, particularly at the beneficiary leg, which constitutes the last mile of the payment process. This paper measures whether capital controls are associated with slower cross-border payments, using two novel cross-country datasets derived from microeconomic data. While it does not establish causality, preliminary evidence suggests that the effect is statistically significant and sizeable. A one-standard-deviation increase in the Financial Account Restriction Index, our measure of capital controls, is associated with a delay of 4 to 8 hours at the beneficiary leg. The effect is stronger in Emerging and Developing Economies, and heterogeneous across geographic regions. |
| Keywords: | Cross-Border Payments; Capital Flow Management |
| Date: | 2026–04–10 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/068 |
| By: | Alex Günsberg; Camelia M. Kuhnen |
| Abstract: | Online loan marketplaces are changing consumer lending. Here we investigate consumer behavior in these markets with near-zero search costs. Using administrative data on 730, 000 applications, 750, 000 offers, and 200, 000 individuals, together with credit registry records, we document four facts. First, substantial within-applicant dispersion in offered terms makes search highly valuable. Second, marketplace nudges mitigate choice complexity. Third, applicants search significantly, applying repeatedly, asking for different terms, and rejecting offers, in ways consistent with their creditworthiness. Fourth, dynamic adverse selection constrains search, as lenders penalize repeat applicants. Our findings highlight trade-offs between informational gains from search, and reputational and cognitive costs. |
| JEL: | G21 G23 G41 G51 |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35024 |
| By: | Yoko KONISHI; TakashiKUBO |
| Abstract: | This study examines how small and medium-sized enterprises (SMEs) in Japan adopted generative artificial intelligence (AI) during the early phase of its diffusion. Generative AI spread rapidly after late 2022, yet little is known about how firms actually initiated adoption. Using monthly industry-level data constructed from cloud accounting service logs, we analyze actual payment records for generative AI services from 2022 to 2025, covering approximately 87, 000 SMEs. We find that initial adoption was highly synchronized across industries, with a sharp increase in early 2023 following major technological releases. However, subsequent differences in adoption levels are primarily associated with industry characteristics and pre-existing digital technology usage structures. Sectors with more advanced digital infrastructures exhibit higher sustained adoption rates. By documenting real adoption behavior at its formative stage, this study provides baseline evidence for future evaluations of economic impacts and the design of SME technology policies. |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:eti:rdpsjp:26018 |
| By: | Junliang Luo; Xihan Xiong; Zonglun Li; Hong Kang; Xue Liu; William J Knottenbelt; Katrin Tinn |
| Abstract: | The global financial architecture is undergoing a shift from intermediary centric-settlement to programmable infrastructure, to transmute trillions in static illiquid capital into active, high-velocity instruments. We argue that Real World Asset (RWA) tokenization represents a conceptual evolution beyond mere digitization, converting passive ledger entries into programmable economic agents capable of autonomous settlement and algorithmic collateralization. However, achieving such seamless capital efficiency necessitates resolving the fundamental friction between deterministic on-chain code and probabilistic off-chain reality, navigating the oracle problem and jurisdictional interoperability. This systematization of knowledge presents a taxonomy for the RWA lifecycle and deconstructs the multi-layered architecture, spanning legal custody, technical standards, and cryptoeconomic valuation, required to enforce off-chain rights within on-chain environments. We study systemic constraints such as latency and regulatory fragmentation through a comparative overview of sovereign debt, private credit, and real estate protocols, complemented by an empirical case study of on-chain U.S. Treasuries. We synthesize these findings to propose a prognostic outlook, positing that while asset tokenization provides a transitional bridge, it is not necessarily the inevitable shift compared to the emergence of unified, programmable ledgers. |
| Date: | 2026–04 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2604.06608 |
| By: | Rachid Awad; Mr. Luc Riedweg |
| Abstract: | The paper explores the role of banking supervisors with respect to banks’ implementation of IFRS 9. It discusses: the benefits associated with IFRS 9 as well as the main challenges from banking soundness and risk management perspectives; the role that banking supervisors should play in achieving a robust implementation of IFRS 9; and steps that can be taken to implement IFRS 9 in a proportionate and sound manner while minimizing procyclicality. It argues that authorities should consider introducing a transition period to provide sufficient preparation time for banks and banking supervisors, with an appropriate sequencing of key tasks to be completed; IFRS 9 should be implemented in a proportionate and sound manner; and regulatory provisioning systems used as prudential backstop should be maintained until supervisors have gained sufficient experience with IFRS 9. |
| Keywords: | financial stability; banking supervision; provisioning; procyclicality; proportionality; International Financial Reporting Standards; credit; credit risk; loans |
| Date: | 2026–03–27 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imftnm:2026/004 |
| By: | Edmond Baranès (Unknown); Ulrich Hege (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - Comue de Toulouse - Communauté d'universités et établissements de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); Jin-Hyuk Kim (Unknown) |
| Abstract: | We present a stylized model of three entrepreneurial financing methods based on two tradeoffs. First, token financing and crowdfunding reveal consumer-investors' demand for the product prior to investment, but upfront purchase weakens the entrepreneur's incentive to deliver. Second, token financing permits a bubble component in token value, but reduces consumer surplus. |
| Keywords: | crowdfunding, entrepreneurial financing, initial coin offering, token regulation, ,financement participatif, financement des entreprises, offre initiale de jetons, réglementation des jetons, jeton utilitaire, utility token |
| Date: | 2026–03–30 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05578939 |