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🌐Ukraine Bank Finds Stellar Blockchain Brings ‘Key Advantages’🌐
A two-year study from TASCOMBANK, for the most part, adds a Stellar splash of fuel to the developing crypto economy of Ukraine
January 13, 2023
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Ukraine, already receptive to crypto, has one more reason to be bullish on blockchain — thanks to Stellar.

A Thursday report unpacking a two-year study on the feasibility of tapping the Stellar crypto ecosystem to move money around the war-torn country detailed a number of reasons for optimism when it comes to digital assets.

One of Ukraine’s oldest and largest banks, TASCOMBANK, led the pilot behind the study. It came about at the 2021 bequest of several of the eastern European nation’s top financial regulators and legislators.

The TASCOMBANK study, commissioned in part by Ukraine’s influential Ministry of Digital Transformation, found a number of use cases (versus its TradFi banking system) for moving around “electronic money” via Stellar — the blockchain launched by Ripple co-founder Jed McCaleb in 2014 following his exit from Ripple Labs.

The study found Stellar improved security and confidentiality of customer data, boasted far quicker and far cheaper transactions with “high throughput.”

And it’s especially relevant now, given Ukraine’s national bank has blocked local commercial banks from rolling out new forms of “electronic money” — crypto, basically — since “the first days” of Russia’s “full-scale invasion of Ukraine.” 

Ukraine sees real crypto use-cases via Stellar blockchain

Ukraine’s national legislature rolled out a number of significant changes to its regulations around digital assets in 2021, around the same time the study started. 

The study — parsing payments between individuals and businesses, as well as their payrolls — appears to validate a number of the cryptocurrency initiatives that were introduced at the time.  

Deputy Minister of Digital Transformation Oleksandr Bornyakov said the Stellar study highlighted a number of Ukraine-specific “key advantages” of the real world use cases for blockchain tech. Ukraine regulators are considering the possibility, according to Bornyakov, of introducing additional permissions for digital assets as a result

“The results of the [pilot] proved the key advantages of blockchain,” Bornyakov said in a statement. “In particular, fast processing and cost-effectiveness of transactions, accountability and transparency of the system, and also simplified access to financial services.” 

But debate over whether Stellar is sufficiently decentralized has persisted since the network went down for two hours in 2019. Then, in 2021, a string of crypto exchanges halted withdrawals after transactions began failing during a node outage.

Stellarbeat currently shows the blockchain is maintained by only 36 fully validating nodes with 13 lesser validator nodes in support — Stellar’s main rival (and McCaleb’s previous project) Ripple is supported by around 150 while Ethereum boasts hundreds of thousands anchored by almost 11,500 physical nodes.

A lower validator count puts pressure on a small group of machines to keep the network running smoothly, while higher counts allow more of the network to go offline before service is interrupted.

Stellar’s native token XLM has underperformed against bitcoin and ether, on par with XRP

Still, Stellar’s showing in the study is good news for the developing crypto dealings of TASCOMBANK. With the blessing of regulators, the bank has opened up a number of new units focused on emerging TradFi applications for distributed ledger technology (DLT). 

“[The research] confirmed the readiness of the bank’s infrastructure to integrate with blockchain solutions and provide an appropriate level of financial services using virtual assets, taking into account all regulatory requirements,” the study said. 

An executive for the Ukrainian financial entity went as far as to dub the resulting use cases as “drivers of the transformation of the financial landscape in Ukraine.”

It’s set to provide a new, core means for disseminating state-supplied financial assistance to Ukraine citizens. 

The resulting digital payments outlook isn’t all rosy, though. There are scores of outstanding questions to tackle for both regulators and financial facilitators, both said. 

One prominent one pertains to CBDCs: Who would be responsible for overseeing onboarding for its users, including know your customer (KYC) measures?

Oleksii Shaban, deputy chairman of the National Bank of Ukraine, said in TASCOMBANK’s research that the “question remains unanswered today and is closely related to another: “Whether the demand for CBDCs in a wallet opened in a commercial bank (the so-called two-level model) will be sufficient compared to that envisaged in the concept of “digital cash” — digital money as a direct claim to a central bank (the one-level model).”

The outcome demonstrates the proven potential of “real world” use cases built on the consensus-driven blockchain and “sets the foundation for greater adoption of virtual assets in Ukraine,” according to Denelle Dixon, chief executive of the Stellar Development Foundation. 

Largely positive in its assessment of the current role and future potential of cryptocurrencies countrywise, the results ought to bolster a growing number of developing digital asset initiatives pioneered by Ukrainians. 

Plus up-and-coming related pushes pioneered by outside players, such as the UN’s significant move to utilize the stablecoin USDC to act as the rails for disseminating humanitarian aid packages to those in need of money fast: Ukrainian refugees. 

Crypto exchange Binance earlier this month struck a deal with a prominent pharmacy in the country to enable crypto-driven payments for medical products, including medicine. The rationale is to bolster Ukraine’s battered infrastructure via digital assets.

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The Great Onboarding: US Government Anchors Global Economy into Web3 via Pyth Network

For years, the crypto world speculated that the next major cycle would be driven by institutional adoption, with Wall Street finally legitimizing Bitcoin through vehicles like ETFs. While that prediction has indeed materialized, a recent development signifies a far more profound integration of Web3 into the global economic fabric, moving beyond mere financial products to the very infrastructure of data itself. The U.S. government has taken a monumental step, cementing Web3's role as a foundational layer for modern data distribution. This door, once opened, is poised to remain so indefinitely.

The U.S. Department of Commerce has officially partnered with leading blockchain oracle providers, Pyth Network and Chainlink, to distribute critical official economic data directly on-chain. This initiative marks a historic shift, bringing immutable, transparent, and auditable data from the federal government itself onto decentralized networks. This is not just a technological upgrade; it's a strategic move to enhance data accuracy, transparency, and accessibility for a global audience.

Specifically, Pyth Network has been selected to publish Gross Domestic Product (GDP) data, starting with quarterly releases going back five years, with plans to expand to a broader range of economic datasets. Chainlink, the other key partner, will provide data feeds from the Bureau of Economic Analysis (BEA), including Real Gross Domestic Product (GDP) and the Personal Consumption Expenditures (PCE) Price Index. This crucial economic information will be made available across a multitude of blockchain networks, including major ecosystems like Ethereum, Avalanche, Base, Bitcoin, Solana, Tron, Stellar, Arbitrum One, Polygon PoS, and Optimism.

This development is closer to science fiction than traditional finance. The same oracle network, Pyth, that secures data for over 350 decentralized applications (dApps) across more than 50 blockchains, processing over $2.5 trillion in total trading volume through its oracles, is now the system of record for the United States' core economic indicators. Pyth's extensive infrastructure, spanning over 107 blockchains and supporting more than 600 applications, positions it as a trusted source for on-chain data. This is not about speculative assets; it's about leveraging proven, robust technology for critical public services.

The significance of this collaboration cannot be overstated. By bringing official statistics on-chain, the U.S. government is embracing cryptographic verifiability and immutable publication, setting a new precedent for how governments interact with decentralized technology. This initiative aligns with broader transparency goals and is supported by Secretary of Commerce Howard Lutnick, positioning the U.S. as a world leader in finance and blockchain innovation. The decision by a federal entity to trust decentralized oracles with sensitive economic data underscores the growing institutional confidence in these networks.

This is the cycle of the great onboarding. The distinction between "Web2" and "Web3" is rapidly becoming obsolete. When government data, institutional flows, and grassroots builders all operate on the same decentralized rails, we are simply talking about the internet—a new iteration, yes, but the internet nonetheless: an immutable internet where data is not only published but also verified and distributed in real-time.

Pyth Network stands as tangible proof that this technology serves a vital purpose. It demonstrates that the industry has moved beyond abstract "crypto tech" to offering solutions that address real-world needs and are now actively sought after and understood by traditional entities. Most importantly, it proves that Web3 is no longer seeking permission; it has received the highest validation a system can receive—the trust of governments and markets alike.

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US Dept of Commerce to publish GDP data on blockchain

On Tuesday during a televised White House cabinet meeting, Commerce Secretary Howard Lutnick announced the intention to publish GDP statistics on blockchains. Today Chainlink and Pyth said they were selected as the decentralized oracles to distribute the data.

Lutnick said, “The Department of Commerce is going to start issuing its statistics on the blockchain because you are the crypto President. And we are going to put out GDP on the blockchain, so people can use the blockchain for data distribution. And then we’re going to make that available to the entire government. So, all of you can do it. We’re just ironing out all the details.”

The data includes Real GDP and the PCE Price Index, which reflects changes in the prices of domestic consumer goods and services. The statistics are released monthly and quarterly. The biggest initial use will likely be by on-chain prediction markets. But as more data comes online, such as broader inflation data or interest rates from the Federal Reserve, it could be used to automate various financial instruments. Apart from using the data in smart contracts, sources of tamperproof data 👉will become increasingly important for generative AI.

While it would be possible to procure the data from third parties, it is always ideal to get it from the source to ensure its accuracy. Getting data directly from government sources makes it tamperproof, provided the original data feed has not been manipulated before it reaches the oracle.

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