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Sony Applies to Establish National Crypto Bank, Issue Stablecoin for US Dollar

2 months 4 weeks ago
An anonymous reader shared this report from Cryptonews: Sony has taken Wall Street by surprise after its banking division, Sony Bank, filed an application with the U.S. Office of the Comptroller of the Currency (OCC) to establish a national crypto bank under its subsidiary "Connectia Trust." The move positions the Japanese tech giant to become one of the first major global corporations to issue a U.S. dollar-backed stablecoin through a federally regulated institution. The application outlines plans to issue a U.S. dollar-pegged stablecoin, maintain the reserve assets backing it, and provide digital asset custody and management services. The filing places Sony alongside an elite list of firms, including Coinbase, Circle, Paxos, Stripe, and Ripple, currently awaiting OCC approval to operate as national digital banks. If approved, Sony would become the first major global technology company to receive a U.S. bank charter specifically tied to stablecoin issuance.... The Office of the Comptroller of the Currency "has received over 15 applications from fintech and crypto entities seeking trust charters," according to the article, calling it "a sign of renewed regulatory openness" under the office's new chief, a former blockchain executive. Meanwhile, the United States has also "conditionally given the nod to a new cryptocurrency-focused national bank launched by California tech billionaire Palmer Luckey," reports SFGate: To bring the bank to life, Luckey joined forces with JoeLonsdale, co-founder of Palantir and venture firm 8VC, and financial backer and fellow Palantir co-founder Peter Thiel, according to the Financial Times. Luckey conceived the idea for Erebor following the collapse of the Silicon Valley Bank in 2023, the Financial Times reported. The bank's name draws inspiration from J.R.R. Tolkien's "The Hobbit," referring to another name for the Lonely Mountain in the novel... The OCC said it applied the "same rigorous review and standards" used in all charter applications. The ["preliminary"] approval was granted in just four months; however, compliance and security checks are expected to take several more months before the new bank can open. "I am committed to a dynamic and diverse federal banking system," America's Comptroller of the Currency said Wednesday, "and our decision today is a first but important step in living up to that commitment." "Permissible digital asset activities, like any other legally permissible banking activity, have a place in the federal banking system if conducted in a safe and sound manner. The OCC will continue to provide a path for innovative approaches to financial services to ensure a strong, diverse financial system that remains relevant over time."

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EditorDavid

Why Signal's Post-Quantum Makeover Is An Amazing Engineering Achievement

2 months 4 weeks ago
"Eleven days ago, the nonprofit entity that develops the protocol, Signal Messenger LLC, published a 5,900-word write-up describing its latest updates that bring Signal a significant step toward being fully quantum-resistant," writes Ars Technica: The mechanism that has made this constant key evolution possible over the past decade is what protocol developers call a "double ratchet." Just as a traditional ratchet allows a gear to rotate in one direction but not in the other, the Signal ratchets allow messaging parties to create new keys based on a combination of preceding and newly agreed-upon secrets. The ratchets work in a single direction, the sending and receiving of future messages. Even if an adversary compromises a newly created secret, messages encrypted using older secrets can't be decrypted... [Signal developers describe a "ping-pong" behavior as parties take turns replacing ratchet key pairs one at a time.] Even though the ping-ponging keys are vulnerable to future quantum attacks, they are broadly believed to be secure against today's attacks from classical computers. The Signal Protocol developers didn't want to remove them or the battle-tested code that produces them. That led to their decision to add quantum resistance by adding a third ratchet. This one uses a quantum-safe Key-Encapsulation Mechanism (KEM) to produce new secrets much like the Diffie-Hellman ratchet did before, ensuring quantum-safe, post-compromise security... The technical challenges were anything but easy. Elliptic curve keys generated in the X25519 implementation are about 32 bytes long, small enough to be added to each message without creating a burden on already constrained bandwidths or computing resources. A ML-KEM 768 key, by contrast, is 1,000 bytes. Additionally, Signal's design requires sending both an encryption key and a ciphertext, making the total size 2,272 bytes... To manage the asynchrony challenges, the developers turned to "erasure codes," a method of breaking up larger data into smaller pieces such that the original can be reconstructed using any sufficiently sized subset of chunks... The Signal engineers have given this third ratchet the formal name: Sparse Post Quantum Ratchet, or SPQR for short. The third ratchet was designed in collaboration with PQShield, AIST, and New York University. The developers presented the erasure-code-based chunking and the high-level Triple Ratchet design at the Eurocrypt 2025 conference. Outside researchers are applauding the work. "If the normal encrypted messages we use are cats, then post-quantum ciphertexts are elephants," Matt Green, a cryptography expert at Johns Hopkins University, wrote in an interview. "So the problem here is to sneak an elephant through a tunnel designed for cats. And that's an amazing engineering achievement. But it also makes me wish we didn't have to deal with elephants." Thanks to long-time Slashdot reader mspohr for sharing the article.

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EditorDavid