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Brazil’s central bank to reduce prepaid card exchange fees in setback for fintech companies By Reuters

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© Reuters. People walk in front of the Central Bank headquarters building in Brasilia, Brazil, March 22, 2022. REUTERS/Adriano Machado

BRASILIA (Reuters) – Brazil’s central bank said on Monday it would cut a 0.7 percent limit on interchange fees for prepaid cards, which financial technology companies offer in free digital accounts, in a setback for the booming sector in Latin America’s largest economy.

The central bank brought the issue up for public consultation last year, but its proposal suggested a maximum rate of 0.5% for both debit and prepaid cards, which would be more detrimental to fintech companies.

Bank debit card exchange fees, which must currently comply with a common weighted average of 0.5% and a maximum value of 0.8% per transaction, will now be capped at just 0.5% per transaction.

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An exchange fee is a fee that a merchant pays to the card-issuing bank each time a consumer swipes their card.

The changes will take effect from April 2023, and will also standardize settlement terms for debit and prepaid card transactions.

According to the Central Bank, the changes will “increase the efficiency of the payment system, encourage the use of cheaper payment instruments, which will allow to reduce the costs of stores for accepting these cards.”

Banks lobbied the regulator to put an end to interchange fees on prepaid cards on the grounds that there should be more equal treatment, especially after the staggering rise in fintech companies and their digital accounts.

There is currently no price limit for prepaid cards, which is usually higher than the price charged for transactions with debit cards, which is a significant source of revenue for fintech companies.

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A study released this year by the Zetta Association, which represents companies like Nubank and Mercado Pago, estimated that if the 0.6% cap were to take effect in 2021, fintech customers would pay 24 billion reais ($4.51 billion) in additional service fees. .

Nobank said in a statement that exchange fees on prepaid cards accounted for 7% of its revenue in the year ended June 30. It added that if the changes had been in place, its revenue would have been affected by 2.9%.

(1 dollar = 5.3165 riyals)

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MicroStrategy is at its lowest level since 2020 after the sales were revealed

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(Bloomberg) — Shares of MicroStrategy touched their lowest level since August 2020 after the enterprise software company, which in recent years has been known as the largest buyer of bitcoin, revealed its first sale of the token.

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The stock fell 1.1 percent to $136.63 on Thursday, down 75 percent this year. Bitcoin rose less than 1% to around $16,590 and is believed to have fallen 64% since the start of the year.

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In a filing on Wednesday, MicroStrategy said it acquired approximately 2,395 Bitcoin between the beginning of November and December 21 through its subsidiary MacroStrategy, and paid out approximately $42.8 million in cash. It then sold 704 of the tokens on Dec. 22 for a total of about $11.8 million, citing tax purposes, before buying another 810 of them two days later.

Matt Malley, chief market strategist for Miller Tabak + Co. Step down as CEO. This news means they don’t seem to want to do that anytime soon.”

Overall, MicroStrategy held about 132,500 bitcoins worth over $4 billion USD as of December 27th. The company paid an average purchase price of $30,397 per bitcoin.

“Given MicroStrategy’s $2.4 billion in leverage, we believe the company may have a lot of leverage over Bitcoin, and may face some liquidity risk,” Jefferies analyst Brent Thiel wrote in a note on Wednesday. Thill has an “underperform” rating on the stock and a price target of $110.

Over the years of the pandemic, MicroStrategy has become well known for its Bitcoin takeovers, largely led by Saylor. Earlier this year, Saylor stepped down from that role and now serves as CEO at the company and continues to lead its bitcoin strategy.

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MicroStrategy was trading around $120 before Saylor first announced the company’s Bitcoin purchases in 2020. The stock reached an all-time high of $1,315 in February 2021.

(Updates to include the stock’s closing price in the second paragraph.)

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Bankman-Fried May File Petition in New York Federal Court Next Week Before Judge Louis Kaplan By Cointelegraph

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Former FTX CEO Sam Bankman-Fried is set to appear in court on the afternoon of January 3 to enter a lawsuit over two counts of wire fraud and six counts of conspiracy against him related to the collapse of cryptocurrency exchange FTX, according to Reuters. mentioned on December 28, citing court records. Bankman-Fried will appear before District Judge Lewis Kaplan in Manhattan.

Judge Kaplan was appointed to hear the case on December 27 after the original judge in the case, Ronnie Abrams, Resigned herself because of connections between FTX and the law firm Davis Polk & Wardwell, where her husband is a partner. The company provided advisory services to FTX in 2021.