Could it be the end of Bitcoin transactions in Europe?

The European Commission (EC) is set to bring the anonymous transactions in virtual currencies to an end to help tracking of terror groups’ funding. To foster this, the Commission published an action plan that will help reinforce the fight against terrorism financing yesterday. It outlined information on how criminals are looking for new ways quickly that provide lower detection risk of moving their money.

There is no evidence in the plan that points out to finance terrorism being financed by virtual currencies. However, the Commission is certain that there is a possibility and feels that it is in a position to contemplate regulation as one of the continuing efforts to bring terror attacks to an end.

The plan requires the platforms that deal with virtual currency exchange to operate under the capacity of the European Anti-money Laundering Directive so as to ensure that exchanges can reveal who accessed their services and when they were used. According to the action plan, the Commission will as well inspect whether it is viable to include wallet providers of virtual currency.

Bitcoinistas should not feel like they have been left out by the EC since the action plan requires a re-think of how and when to reveal pre-loaded credit cards’ users, without minimising their utility. This is because many of these users are poor who find these cards useful instruments in financial matters because they work as credit cards without necessarily requiring the card holders to be credit-worthy. Consequently, a central register of bank accounts, as well as account holders, is required to be set up in the entire European Union member states.

Meticulous consideration of all exchanges between states and EU members that are known to be great points for money-laundering has not been left out in the action plan as well. About many government responses to situations raised by technologies, this issue remains of value, but pointless at the same time since virtual currencies create a virtue of privacy.

Bitcoin in its advice says, “To defend your privacy, there is need to utilise a new Bitcoin address whenever you accept a new payment. Also, you can make use of several wallets for various functions. In doing this, you will isolate all your exchanges and associating them with each other will not be possible. Those who send you money cannot view your other Bitcoin addresses and what you use them for. ”

Many virtual currency transactions are beyond EU’s reach in such a way that operators will find ways of cashing in cryptocurrencies within Europe. Cryptocurrencies do not allow terrorists to access funds.

Is the Foreign exchange market shrinking?

It took the foreign exchange market decades of build up as well as globalization and deregulation measures to earn the title of the largest financial market there is. However, as much as the forex market cannot get relinquished easily, it appears as if its glory days may just be over.

The situation has been accredited to the shrinking in size of both the market volumes as well the number of employees who work in the currency departments of most major banks. Other factors contributing to the same fact include banks implementing stringent regulations, a downward trend in; the market boom, as well as global economy and growth.

According to statistics, in the last three years, the total number of market traders employed in Europe’s top ten currency exchange banks has dipped by 30 per cent. Based on figures provided by the New York Federal Reserve and the Bank of England, as of last month, the trading volumes have reduced to a three-year low.

According to Coalition; a financial data analytics firm, 332 people were employed by the top ten FX banks that operate in Europe. However, in 2012, 475 people were employed by the same institutions, meaning that in 2012 the number of individuals employed by the banks was 30% higher than in 2015.

According to a central banker, towards the end of the year in 2014, the global forex activity in the market was at a peak. During this period, the average daily volumes amounted to about $6 trillion a day. According to data provided by CLS Bank, the average daily volumes in January amounted to $4.8 trillion. This figure indicates a drop by 9% from the previous year and a far cry from the peak average of $6 trillion.

The downward trend has also been attributed to regulatory changes that took place after the global financial crisis which has resulted in a reduction in the ability and willingness of traders to take risks.

According to Howard Tai, a senior analyst at Aite Group, the regulations carried a psychological effect on the market players and thus traders are o longer as aggressive as they used to be.

Suppressed market volatility has also been blamed for the dwindling average market volumes. A fall in spot volumes and reduced demand for derivative products; for example, currency options, based on the fact that if there is no movement of money in the market, them the demand for hedge quite minimal.

According to the managing director of Chapdelain FX, Douglas Borthwick, there is little volatility due to zero interest rates combined with a global environment that appears to be very dovish. Thus, since the volatility is low then the total average volumes are also low.

British pound drops against the dollar

Amidst campaigns to determine the fate of Britain’s membership of the European Union, the pound has witnessed its sharpest decline in value since the 2008 financial crises creating a political basket of gold on both sides of the campaign.

In the four days that followed London’s Mayor, Boris Johnson, declare to support Britain’s exit from the EU; a defiance to the Prime Minister, David Cameron, the pound dropped 5cents to settle a seven-year low against the US dollar in all money exchange outlets.

The central question in the hearts of many people is whether they will be richer or poorer should Britain vote to exit. According to Cameron, Britain dropping out of the EU is like taking a leap in the dark. Meanwhile, HSBC and Goldman Sachs have cautioned that upon leaving the EU the pound could subsequently lose an extra fifth of its value.

Pro-Europeans are advising that the current hiccup in the currency is a sign of what could happen in the future should Britain decide to leave. However, the opposition has declared that voters would not give in to scaremongering carried out by independent banks that had warned of the repercussions of Britain withdrawing from the EU in the 1990’s.

According to Richard Trice, who is a supporter of the Leave.EU campaign, multinational banks are seeking to create volatility as it suits them in terms of profitability.

In the last week of February, most money exchange firms quoted the Sterling averaged at $1.3910 which was a seven-year low and heading for its worst weekly performance ever since 2009.

Following the poor performance towards the end of February, the Foreign Secretary, Philip Hammond, commented on the matter term it as a warning of the impact to come for leaving the EU. Hammond told parliament that voting to leave would create an uncertainty of the future which would further generate an adverse reaction in the financial markets.

According to the campaign supporting Britain to remain in the EU, the sterling pound could lose up to twenty percent more in value should the country decide to exit. In a nutshell, the exit would, therefore, mean that the prices of petrol, shopping, household gadgets and holidays would rise.

Britain’s relationship with its EU counterparts has been centralized on its currencies fate as well as the fact that London dominates the $5.3 trillion a day worldwide Forex market. Since the pound is one of the oldest currencies still in use, it has been an accepted symbol of Britain’s imposing might as well as a British exceptionalism.

The £ sign is utilized by the UK’s Independence Party as part of the emblem, and the Prime Minister David Cameron praised his European deal assuring it provided security for the currency. In a statement made by Cameron in regards to the deal, he said that not only had the deal permanently protected the pound and the country’s right to use it, but also ensured that Britain would not be discriminated. However, Cameron has not made any public statement regarding the fall of the sterling pound.

According to the deputy director of ‘Britain Stronger in Europe’ Lucy Thomas, the unpleasantness of the depreciating currency underlined the dangers of the country voting to leave the EU. Furthermore, the economic security of Britain would be put to risk not to mention that family finances would suffer a negative impact as well. Thomas also added that it was imperative for Britain to retain access to Europe’s 500 million customer market; just the possibility of leaving the EU has sparked a depreciation of the pound.

According to the CEO of Merlin Entertainment, Nick Varney, a weak pound would have a good effect on the British industry because it would be good for exports as well as tourism. He also added that should Britain make an exit, and the pound falls further in value, it didn’t strike him as an adverse outcome but rather a good one.

Is it now time to buy your holiday cash

Following the plummeting value of the pound, holiday makers are flooding money exchange outlets to stockpiling Euros for their holiday money amid fears of further devaluation of the pound. The possibility of Britain pulling out of the European Union has lead to a decrease in the purchasing power of the pound in other countries.

As a result, currency brokers such as Asda Money and Hifx have received overwhelming orders to supply holiday cash to families that are speculating the possibility of costs rising before Easter or summer breaks.

In comparison to the end of February 2015, 43% more Euros got exchanged by Britain’s largest currency seller, The Post Office, in the last few weeks alone. According to The Post Office, it has been selling twice the average amount of Euros for the month of March.

According to Darren Kilner, from FairFX, the past weeks have been busier than usual as customers are concerned that the EU referendum might have an impact on their holiday plans.

Just a few days ago, the Sterling pound dipped against the dollar to its lowest point since the 2009 financial crisis. One year ago, one pound exchanged for $1.51, but the devaluation has brought the exchange rate down to $1.35 per pound.

To the Euro, the pound has depreciated by 9%, and it is now trading at £1 for €1.23; a drop from €1.40 in July last year with experts predicting the collapse of the currency as the EU referendum takes place on June 23.

HSBC estimated the pound could fall further by 20% should Britain vote to leave the EU. From another point of view, USB says the pound could eventually equalize with Euro in terms of value. According to Panmure Gordon stock brokerage’s financial commentator David Buik, talk of the pound falling to a point of parity with the Euro is a bit extreme; however, it is possible that an exchange rate of €1.15 will be reached. He further added that he expected the pound to experience a sharp rise in the future.

According to a panel of neutral experts, it is advisable to visit a money exchange and buy some of your holiday money at the moment.

According to Justin Urquhart, founder of 7 Investment Management, the uncertainty of the British currency will continue to worsen until the countries stand in the EU referendum id established. He added that since it is not possible to know which way a currency will go, it would be advisable to get at least half of your holiday money now. He further stated that he could not see why the pound should gain value.

David Black, the founder of DJB Research; a financial research firm, says the currency’s exchange rate is going to fluctuate in the coming months and advises holidaymakers to estimate how much they are willing to spend and get at least half of the money now.

However, the director of Wealth Club investments, Ben Yearsley advises that should Britain gesture it wants to leave the EU the pound could further depreciate with the reverse also being the case. Thus, he does not rush to get the holiday money just yet.

Man steals £40,000 from Bureau-de-change

If you thought the era of brazen, out-in-the-open robbery was a thing of the past, think again. Recently, it was reported that a con man stole £40,000 from the safe of a supermarket in Trafford Park, Greater Manchester and simply walked out of the store without being noticed. This shocking act of theft was committed with skill and a highly refined sense of timing, ac-cording to sources. When asked to describe the robbery, an informed representative stated, “…He apparently wore a glove, knew the code for the safe, punched it in and was able to empty it. At one point a senior member of the Asda staff walked past while he was in the ki-osk and even spoke to him, but he just kept up the pretense as cool as you like.”

So, who was this man, and how was he able to successfully pull off what should have been an incredibly difficult task? The fact that the individual’s identity and whereabouts are still unknown is bad enough, and yet, perhaps even more troubling is the fact that no explanation currently exists as to how he knew the code for the safe within the bureau de change.

Whether or not this suspect will be caught is, of course, important, but this story also provides us with a far more interesting revelation, that being the idea that many of our preconceptions regarding the security and, ultimately, legitimacy of neighborhood bureau de change locations are, perhaps, incorrect. Given the fact that the world of currency exchange has recently been rocked by allegations of counterfeit currency selling in the UK in a separate, unrelated incident, many individuals have begun to ask themselves whether or not their desire to exchange large sums of money for international travel or business at their local ex-change venue is, indeed, the right idea.

This is not to say, of course, that sweeping reform or oversight is needed, but rather that specific problems have emerged in recent months that do need to be addressed by those in a position to remedy them. In time, such direct action will help ensure that the future of cur-rency exchange is not fraught with underhanded, illegitimate dealings and accusations of illegal behavior.

More information about this specific act of theft is likely to be provided in upcoming weeks as police continue their search for the culprit in question.

British Currency Taking a Hit

Those who make a point of following currency exchangexchange-related news will likely not need to be told that the British Pound has not fared well in recent times. In fact, it’s fair to say that little good news can be found related to the performance of the Pound recently. A series of repetitive, volatile swings in pricing earlier in the month have left investors somewhat rattled. The Pound has consistently performed poorly against the dollar recently, mainly due to strong economic indicators in the US and continued instability throughout the European Union and the United Kingdom at large.

That being said, it is also important to note that the British pound has been unable to hold value against the EU dollar as well. Earlier in April, the pound was unable to shake investor worry and continued to slip well below expectations. This continued poor performance resulted in a chain reaction of slides against global currencies, including the Hong Kong Dollar and the NZ Dollar. The pound also performed poorly against the Australian Dollar.

Although the month began in a rather turbulent fashion, recent news is far more encouraging. Many analysts are now confident that the downward trajectory of the British Pound has been all but abated. Also, it is important to note that dubious signals related to the strength of the US domestic economy have caused the American Dollar to slide relative to the pound. Neither nation, it seems, has much to be thankful for when it comes to long-term optimism. However, it will be quite interesting to observe precisely how the looming threat of Brexit continues to influence the value of the Pound. After last year’s rather mundane period of sedentary activity, recent global politics have once again swung FX markets into action and ensured that traders are on they toes. For those who are considering whether or not now is, indeed, the time to reconsider investment in the Pound, a growing number of experts are adopting buy positions on the currency. The outcomes of big bets on the currency exchange will likely be revealed in the upcoming weeks as the currency moves towards stability.

Euros to Pounds plummeting, is it worth converting cash now?

The possibility of Brexit, no matter how dim or vague, has, for all intents and purposes, created concrete and dramatic fluctuations in the UK economy to date. Although the likelihood of the Brexit movement succeeding has become less plausible in recent months, the turmoil created by this vote has sent shockwaves through the global currency markets, particularly with respect to the British Pound’s relationship to the Euro dollar.

According to recent data culled from the fx markets, the Pound is performing quite poorly against the Euro. With this in mind, a growing number of British residents are flocking to currency exchange centers in order to exchange their Pounds for Euro Dollars prior to summer vacations and other holiday outings in order to ensure that they can maintain their purchasing power in the event of further declines in their domestic currency. According to statistics released by the Post Office, the central source of currency exchange in the UK, there has been a 43% increase in the sale of Euros at this time compared to this point last year. The continued fear of economic and political turmoil has sent Pound / Euro exchange to nearly double their normal frequency at multiple points in the past few months.

Unfortunately, these fears are not without their real-world manifestations. Recently, the Pound fell to a record low against the US dollar, dipping to exchange rates which had not been seen since the height of the global financial crisis in 2009. Additionally, the Pound appears to have fallen up to 9% against the Euro Dollar, leading some experts to believe that a more staggering collapse of the Pound could be imminent as the Brexit vote nears. Adding fuel to the fire, HSBC has recently announced that their analysts have predicted that the value of the Pound may fall up to 20% more if the UK were, indeed, to leave the EU behind. Such pricing fluctuations would have staggering consequences in the UK, with import and export activities being severely disrupted.

In a prepared statement regarding the issue of GBP volatility, Justin Urquhart-Stewart, a representative of noted investing firm 7 Investment Management, stated, “Sterling is going to be as soggy as the British weather, and until the EU referendum is out of the way, the uncertainty is going to get worse.….You never know which way currency is going to go, but if you have a holiday booked I would get at least half of your currency now; maybe even more. I cannot see why the pound will get any stronger.”

There is, of course, no method by which the fine details of the fx markets can be accurately predicted for the upcoming months. Suffice to say, however, that there is a growing consensus that the Pound will, for better or worse, face turbulent waters for the rest of this year. Because of this, many financial advisors are recommending that those individuals seeking to enjoy a European or international holiday abroad this summer would do well to begin withdrawing the cash they plan on using during their travels now. According to David Black, the founder of noted financial analysis firm DJB Research, “If you know you are definitely going away this summer and you have the cash to spare, then it might be an idea to work out how much spending money you will need and get half now”.

More information regarding the fate of the Pound will likely reveal itself in the upcoming months. Until then, those individuals who do plan on using their finances for international activities are advised to keep a watchful eye on the fx rates as they fluctuate. Although a rally in the Pound has been predicted in the event of a “stay” vote during Brexit, it is far too early to determine whether or not this will, indeed, occur.

Hackers stolen £651 million from banks

For years, financial institutions around the world have relied upon the Swift payment system for international transactions with partner organisations, individuals, businesses etc. In a way, Swift has proven itself to be a highly efficient, ultra-reliable tool by which the world’s financial infrastructure can operate. Recently, however, a group of as yet unidentified hackers have proven that even a system as secure and heavily defended as Swift can be manipulated in order to help perpetrate cybercrime and digital theft.

According to official reports by global security experts, a team of hackers recently targeted the Bangladesh central bank as part of a massive cyber theft attack involving international money transfer. As a result of the attack, nearly 55 million pounds Sterling were diverted into the hands of these culprits. Although experts now know that the money was transferred to the Philippines, little information has been made available regarding who may have been behind this perfectly executed heist.

This crime has underscore the need for fresh thinking when it comes to designing and properly implementing theft deterrent measures within the Swift network. As it currently stands, there are nearly 11,000 banks and financial institutions which utilise the Swift payment network on a regular basis. In a recent response to the theft, representatives from Swift have stated that the company has known of “…a number of recent cyber incidents in which malicious insiders or external attackers have managed to submit Swift messages from financial institutions’ back offices”.

It is perhaps, reassuring to know that the means by which these criminals were able to manipulate the Swift system was through external means, i.e. the banking infrastructure itself as opposed to the Swift transfer mechanisms. In this heist, for example, Swift merely operated as a means by which the funds were transferred as opposed to the method by which hackers gained access to the funds.

Methods aside, however, this incident serves as a stark reminder that money transfer remains a potentially dangerous and risky tools for businesses and individuals alike. Although the Swift system may not have been directly involved in the heist, it remains the primary vehicle by which one of the world’s larger thefts was successfully completed. More information regarding this shocking crime will likely be made available in the near future. Investigators are actively searching for further information regarding this crime and the identification of possible suspects.

The ‘ins and outs’ of Exchanging Your Currency

Ever since the Brexit results, the pound has suffered against the euro. This can make for a difficult and, oftentimes, confusing journey to exchange your sterling in anticipation of a holiday outside of the UK. The drop in the pound means many families had to refine their travel budgets to accommodate the change in what their pound will get them.

Some bureaux de change offices are offering barely above €1 for £1, especially if you wait till the last minute and changed your money at the airport, for example. On top of the poor exchange rate, you can count on high fees and charges being billed by some of Britain’s biggest banks, such as Lloyds. Lloyds charges 2.99% for every debit car transaction while abroad. It also adds a £1 standard fee on top of the percentage fee. It can cost you £4.50 each time you take money out of a cash machine in Spain. If you must make a cash withdrawal in another country, it is best to take out a large amount, once, than a lot of little withdrawals. By doing that, you can avoid the myriad of flat fees every time you use a machine.

Many people are unaware that you can order money online, ahead of time, and save a lot. Even the pricy airport exchange bureaux can be the best deal, if you order ahead and pick up your money at the airport bureau. There is a website that can help you find the best deal to exchange your currency. TravelMoneyMax.com will search, using your postcode, for the best deal near your house.

Ordering at least 24 hours ahead of time can mean the difference between €1.05 per £1 and €1.17. Some bureaux even offer next-day delivery if you are unable to get to the office in person. There is a small fee for this service but, compared to bank fees, it is a still a good deal. A good thing to keep in mind, whether you are walking up to counter to exchange or you have ordered in advance, is to never use a credit card to exchange. The transaction will be treated as if you were withdrawing money from another country and you will be hit with a lot of fees. Always use cash or a debit card.

No matter how diligent you are when making your vacation budget, something is always bound to come up. Plans change or you face unexpected expenditures. When this happens, it’s wise to be aware of the best way to withdraw money in another country. Most big banks with take off the top approximately 10% of the money you are withdrawing. One exception is Nationwide building society. If you have the society’s FlexPlus account, you can take money from cash machines with no fee at all and the exchange rate is near-pure market rates. There is a monthly fee for this account but it includes family travel insurance and coverage for a car breakdown. Other banks that are fairly cheap are Norwich & Peterborough building society and Metro Bank. It’s understandable that you may not want to switch banks just for a holiday or two. Research your options and you’ll be better off for it.

The last point, and perhaps one of the most important ones to remember, is that many cash machines abroad will ask if you want your transaction to be in pounds instead of in euros. Even in shops, the shopkeepers will ask you this. Always say no. If you say yes the bank or shop will apply its own exchange rate and that rate is guaranteed to be horrible.

Wherever you’re headed for your well-earned vacation, be informed and research before you exchange your money or use a credit or banking card in another country. You worked hard for your money, don’t let a currency exchange take a lot from it.

Impact of Politics on Currency Exchange

Politics can be seen to have what is called the butterfly effect. The election of Donald Trump, the results of the elections in France, the Brexit vote last June, and now the general election results of this month, among others, all play a part in how the currency is valued globally. In the aftermath of this most recent UK election, the pound sterling has slipped again. It was already low, have slumped and never recovered last year after the Brexit vote.

After exit polls predicted that the Conservative party would suffer a major blow in Thursday’s vote, the UK currency fell around 2 per cent. Investors have been spooked by uncertainty after this election ended in a hung parliament. This comes just days before the negotiations of Brexit begin. It slid a further 0.7% and failed to recover after the final results of the election were confirmed.

The Tory party had failed to secure a majority and the results on the markets were not good. The pound has lost more than 14 per cent against the dollar since last June’s Brexit vote. Some speculation surrounding a strengthening of the pound if the election results lead to a softer Brexit but there are many who remain skeptical about this. UniCredit’s chief UK economist, Daniel Varnazza, wrote in a note to clients: ““A ‘hard’ Brexit is almost a given,” “With Theresa May weak, the hard-line Euro-sceptics in the Conservative party, who are more organised than the Remainers, will be able to take the Prime Minister hostage in their pursuit of a hard Brexit. There isn’t any realistic prospect of this chaos leading to a rethink of the Brexit decision for the country.”

The current political uncertainty is having a dramatic impact on the pound and business leaders should take heed and come together to figure out ways to ensure the pound can be made more stable. There are many questions surrounding Brexit now, and the talks are going to have an even more unsettling effect on the markets.

Volatility of the pound will continue while the government figures out who will lead the country. The Brexit talks and negotiations will have the same effect. Even though the economists factored in what they presumed to be the volatility of sterling during the Brexit talks, even they are uncertain of what will happen in the near future. This is not good for attracting investors to the UK.

“Theresa May’s electoral gamble has catastrophically failed,” said Tom Stevenson, an investment director at Fidelity International. The market reaction to this unwelcome outcome is likely to hit UK shares, bonds and the pound. Markets will likely remain on the back foot while the difficult job of putting together a workable government is undertaken.”

Political uncertainty, election results here in the UK and elsewhere, Brexit, and the effects of the global economy, all are part and parcel of an extremely volatile pound and does not bode well for the UK as business continues to try to attract investments, Investments that seem to be waiting for everything to calm down before repatriating assets into the UK.

Category: Money transfer