Today Circle customers in the US, UK and Europe now have the ability to send and receive money instantly across borders with no fees and no markup on foreign exchange rates. For the first time, sending money across borders is just like sending email or sharing photos: free and instant. It’s another step in our mission to tear down borders and barriers to sending money anywhere in the world.
Other news we’re sharing today includes:
- More information about Circle in Europe
- New features that simplify using Circle with friends
- How Circle is using crypto assets and blockchain technology to make this simplification possible
- New details about Spark, technology that will help connect consumer payments globally in the same way that email and SMS connect people’s communications
- New details about services we’re working on that will ultimately help people access credit and make use of their savings in more effective ways.
Announcing No Fee and No FX Markup on Cross Currency P2P Payments
People around the world have benefited from the ability to share and discover content and communicate freely over the internet. The benefits to humanity of this ability to communicate quickly, without charge and instantly have is really hard to even quantify. Today, we’re bringing this same model to payments.
No one will ever have to pay fees or foreign exchange markups on payments sent to or from the U.S., UK or more than a dozen European countries. Payments can now be sent between US dollars, British pound sterling or euros instantly and there are no fees at all and zero FX markup on exchange rates if sent using Circle.
Whether paying back a friend or family member, sending some funds to your child or family member overseas, or chipping in for a trip – sending funds in the US, UK or Europe now works the same as sharing a photo, text message or email. Funds are sent for free and arrive instantly.
This is a significant new benefit for Circle customers. It also represents a disruption to the entire consumer cross-border payment market. Prices and profit margins for payments are collapsing to zero, in the same way that the price of communications and information publishing collapsed to zero in the first phases of the internet.
Understandably, people will be asking how Circle can make this possible. How can a business afford to remove any fees for sending money around the world? More on that below.
European Growth Momentum
Circle continues to rollout in Europe with significant growth in the past year. Circle’s overall growth rate in customers year over year has been over 1000%, and our payments volume growth rate in Europe since January has been over 500%. In 2017 in the UK, Circle’s average monthly social payments growth rate has been over 50%. Circle handled over $1B in transaction volume in 2016.
Most Circle European customers are millennials (90% are below 35 years old and 60% are below 25 years old) and they use the product for many of their day-to-day person to person payments such as splitting the cost of a meal, sharing rent and its associated expenses, and reimbursing for a gift.
Circle is officially launched in the US, UK, Spain and Ireland and is also available in Early Access release in 15 other markets (Germany, France, Italy, Netherlands, Finland, Slovenia, Slovakia, Estonia, Austria, Portugal, Poland, Luxembourg, Czech Republic, Croatia, Liechtenstein).
We’ve also introduced a range of product updates that ease how customers can get started, share and use Circle with friends, make larger payments, and receive money faster.
Customers can now receive payments into their bank accounts even faster through the introduction of near-instant withdrawals in the UK via Faster Payments to UK bank accounts, and same day withdrawals into most European bank accounts via SEPA Withdrawals.
Customers can now sign up and use Circle in seconds using a Facebook account. We’ve also made it easier to find friends who are already using Circle, including friends in your mobile contacts and Facebook friends.
Customers wanting to send larger payments (thousands of pounds, euro or dollars) can now more easily do so without significant delays, with instant upgrades to higher limits for most customers, and once again, with zero fees and no FX margin or markup.
Finally, customers on iOS can enable Touch ID for authorizing payments and transactions. While many finance apps support Touch ID for additional login security, Circle now supports using Touch ID to authorize each payment and withdrawal, eliminating the hassle of two-step verification codes for those who prefer this form of security.
Making Payments Instant, Global and Free: How do we make this possible?
So let’s get back to those questions about how Circle can deliver so much and charge nothing. Circle was founded on the vision that open protocols were emerging for the storage and transmission of value, in the same way that we have protocols for sharing and moving information and data over the internet. Originally inspired by Bitcoin and its underlying blockchain, these technologies have matured to the point where we can now make this possible.
Last December we announced Spark, an open source project that enables consumer digital wallets to work together seamlessly over the internet. Spark is an evolution of our core infrastructure for transactions, currencies, identity, risk and all the business rules that leverage them.
Spark is built on Ethereum and can run on private and public ethereumblockchains, while being designed for compatibility with other DLT technologies and runtimes. Spark provides a smart contract container that enables wallet-to-wallet transactions within and across currencies, including native digital assets as well as digital fiat assets (digital dollars, euros and other currencies). Also within Spark are all the rules for payment settlement and reversals, and the secure exchange of KYC/AML-related information to meet compliance obligations.
While we have not yet released the open source code for Spark, we are working with multiple consumer internet and consumer fintech companies on implementing Spark and helping take the ecosystem forward toward free and open consumer payments. We hope it will become a global centerpiece for sharing value on the Internet, in the same way that email and other consumer services seamlessly pass from country to country online.
Crypto Assets and Circle Trading
Over the past several years, Circle has put in place a treasury and trading operation that ensures that our customers can beam money between currencies instantly and for free. A bigpart of that involves actively trading in the digital currency market. As we prepare to rollout Spark with more partners in more geo-currency zones, Circle has significantly expanded its crypto asset trading activity.
Circle actively trades and provides significant market liquidity for bitcoin, ether, xrp and increasingly nascent tokens and ICOs. We actively make markets on nearly all major exchanges globally, and provide significant scale in over the counter (OTC) trading with large natural buyers and sellers of crypto assets. The growth is significant — last month (May 2017) Circle directly traded over $800M in crypto assets.
With the recent explosion of interest in digital assets around the world, this activity has expanded, and Circle is actively taking on more and more trading counterparties. There’s a lot of exciting activity as the market for digital assets matures into what appears to be a more mainstream category for investment and wealth management. Circle intends to continue to be at the forefront of this market maturation phase.
Our focus today is on delighting consumers in the US, UK and Europe with an open, global social payments experience. We continue to build connections with other p2p payment apps using blockchain technologies that will enable these experiences all around the world and across all major currencies. This is a massive and multi-year project and something we have been committed to and working on since our inception. We’re finally reaching many of the initial goals and milestones that we set out for ourselves when we founded the company, and the underlying technology is now maturing to a point where we can do this in a truly open and global manner.
We don’t believe there is a revenue model for domestic or cross border consumer payments, and we are not trying to generate any revenue from those payments. Just as the internet entirely commoditized information sharing, data sharing and communications, we are on the cusp of that commoditization happening in consumer payments.
With a rapidly growing customer base and the launch of Circle throughout the U.S., U.K. and major European countries, we are beginning to share more details about new products in consumer finance integrated with the Circle consumer experience. Our innovations in social payments, blockchain technology, digital asset investment and trading markets, and machine learning-based risk decisions, are leading us toward exciting initiatives that can truly revolutionize how consumers can access credit, share value with each other, and save and invest their money.
Our view has been that payments and spending accounts will become a global commodity on the internet, replacing traditional bank accounts and leading to new types of experiences rootedin mobile social and messaging behaviors. And these accounts will be built on global open protocols for value exchange. We’re almost there.
We believe the same technology drivers that make payment utility a free service will also create opportunities to radically transform the time value of money, creating new models of lending and credit and new avenues for saving and investing. These new models of saving and investing will be built on blockchain tech and point toward an open, borderless and software-powered future for consumer finance. This is an exciting future, and we’re happy to help drive it forward.
Jeremy and Sean, Circle Co-Founders
Airbus CEO urges trade war ceasefire, easing of COVID travel bans
By Tim Hepher
PARIS (Reuters) – The head of European planemaker Airbus called on Saturday for a “ceasefire” in a transatlantic trade war over aircraft subsidies, saying tit-for-tat tariffs on planes and other goods had aggravated damage from the COVID-19 crisis.
Washington progressively imposed import duties of 15% on Airbus jets from 2019 after a prolonged dispute at the World Trade Organization, and the EU responded with matching tariffs on Boeing jets a year later. Wine, whisky and other goods are also affected.
“This dispute, which is now an old dispute, has put us in a lose-lose situation,” Airbus Chief Executive Guillaume Faury said in a radio interview.
“We have ended up in a situation where wisdom would normally dictate that we have a ceasefire and resolve this conflict,” he told France Inter.
Boeing was not immediately available for comment.
Brazil, which has waged separate battles with Canada over subsidies for smaller regional jets, on Thursday dropped its own complaint against Ottawa and called for a global peace deal between producing nations on support for aerospace.
Faury said the dispute with Boeing was particularly damaging during the COVID-19 pandemic, which has badly hit air travel and led to travel restrictions or border closures. He expressed particular concern about widening bans within Europe.
“We are extremely frustrated by the barriers that restrict personal movement and it is almost impossible today to travel in Europe by plane, even domestically,” he said.
“The priority no. 1 for countries in general is to reopen frontiers and allow people to travel on the basis of tests and then eventually vaccinations.”
The comments come as businesses increase pressure on governments to reopen economies as coronavirus vaccine roll-outs gather pace across Europe.
France has defended recently introduced border restrictions, saying they will help the government avoid a new lockdown and stay in force until at least the end of February.
Germany installed border controls with the Czech Republic and Austria last Sunday, drawing protest from Austria and concerns about supply-chain disruptions.
Berlin calls the move a temporary measure of last resort.
Poland said on Saturday it had not ruled out imposing restrictions at the country’s borders with Slovakia and the Czech Republic due to rising COVID-19 cases.
(Reporting by Tim Hepher; Editing by Kirsten Donovan)
Why a predictable cold snap crippled the Texas power grid
By Tim McLaughlin and Stephanie Kelly
(Reuters) – As Texans cranked up their heaters early Monday to combat plunging temperatures, a record surge of electricity demand set off a disastrous chain reaction in the state’s power grid.
Wind turbines in the state’s northern Panhandle locked up. Natural gas plants shut down when frozen pipes and components shut off fuel flow. A South Texas nuclear reactor went dark after a five-foot section of uninsulated pipe seized up. Power outages quickly spread statewide – leaving millions shivering in their homes for days, with deadly consequences.
It could have been far worse: Before dawn on Monday, the state’s grid operator was “seconds and minutes” away from an uncontrolled blackout for its 26 million customers, its CEO has said. Such a collapse occurs when operators lose the ability to manage the crisis through rolling blackouts; in such cases, it can take weeks or months to fully restore power to customers.
Monday was one of the state’s coldest days in more than a century – but the unprecedented power crisis was hardly unpredictable after Texas had experienced a similar, though less severe, disruption during a 2011 cold snap. Still, Texas power producers failed to adequately winter-proof their systems. And the state’s grid operator underestimated its need for reserve power capacity before the crisis, then moved too slowly to tell utilities to institute rolling blackouts to protect against a grid meltdown, energy analysts, traders and economists said.
Early signs of trouble came long before the forced outages. Two days earlier, for example, the grid suddenly lost 539 megawatts (MW) of power, or enough electricity for nearly 108,000 homes, according to operational messages disclosed by the state’s primary grid operator, the Electric Reliability Council of Texas (ERCOT).
The crisis stemmed from a unique confluence of weaknesses in the state’s power system.
Texas is the only state in the continental United States with an independent and isolated grid. That allows the state to avoid federal regulation – but also severely limits its ability to draw emergency power from other grids. ERCOT also operates the only major U.S. grid that does not have a capacity market – a system that provides payments to operators to be on standby to supply power during severe weather events.
After more than 3 million ERCOT customers lost power in a February 2011 freeze, federal regulators recommended that ERCOT prepare for winter with the same urgency as it does the peak summer season. They also said that, while ERCOT’s reserve power capacity looked good on paper, it did not take into account that many generation units could get knocked offline by freezing weather.
“There were prior severe cold weather events in the Southwest in 1983, 1989, 2003, 2006, 2008, and 2010,” Federal Energy Regulatory Commission and North American Electric Reliability Corp staff summarized after investigating the state’s 2011 rolling blackouts. “Extensive generator failures overwhelmed ERCOT’s reserves, which eventually dropped below the level of safe operation.”
ERCOT spokeswoman Leslie Sopko did not comment in detail about the causes of the power crisis but said the grid’s leadership plans to re-evaluate the assumptions that go into its forecasts.
The freeze was easy to see coming, said Jay Apt, co-director of the Carnegie Mellon Electricity Industry Center.
“When I read that this was a black-swan event, I just have to wonder whether the folks who are saying that have been in this business long enough that they forgot everything, or just came into it,” Apt said. “People need to recognize that this sort of weather is pretty common.”
This week’s cold snap left 4.5 million ERCOT customers without power. More than 14.5 million Texans endured a related water-supply crisis as pipes froze and burst. About 65,000 customers remained without power as of Saturday afternoon, even as temperatures started to rise, according to website PowerOutage.US.
State health officials have linked more than two dozen deaths to the power crisis. Some died from hypothermia or possible carbon monoxide poisoning caused by portable generators running in basements and garages without enough ventilation. Officials say they suspect the death count will rise as more bodies are discovered.
THIN POWER RESERVE
In the central Texas city of Austin, the state capital, the minimum February temperature usually falls between 42 and 48 degrees Fahrenheit (5 to 9 degrees Celsius). This past week, temperatures fell as low as 6 degrees Fahrenheit (-14 degrees Celsius).
In November, ERCOT assured that the grid was prepared to handle such a dire scenario.
“We studied a range of potential risks under both normal and extreme conditions, and believe there is sufficient generation to adequately serve our customers,” said ERCOT’s manager of resource adequacy, Pete Warnken, in a report that month.
Warnken could not be reached for comment on Saturday.
Under normal winter conditions, ERCOT forecast it would have about 16,200 MW of power reserves. But under extreme conditions, it predicted a reserve cushion of only about 1,350 MW. That assumed only 23,500 MW of generation outages. During the peak of this week’s crisis, more than 30,000 MW was forced off the grid.
Other U.S. grid operators maintain a capacity market to supply extra power in extreme conditions – paying operators on an ongoing basis, whether they produce power or not. Capacity market auctions determine, three years in advance, the price that power generators receive in exchange for being on emergency standby.
Instead, ERCOT relies on a wholesale electricity market, where free market pricing provides incentives for generators to provide daily power and to make investments to ensure reliability in peak periods, according to economists. The system relied on the theory that power plants should make high profits when energy demand and prices soar – providing them ample money to make investments in, for example, winterization. The Texas legislature restructured the state’s electric market in 1999.
Since 2010, ERCOT’s reserve margin – the buffer between generation capacity versus forecasted demand – has dropped to about 10% from about 20%. This has put pressure on generators during demand spikes, making the grid less flexible, according to North American Electric Reliability Corporation (NERC), a nonprofit regulator.
That thin margin for error set off alarms early Monday morning among energy traders and analysts as they watched a sudden drop in the electrical frequency of the Texas grid. One analyst compared it to watching the pulse of a hospital patient drop to life-threatening levels.
Too much of a drop is catastrophic because it would trigger automatic relay switches to disconnect power sources from the grid, setting off uncontrolled blackouts statewide. Dan Jones, an energy analyst at Monterey LLC, watched from his home office in Delaware as the grid’s frequency dropped quickly toward the point that would trigger the automatic shutdowns.
“If you’re not in control, and you are letting the equipment do it, that’s just chaos,” Jones said.
By Sunday afternoon about 3:15 p.m. (CST), ERCOT’s control room signaled it had run out of options to boost electric generation to match the soaring demand. Operators issued a warning that there was “no market solution” for the projected shortage, according to control room messages published by ERCOT on its website.
Adam Sinn, president of Houston-based energy trading firm Aspire Commodities, said ERCOT waited far too long to start telling utilities to cut customers’ power to guard against a grid meltdown. The problems, he said, were readily apparent several days before Monday.
“ERCOT was letting the system get weaker and weaker and weaker,” Sinn said in an interview. “I was thinking: Holy shit, what is this grid operator doing? He has to cut load.”
Sinn said he started texting his friends on Sunday night, warning them to expect widespread outages.
‘SECONDS AND MINUTES’
Early Monday morning, one of the largest sources of electricity in the state – the unit 1 reactor at the South Texas Nuclear Generating Station – stopped producing power after the small section of pipe froze in temperatures that averaged 17 degrees Fahrenheit (9 degrees Celsius). The grid lost access to 1,350 MW of nuclear power – enough to power about 270,000 homes – after automatic sensors detected the frozen pipe and protectively shut down the reactor, said Victor Dricks, a spokesman for the U.S. Nuclear Regulatory Commission.
About 2:30 a.m. (CST), the South Plains Electric Cooperative in Lubbock said it received a phone call from ERCOT to cut power to its customers. Inside the ERCOT control room, staff members scrambled to call utilities and cooperatives statewide to tell them to do the same, according to operational messages disclosed by the grid operator.
Three days later, ERCOT Chief Executive Bill Magness acknowledged that the grid operator had only narrowly avoided the calamity of uncontrolled blackouts.
“If we hadn’t taken action,” he said on Thursday, “it was seconds and minutes (away), given the amount of generation that was coming off the system at the same time that the demand was still going up.”
(Reporting by Tim McLaughlin and Stephanie Kelly; additional reporting by Nichola Groom; editing by Simon Webb and Brian Thevenot)
UK could declare Brexit ‘water wars’ – The Telegraph
(Reuters) – Britain could restrict imports of European mineral water and several food products under retaliatory measures being considered by ministers over Brussels’ refusal to end its blockade on British shellfish, the Telegraph reported.
Senior government sources pointed to potential restrictions on the importing of mineral water and seed potatoes, the report said.
(Reporting by Maria Ponnezhath in Bengaluru; Editing by Daniel Wallis)
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By Tim Hepher PARIS (Reuters) – The head of European planemaker Airbus called on Saturday for a “ceasefire” in a...
Why a predictable cold snap crippled the Texas power grid
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