ECB’s wholesale CBDC + DLT interop, ChatGPT Advanced Voice and Image Features, Meta's Photorealistic Avatars, Quantum Breakthroughs at MIT and more !
Hi Everyone,
Welcome to QX Snapshots - a weekly recap of the key news on emerging technologies. In this newsletter, you will get a "digest" of latest info on AI, Quantum Technology, Industrial Metaverse and Enterprise Blockchain.
Hope it brings you value :)
[Blockchain] ECB Explores Wholesale CBDC and DLT Interoperability. Earlier this month, the European Central Bank (ECB) held the third meeting of the New Technologies for Wholesale settlement covering topics such as DLT settlement systems and wholesale central bank digital currency (CBDC). It proposed starting with a call for participation in November for exploratory work in 2024. It also discussed the Bank for International Settlements' Unified Ledger’ concept. The ECB states that a single Unified Ledger would be difficult to implement practically and might not suit regional needs. It believes ledgers will likely evolve regionally or by use case. Banks seem to agree according to meeting minutes. This aligns with the ECB's interoperability emphasis, which would focus on standardization and integration. The ECB will announce plans from next month and survey industry interest. The November call seeks participating banks and DLT operators. Exploratory work involving real payments is planned in two waves starting in May and July 2024. Mandatory testing preparation occurs December 2023 to March 2024. Other agenda items included DLT use cases, and payment versus payment functionality for multicurrency and cross-border payments.
[AI] OpenAI's ChatGPT Unveils Advanced Voice and Image Features. OpenAI's ChatGPT is enhancing its interface by introducing voice and image functionalities. This new update allows users to engage in voice conversations and share images with ChatGPT, increasing its practicality. These features will be available to Plus and Enterprise users in the forthcoming weeks. The voice feature, accessible on iOS and Android, employs a novel text-to-speech model which creates human-like audio. OpenAI has partnered with voice actors to design these voices and uses its Whisper system to convert spoken language into text. In terms of image capabilities, users can share images for a variety of purposes, from troubleshooting to data analysis. Image comprehension is powered by multimodal GPT-3.5 and GPT-4 models, which blend language reasoning with diverse image types. Given the novelty of these capabilities, OpenAI is deploying them incrementally to manage risks and refine the system. Notably, they have taken measures to ensure user privacy and prevent misuse. They emphasize model limitations, particularly regarding non-English languages, and advise careful verification for specialized topics. Access will be expanded to other user groups soon. 10 examples exploring the capabilities of those new features: here.
[Quantum Technology] MIT Researchers Unveil High-Accuracy Quantum Computing Breakthrough. MIT researchers have demonstrated a new superconducting qubit architecture that enables quantum operations between qubits with much higher accuracy than previously achieved. They utilize fluxonium qubits which have longer lifespans than commonly used transmon qubits. Their architecture couples two fluxonium qubits using a tunable transmon element, which enables strong coupling while minimizing unwanted background noise. This fluxonium-transmon-fluxonium (FTF) design achieved single-qubit gates with 99.99% accuracy and two-qubit gates exceeding 99.9% accuracy, surpassing the threshold for implementing quantum error correction. The longer coherence times of fluxonium qubits coupled with the ability to suppress background noise are key factors enabling such high gate fidelities. This is a significant advance towards fault-tolerant, scalable quantum computing. The researchers highlight this architecture’s flexibility and potential for scaling up. Building on these results, the researchers launched a quantum computing startup, Atlantic Quantum, aiming to commercialize the technology. Industry experts recognize this advancement as a potential game-changer in the journey towards building reliable, fault-tolerant quantum computers.
[Metaverse] Meta's Photorealistic Avatars: A Leap Towards Virtual Realism. Mark Zuckerberg's latest demonstration of Meta's photorealistic avatar technology on the Lex Fridman podcast has garnered praise from previously skeptical internet users. The hour-long conversation between Fridman and Zuckerberg's metaverse avatars looked incredibly lifelike and realistic. Observers often criticize Meta's cartoonish metaverse avatars, but this technology seemed to genuinely astonish viewers. The depiction was so realistic that many viewers and even Fridman momentarily forgot they were observing virtual representations. The avatars were created using Meta's Codec Avatars technology which generates real-time, photorealistic avatars via face tracking sensors on Quest 3 headsets. However, Zuckerberg said this tech requires expensive machine learning and full head scans with specialized cameras, so it likely won't be available to consumers for at least three years. He wants to reduce barriers eventually, saying scans may one day work with regular smartphones. This demonstration comes after Meta unveiled Meta AI, its new AI assistant technology integrated across chatbots, apps and smart glasses. Despite criticisms, Meta's latest avatar tech suggests the metaverse dream remains very much alive and progressing.
[General technology] ?SpaceX's Starshield: U.S. Space Force's $70 Million contract. SpaceX has won its first contract for Starshield, the defense-focused version of its Starlink satellite internet service, from the U.S. Space Force. The one-year, $70 million contract provides end-to-end Starshield service via SpaceX's Starlink satellites and ground equipment to support over 50 U.S. military mission partners. Starlink's role in Ukraine's defense was contested when Elon Musk refused to activate it prior to an attack on Russia's navy. Starshield aims to clarify using a commercial service in military operations. SpaceX says Starshield leverages Starlink technology to support national security, keeping civilian and defense uses separate. Musk agrees this is the right approach. The contract shows the U.S. Space Force's interest in boosting satellite internet capabilities, with Starlink's thousands of low Earth orbit satellites attractive for resilience against attack versus few exquisite satellites. The proliferated Starlink architecture means the overall system can better withstand adversary strikes. The contract validates Starshield's role serving defense users with Starlink's proven satellite infrastructure.
FEATURED: ‘Project Mariana Cross-border exchange of wholesale CBDCs using automated market-makers’
By: BIS Innovation Hub
“Foreign exchange (FX) is the largest financial market in the world, trading about $7.5 trillion a day (BIS (2022b)). It operates 24 hours a day, five and a half days a week. Project Mariana looks to the future and envisions a world in which central banks have issued central bank digital currencies (CBDCs) and explores how foreign exchange (FX) trading and settlement might look. Mariana borrows ideas and concepts from decentralised finance (DeFi) and studies whether so-called automated market-makers (AMMs) can simplify FX trading and settlement with a view to enhancing market efficiency and reducing settlement risk.?
Project Mariana is a proof of concept (PoC) for a global interbank market for spot FX featuring both an AMM and wholesale CBDCs (wCBDCs). In the PoC, wCBDCs circulate on domestic platforms and so-called bridges allow them to be moved on to a transnational network that hosts the AMM. Project Mariana extends previous experimentation on cross-border settlement using wCBDC arrangements and distributed ledger technology. It successfully demonstrates the technical feasibility of the proposed architecture and adds novel insights on the potential of tokenisation in three dimensions. First, wCBDCs are implemented as smart contracts, enabling central banks to manage their wCBDC without the need to directly operate or control the underlying platform. Their design followed best practices from the public blockchain space, building on a widely used standard (ie ERC-20), as well as enabling upgradeability.
Second, bridges may serve as a mechanism to enable broader interoperability in an emerging tokenised ecosystem. As implemented in the PoC, they may enable the seamless and safe transfer of wCBDC between domestic platforms and the transnational network without manual intervention. The bridge design features controls and safeguards and ensures resilience through on-chain (ie bridge smart contracts) and off-chain (ie communication between bridge smart contracts) infrastructure managed by central banks. Third, the AMM, as tested and calibrated in Mariana, fulfilled requirements based on selected FX Global Code (FXGC) principles. It delivers the contours of a possible future tokenised FX market that has a number of potential benefits. These include supporting simple and automated execution of FX transactions, providing options to broaden the range of currencies, eliminating settlement risk and enabling transparency. However, the use of AMMs requires the pre-funding of liquidity and their adoption would therefore entail a significant departure from the ex post funding (deferred net settlement) in use in today’s FX markets.
The Mariana PoC was a first step towards understanding the potential benefits and challenges of AMMs for wholesale FX transactions using wCBDCs. Further work is needed on a range of aspects. Clearly, cyber attacks have repeatedly uncovered vulnerabilities of blockchain and DeFi technology, often with considerable damage to the parties involved. Therefore, while tokenisation and DeFi may have potential benefits, a thorough investigation of security questions is needed. More broadly, future work could extend Mariana into three areas. First, moving beyond technical feasibility, the commercial viability of AMMs for wholesale FX transactions vis-à-vis existing arrangements requires clarification. Collaboration between relevant stakeholders in FX markets would be required to enable such exploration. Second, tokenisation may raise questions about monetary policy implementation, from very specific ones (eg remuneration of wCBDCs) to very broad ones (eg monetary policy instruments building on DeFi ideas and concepts). Third, further work is needed to understand the role of central banks and wCBDCs in a broader tokenised ecosystem potentially including stablecoins, tokenised deposits and financial instruments, such as tokenised bonds and securities. Project Mariana is a collaboration between the BIS Innovation Hub (BISIH), Bank of France, Monetary Authority of Singapore and Swiss National Bank. The project is purely experimental and does not indicate that any of the involved central banks intend to issue CBDC or endorse DeFi or a particular technological solution. ”
Read the full paper: here.
It was great connecting with the talented founders and mentors at the recent "Mentor Magic Week" for the BlockDojo Cohort 6. The Blockdojo team is cultivating an inclusive environment where we can collaborate and unlock the potential of blockchain technology to deliver real business value and drive positive change. Special thanks to Jan McGinley !
Eliot Avellano-Khan Elitsa Angelova Sylvia Smit James Campbell Ana?s Ofranc Claire Hindle Antonio Baccari Daniel Schoneveld Ina Yulo Stuve Alexandre Matsuo Barry Dove Amanda Dickens Michelle Spaul Eva Pascoe Alessio Scannicchio Emily Koolen Lindsey Eynon MCIPS, CPCC, ACCAlexander Ball Matthias De Cnuydt-Hope Jay Gujral James Marchant Gareth Hawkins MBA, FRSA Eva Dobrzanska
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