Rice-based stable coin is being launched in Indonesia

Rice-based stable coin is being launched in Indonesia

TipRanks

We are indeed living in interesting times – and in many ways, that’s a good thing. Take the automotive industry, for example. Technology is changing a rapid pace, and when it settles, it will dramatically change the way we drive. In 2030, our concept of ‘car’ will likely be unrecognizable to drivers from 1980. The biggest changes are coming from power systems and artificial intelligence. AI will bring autonomous tech to our cars, making self-driving vehicles a reality. But the power systems changes will hit us first. In fact, electric-drive vehicles are already on our roads, and electric vehicle (EV) companies are proliferating rapidly. For the moment, there are several roads to potential success in the EV market. Companies are working to position themselves as leaders in battery tech, or electric power trains, or to maximize their range and performance per charge. It’s a fact-paced industry environment, offering both opportunity and excitement for investors. Smart investors will look for companies capable of meeting scaling demands, once they have settled on marketable models. Investment firm Morgan Stanley has been watching the EV industry, seeking out innovative new design and production companies that are positioning themselves for gains as the market matures. The firm’s automotive analyst, Adam Jonas, has selected two stocks that investors should seriously consider buying into, saying “As we survey the EV/battery startup landscape, we are prioritizing highly differentiated technology and/or business models with a path to scale at a reasonable level of risk.” Opening up the TipRanks database, we’ve pulled up the details on both of Jonas’ picks to see whether they could be a good fit for your portfolio. Fisker (FSR) First up, Fisker, is based in Southern California, the epicenter of so much of our ground-breaking tech industries. Fisker’s focus is on solid-state battery tech, a growing alternative to the lithium-ion batteries that most EVs depend on. While more expensive that the older lithium-based systems, solid state batteries are safer and offer higher energy densities. Fisker has been busy patenting its moves into solid-state batteries, a sound strategy to lock in its advances in this field. For EVs, solid-state batteries offer faster charging times, longer range per charge, and potentially lower battery weight – all important factors in vehicle performance. Every car company needs a flagship model, and Fisker has the Ocean – an EV SUV with a mid-range price ($37,499) and a long-range power system (up to 300 miles). The vehicle features stylish design and room mounted solar panels to supplement the charging system, and is scheduled to enter serial production for the markets in 2022. The stylish design reflects the sensibilities of the company’s founder, Henrik Fisker, known for his work on the BMW Z8 and the Aston Martin DB9. Fisker entered the public markets through a SPAC merger agreement last fall. Since completing the SPAC transaction on October 29, shares in FSR are up 112%. Morgan Stanley’s Jonas is impressed by this company, describing the ‘value proposition of Fisker’ as “…design, time to market, clean sheet user experience and management expertise,” and saying that the 4Q22 launch schedule for the Ocean is likely to be met. “Fisker is specifically targeting the personal owned/passenger car business as opposed to commercial oriented end markets, where emotive design and user experience matter more. Additionally, the company wants to create an all-digital experience from the website to the app to the HMI in the car and continued customer engagement through its flexible lease product,” Jonas added. In line with his upbeat outlook on the company (and the car), Jonas rates Fisker an Overweight (i.e. Buy), and sets a $27 price target suggesting an upside of 42% for the coming year. (To watch Jonas’ track record, click here) Turning to the TipRanks data, we’ve found that Wall Street’s analysts hold a range of views on Fisker. The stock has a Moderate Buy analyst consensus rating, based on 7 reviews, including 4 Buys, 2 Holds, and 1 Sell. Shares are currently priced at $18.99, and the $21.20 average price target implies a one-year upside of ~12%. (See FSR stock analysis on TipRanks) QuantumScape (QS) Where Fisker is working on solid-state batteries in the context of vehicle production, QuantumScape is setting itself up as a leader in EV battery technology and a potential supplier of the next generation of battery and power systems for the EV market. QuantumScape designs and builds solid-state lithium-metal batteries, the highest energy density battery system currently available. The key advantages of the technology are in safety, lifespan, and charging times. Solid-state batteries are non-flammable; they last longer than lithium-ion batteries, with less capacity loss at the anode interface; and their composition allows faster charging, of 15 minutes or less to reach 80% capacity. QuantumScape is betting that these advantages will outweigh the technology’s current higher cost, and create a new standard in EV power systems. The company’s strongest tie to the EV production field is its connection with Volkswagen. The German auto giant put $100 million into QuantumScape in 2018, and an additional $200 million in 2020. The two companies are using their partnership to prepare for mass-scale development and production of solid-state batteries. Like Fisker, QuantumScape went public through a SPAC agreement late last year. The agreement, which closed on November 27, put the QS ticker in the public markets – where it promptly surged above $130 per share. While the stock has since slipped, it remains up 47% from its NYSE opening. For Morgan Stanley’s Jonas, involvement in QS stock comes with high risk, but also high potential reward. In fact, the analyst calls it, “The Biotech of Battery Development.” “We believe their solid state technology addresses a very big impediment in battery science (energy density) that, if successful, can create extremely high value to a wide range of customers in the auto industry and beyond. The risks of moving from a single layer cell to a production car are high, but we think these are balanced by the commercial potential and the role of Volkswagen to help underwrite the early manufacturing ramp,” Jonas explained. Noting that QS is a stock for the long haul, Jonas rates the shares an Overweight (i.e. Buy), and his $70 price target indicates confidence in an upside of 28% for one-year time horizon. Granted, not everyone is as enthusiastic about QS as Morgan Stanly. QS’s Hold consensus rating is based on an even split between Buy, Hold, and Sell reviews. The shares are priced at $54.64 and their recent appreciation has pushed them well above the $46.67 average price target. (See QS stock analysis on TipRanks) To find good ideas for EV stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

Forget bitcoin, card firms should embrace stablecoin payments - Gartner

Research house Gartner has poured cold water on Visa’s recent move to support bitcoin trading on its network, arguing that the real revolution in payments would see centralised financial companies support stablecoin transactions on blockchains.

Earlier this week Visa outlined plans for the first pilot of its new suite of crypto APIs, following other industry players such as PayPal and Square in embracing the digital currency movement.

Gartner analyst Avivah Litan says that the move is welcome, and increase the “technical rails between consumers, businesses and blockchains, and help prepare the transition to future payment infrastructure”.

However, in a blog, she also notes that it is “hardly a revolution”. Having centralised financial companies that earn revenues by charging transaction fees at the centre of crypto goes against the peer-to-peer ideals of blockchain payments.

“Potential users are left to wonder if, in the future, they will have to pay these centralised services additional transaction fees for moving cryptocurrency across peer-to-peer blockchain networks, defeating the promise of blockchain,” writes Litan.

Her answer to this problem is for card brands and other established players to provide the on and off ramps for payors and payees using stablecoins, without being involved in the actual payment that would occur on the blockchain.

This would mean Visa and its peers would not get a transaction fee but would make money from issuers and acquirers using services such as risk management, onboarding and protections for balances.

Concludes Litan: “The question remains: will these centralised financial services companies go forward in line with the spirit of blockchain peer to peer payments at the risk of cannibalizing their existing central-clearing house based-revenue streams? The answer will depend on whether or not these firms have any practical choice.”

How Mastercard’s crypto strategy is distinct from its new stablecoin plans

The crypto space lit up late Wednesday when news broke that Mastercard was expanding the scope of its digital currency support.

Mastercard said in a blog post that it was moving to enable its systems to facilitate payments in the form of stablecoins directly to merchants who choose to accept them. Such a service will complement Mastercard’s existing crypto card-focused offerings, through which consumers can spend their cryptocurrencies via an issuer’s card – though in the end, the transaction is settled outside of Mastercard and in the form of fiat currency like the U.S. dollar.

The payments firm’s chief financial officer, Sachin Mehra, discussed the expanded offerings during a virtual event hosted by Goldman Sachs on Wednesday, according to a published transcript obtained by The Block. But more broadly – and, perhaps, more importantly – Mehra provided a clear-cut break down of how Mastercard views what he termed “sub-categories” of digital currencies: cryptocurrencies, fiat-backed stablecoins and central bank digital currencies, or CBDCs.

Mehra called crypto “an asset class,” adding: “It’s not a payment vehicle as far as we’re concerned.” He spoke about Mastercard’s crypto card program and indicated that such efforts would continue and grow over time. “We’re seeing tremendous growth in that space,” said Mehra, saying later:

“So that’s kind of – and we’ve got numerous agreements in that regard, which are already in play. And we’ll continue to do more and more of those because people want to be able to use that asset class to make payments at the point of sale.”

On the subject of stablecoins, Mehra noted that “we have plans to enable those, regulation pending, across our network.”

Mehra continued:

“So in other words, the delivery of those stablecoins and to allow the settlement of those stablecoins with those merchants who wish to be settling in those stablecoins on a forward-going basis. So we are enabling our network to allow for that to happen yet this year.”

Lastly, Mehra discussed Mastercard’s work in the area of CBDCs, which is perhaps a bit more theoretical given that such currencies remain in their nascent stage. Yet payments firms big and small appear to be positioning themselves as possible service providers should they take off – PayPal being one of those, according to statements from the firm’s leadership – and it seems that Mastercard is no exception.

“We can bring the technology,” said Mehra. “We have – we’re the leader – one of the leaders in terms of the patents we have developed in terms of DLT. And how we can help [central banks] at the infrastructure level and/or the application and services level is something we remain engaged with on numerous [fronts] with several central banks.”

Mehra concluded his remarks by calling the broader crypto sphere “a space to keep an eye on.”

“I think it will ebb and flow depending on what the flavor of the day is as it relates to cryptos. We’ve seen run-ups in crypto prices in the past. But broadly speaking, the use of digital ledger technology is something we will remain focused on.”

One potential conclusion from Mehra’s comments is that whereas Mastercard is interested in capturing value around the interest in cryptocurrencies, the payments firm views stablecoins as worth the investments required to integrate them into its systems. And as for CBDCs, those remain on the horizon – albeit one that might one day constitute an entirely new business line.