E-commerce and trade Archives | Digital Watch Observatory

Supply chains move toward adaptive AI-driven networks

Supply chains are increasingly being redesigned to respond more dynamically to disruption, risk and changing market conditions, as companies explore AI-native systems that can support planning, decision-making and real-time adaptation.

Writing for the World Economic Forum, Avathon CEO Pervinder Johar argues that traditional supply-chain software is struggling to cope with a more volatile operating environment because many systems still rely on rigid rules, static configurations and manual workflows.

The article says the emerging model places greater emphasis on knowledge rather than raw data, combining context and reasoning across suppliers, logistics routes, energy markets and policy environments. AI-native systems are presented as a way to support continuous learning, improve disruption forecasting and help organisations assess alternative responses before problems escalate.

Physical AI is also described as part of the shift, embedding intelligence more directly into operational infrastructure. According to the article, this could allow logistics systems, equipment and connected assets to sense, compute and coordinate responses more quickly across supply-chain networks.

As automation expands, human roles are expected to move towards strategic oversight. Supply-chain professionals may spend less time managing dashboards and exceptions, and more time setting priorities, weighing trade-offs and guiding AI agents through intent expressed in natural language.

The broader argument is that supply-chain management is moving from reactive workflows towards more adaptive coordination, where systems can anticipate disruption, assess options and support decisions across organisations and partners.

Why does it matter?

Supply chains are facing persistent disruption from geopolitical tensions, climate risks, logistics bottlenecks and changing market conditions. If AI-enabled systems can improve forecasting, coordination and response, they could help companies build more resilient operations. However, the shift also raises governance questions around accountability, human oversight, data quality and reliance on automated decision-making across critical trade and logistics networks.

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Bhutan’s Gelephu city launches fast-track crypto licensing for global firms

Bhutan’s Gelephu Mindfulness City has launched an accelerated pathway for crypto and fintech firms already regulated in major financial hubs such as Singapore, Hong Kong and Abu Dhabi.

The system is intended to reduce duplication in compliance checks while allowing eligible companies to incorporate in Gelephu, seek local regulatory approval, and open corporate bank accounts through a coordinated process involving DK Bank, the city’s official banking partner. Standard Know Your Customer and Anti-Money Laundering checks will still apply.

Officials said foreign licences will not replace local supervision, but will instead help streamline due diligence. The framework also differs from passporting models used in regions such as the European Union, as each firm must still meet Gelephu’s own regulatory requirements.

Gelephu Mindfulness City also rejected speculation linking recent Bitcoin transfers flagged by analytics platforms to reserve sales. Officials said Bitcoin held under the country’s ‘Bitcoin Development Pledge’ remains part of strategic reserves allocated for the long-term development of the city.

Why does it matter?

The move shows how smaller jurisdictions are competing for digital asset and fintech firms by offering faster market entry while trying to preserve regulatory credibility. By recognising existing licences without replacing local supervision, Gelephu is positioning itself as a controlled gateway for firms seeking access to a new crypto and fintech jurisdiction.

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Stablecoin rules updated in revised US Senate proposal

The US Senate Banking Committee has released a revised 309-page draft of the Digital Asset Market Clarity Act ahead of a markup vote, reopening debate on stablecoin rewards, DeFi protections and the regulation of digital asset markets.

The draft, proposed by Committee Chair Tim Scott, seeks to provide a federal framework for digital asset market structure, including provisions on securities innovation, illicit finance, decentralised finance, banking innovation, regulatory sandboxes, software developers and customer protection.

A key section addresses stablecoin rewards. The draft would prohibit digital asset service providers from paying interest or yield on payment stablecoin balances in a way that is economically or functionally equivalent to bank deposit interest. However, it would permit certain activity-based or transaction-based rewards and incentives, provided they are not equivalent to interest or yield on a bank deposit.

The text also includes provisions affecting decentralised finance. It covers rules on non-decentralised finance trading protocols, illicit finance obligations for distributed ledger messaging systems, temporary holds for certain digital asset transactions, voluntary cybersecurity programmes for DeFi trading protocols and studies on digital asset mixers, foreign intermediaries and financial stability risks.

Software developer protections are also included in the draft. The bill contains a dedicated title on protecting software developers and software innovation, including provisions on non-fungible tokens, self-custody and blockchain regulatory certainty.

The draft still faces further negotiation before any final vote. Lawmakers continue to debate the balance between consumer protection, illicit finance controls, innovation, stablecoin incentives and the treatment of decentralised finance. At the same time, the legislation needs to be aligned with other Senate work on digital asset market structure.

Why does it matter?

The revised Clarity Act is another step towards a federal framework for digital asset markets in the United States, with rules that could shape how crypto firms, stablecoin platforms and decentralised finance projects operate. Its provisions on stablecoin rewards, DeFi and software developers show lawmakers trying to balance innovation, consumer protection and oversight in one of the world’s most important financial markets.

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Dubai opens government payments to crypto users

Dubai residents will be able to pay government fees using virtual assets after Crypto.com’s UAE entity, Foris DAX Middle East FZE, received a Stored Value Facilities licence from the Central Bank of the UAE.

Crypto.com said the approval makes it the first Virtual Asset Service Provider in the UAE to receive the licence. It allows the company to activate its partnership with the Dubai Department of Finance, enabling virtual asset payments for government services.

Financial settlements will be conducted in UAE dirhams or Central Bank-approved dirham-backed stablecoins through the regulated Stored Value Facilities framework. Crypto.com said the arrangement supports the Dubai Cashless Strategy.

Users wishing to access the service will need to be onboarded through Crypto.com’s VARA-licensed platform. The company also said that, subject to further Central Bank approvals, the licence could support crypto payment integrations with Emirates and Dubai Duty Free.

Crypto.com executives described the approval as a step towards regulated digital asset adoption in the UAE, while linking it to the country’s wider push for compliant crypto infrastructure and digital payments innovation.

Why does it matter?

The development shows how Dubai is moving virtual asset payments closer to public-sector infrastructure, rather than treating them only as investment products or private-sector payment experiments. By routing payments through a regulated Stored Value Facilities framework and settling them in dirhams or approved dirham-backed stablecoins, the model links crypto access with conventional payment oversight, financial regulation and the emirate’s cashless economy strategy.

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European Central Bank moves forward with digital euro technical work

The European Central Bank is advancing technical work on the digital euro, a proposed electronic form of central bank money designed to complement cash in an increasingly digital payments landscape.

The project reflects Europe’s response to the rapid shift towards digital payments, where cards, apps and mobile wallets are increasingly used for everyday transactions. The ECB says a digital euro would provide a European payment option that could be used across the euro area, both online and offline.

Users would be able to store digital euro holdings in an account set up with a bank or public intermediary and use them for in-store, online and person-to-person payments. The ECB says the system would aim to combine the convenience of digital payments with features associated with cash, including offline functionality.

Policy objectives include strengthening Europe’s strategic autonomy in payments, supporting monetary sovereignty and ensuring access to public money in digital form. The ECB has also presented privacy as a central design feature, saying offline digital euro payments would offer cash-like privacy, with transaction details known only to the payer and the recipient.

The project remains conditional on the EU legislative process. The ECB aims to be technically ready for a potential first issuance of the digital euro in 2029, assuming the necessary EU legislation is adopted in 2026.

Supporters view the digital euro as a way to preserve the role of central bank money in digital payments and reduce reliance on non-European payment providers. Debate continues over how to balance innovation, privacy, financial inclusion, bank intermediation and public trust.

Why does it matter?

The digital euro would shape how public money functions in a digital economy increasingly dominated by private payment platforms and international card schemes. Its significance lies not only in creating a new payment tool, but in preserving access to central bank money, supporting European payment sovereignty and setting privacy expectations for public digital infrastructure.

Its success will depend on whether the final design can offer clear benefits over existing payment options while maintaining trust, usability and strong safeguards. The project also raises broader questions about how central banks remain relevant in everyday payments without crowding out private-sector innovation or weakening the role of commercial banks.

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WTO members form duty-free pact after e-commerce moratorium lapses

The United States and 18 other World Trade Organization members have moved to create a separate pact pledging not to impose customs duties on electronic transmissions, after members failed to renew the wider WTO e-commerce moratorium.

According to the document cited in the report, the group includes the United States, Ja p an, South Korea, Singapore, Australia, Norway, and Argentina. The 19 members said they would not impose duties on electronic transmissions for an unspecified period and expressed disappointment that the multilateral moratorium had lapsed.

Members of the group said they remained committed to providing businesses and consumers with a measure of predictability and certainty in the absence of the WTO-wide moratorium. They also invited other WTO members to join the arrangement.

First agreed in 1998 and renewed repeatedly since then, the moratorium prevents WTO members from imposing customs duties on cross-border electronic transmissions, including streaming, downloads and software transfers.

At MC13 in March 2024, WTO members adopted the most recent ministerial decision on the issue, extending the practice of not imposing customs duties on electronic transmissions until the 14th Ministerial Conference or 31 March 2026, whichever came earlier.

Its lapse followed failed efforts to extend the arrangement, with Brazil maintaining its opposition to a four-year renewal.

US Ambassador to the WTO Joseph Barloon told delegates that Washington was launching the plurilateral agreement to give businesses and consumers greater certainty and predictability. He said the move did not close the door to multilateral engagement, but that the United States would not wait for all WTO members to agree before responding to stakeholder needs.

Business groups warned that the failure to preserve a WTO-wide moratorium would raise concerns about global digital trade. Sabina Ciofu of techUK said the 19-member pact offered a way forward but that the absence of a multilateral agreement was worrying. At the same time, International Chamber of Commerce Secretary General John Denton described the pact as a temporary fix rather than a substitute for a WTO-wide deal.

Why does it matter?

The lapse of the WTO e-commerce moratorium weakens one of the longest-standing global understandings underpinning digital trade. A 19-member pact may preserve duty-free treatment among participating economies, but it also points to a more fragmented environment in which rules for electronic transmissions could increasingly depend on partial arrangements rather than WTO-wide consensus.

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MoneyGram and Kraken connect crypto and cash globally

Kraken has entered a strategic partnership with MoneyGram to enable crypto-to-cash withdrawals in more than 100 countries. The integration links digital asset infrastructure with MoneyGram’s global network, allowing users to convert crypto into hundreds of fiat currencies through physical and digital payout channels.

The service is intended to address one of the main barriers to crypto adoption by improving access to reliable off-ramps. Users will be able to transfer funds to their accounts and receive near-instant cash payouts through MoneyGram’s retail network and regulated payment infrastructure.

Both companies highlighted the importance of interoperability between traditional finance and digital assets in driving practical adoption.

Kraken stressed the value of connecting liquidity and compliance systems with established payment rails, while MoneyGram presented its global distribution network as a bridge between digital value and everyday financial use.

The rollout will begin across the United States, Europe, Latin America, Africa, and parts of Asia-Pacific, with plans to expand further into local bank deposits and additional payment services as the partnership develops.

Why does it matter?

The partnership addresses one of the main friction points in crypto adoption: converting digital assets into usable cash at scale. By linking crypto infrastructure with a global payout network, it strengthens the practical use of digital assets beyond trading and speculation.

More broadly, it reflects a gradual convergence between traditional financial rails and crypto-native systems, with interoperability becoming increasingly important to how value moves across borders.

It may also support financial inclusion by expanding access to cash-out services in regions where banking infrastructure remains limited or uneven.

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Meta taps blockchain networks for faster creator payments

Meta has introduced USDC payouts for selected Facebook creators in Colombia and the Philippines, marking another step towards using blockchain-based payment rails for creator earnings. The programme allows eligible users to receive funds directly into crypto wallets using Polygon or Solana as settlement networks.

Creators receiving USDC on Polygon can move funds through supported wallets or exchanges and convert them into local currency where off-ramp services are available. The model reduces reliance on traditional cross-border payment channels and is intended to give creators faster and more flexible access to dollar-denominated earnings.

Polygon has been included alongside Solana as part of the payout infrastructure, with Polygon arguing that its network already handles a large share of global USDC transfer activity. Low transaction costs and broad wallet and exchange support are presented as key reasons stablecoin rails are becoming more attractive for recurring digital payouts.

Why does it matter?

The significance of the move lies less in crypto branding than in payment infrastructure. Meta is testing whether stablecoin rails can make creator payouts faster, more flexible, and less dependent on the frictions of traditional cross-border transfers. If this model scales, it would suggest that blockchain networks are becoming useful not only for trading or speculation, but for mainstream platform payments where speed, settlement, and access to dollar-denominated value matter.

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Brazil restricts use of cryptoassets for cross-border payment settlement

Brazil’s central bank has introduced new restrictions preventing regulated cross-border payment providers from using cryptoassets to settle international transactions. The measure forms part of updated rules for electronic foreign exchange services, known as eFX.

Under Resolution BCB No. 561, settlement between eFX providers and foreign counterparties must take place through authorised foreign exchange transactions or non-resident Brazilian real accounts. Use of virtual assets such as stablecoins or cryptocurrencies for settlement is explicitly prohibited.

The rule does not ban crypto trading or peer-to-peer transfers, but focuses on the infrastructure used by regulated payment firms. Stablecoin-based settlement models are expected to be most affected, as they have been widely used to facilitate faster and lower-cost cross-border payments.

The decision aligns with Brazil’s broader regulatory strategy to tighten oversight of digital assets, including AML compliance, taxation frameworks, and classification of certain crypto flows as foreign exchange operations.

Regulators aim to maintain control over cross-border capital movement while allowing crypto activity to continue outside regulated payment rails.

Why does it matter?

Brazil’s decision reflects a broader global effort to reassert control over cross-border financial infrastructure as crypto-based settlement systems grow in scale and speed.

By keeping regulated payment flows within traditional foreign exchange channels, authorities aim to preserve monetary oversight, tax visibility, and compliance enforcement in a system where stablecoins are increasingly bypassing conventional banking rails.

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Crypto crackdown intensifies in Kazakhstan over illegal exchanges

Kazakhstan’s financial regulator has warned that several major cryptocurrency exchanges are operating without the licences required under the country’s current digital asset framework, reinforcing its strict authorisation regime.

The Astana Financial Services Authority identified prominent platforms, including HTX, Bitget, OKX, and MEXC, as operating without the necessary permits. Under existing rules, only entities licensed within the Astana International Financial Centre are allowed to provide regulated digital asset services.

Authorities stressed that international popularity does not exempt platforms from complying with local law. They also warned that unauthorised exchanges can expose users to financial losses, data breaches, and fraudulent schemes, and urged the public to verify platforms through the official register of licensed firms. AFSA’s website currently shows a regulated ecosystem with dozens of authorised entities across the AIFC framework.

The warning comes amid broader enforcement efforts as Kazakhstan tries to formalise its crypto sector while positioning itself as a regulated regional hub for digital assets. In parallel, law enforcement agencies have reported wider crackdowns on illegal crypto activity, including shadow exchanges and money-laundering networks.

Why does it matter?

Kazakhstan’s tightening enforcement shows a broader push to bring crypto activity into a more formal and supervised market structure. By restricting unlicensed platforms and steering users towards authorised entities, the authorities are trying to reduce exposure to financial crime, improve market transparency, and build credibility for Kazakhstan’s ambition to become a regulated regional digital asset hub.

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