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Hello fintech friends,
I thought the midterms would be the wildest news of the week.
But in a sad story that is still developing, Paraguay’s largest digital bank collapsed, triggering a full political crisis and causing the country’s President to resign. More on that below.
Fintech’s Met Gala Returns
Fintech’s annnual black tie gala, the Fintech Formal, is back in action in New York on December 11th.
This year, we’ll be at 48 Wall Street, the former headquarters of the Bank of New York, chartered and founded by Alexander Hamilton in 1784. Tickets are limited and will be by application only — grab yours at fintechformal.com/#RSVP
Robocop
This is… honestly not the worst idea? Fed Reserve Chair Kevin Warsh has reportedly built a chatbot trained on the writings of classical Keynesian economists (Friedman, Tobin, Schulz) and has policy conversations with it to understand their recommendations.
The outcomes will determine the success of this strategy, but more leaders could benefit from interrogating the works of past luminaries.
The Neobank That Took Down a President
This week, the Central Bank of Paraguay put neobank ueno bank into resolution after finding its solvency ratio had fallen below 50% of the required minimum. Almost three million customers woke up on November 3 to a blank app screen and no ability to access their money.
That’s about 63% of Paraguay’s adult population.
How did a neobank come to take on over 60% of the country as clients? In 2024, with help from the presidential administration, it acquired an existing legacy bank, Visión Banco, to grow its asset base.
Ueno also held roughly $800 million in public deposits, including money from the state pension and health fund and the operators of Paraguay’s hydroelectric dams.
By some estimates, Paraguay has now lost an estimated 15% of its tax revenue.
Paraguayan President Santiago Peña, who has close ties to Ueno, has also resigned. It is not clear yet whether he will face criminal charges.
Peña was a shareholder in Ueno’s parent company, though Ueno denies he was ever a bank shareholder.
After taking office, he appointed Ueno’s then-chief, Carlos Carvallo, to run the central bank, which critics called a conflict of interest.
Ueno grew into a systemic bank during his term, and large amounts of public money ended up there, including $380M from the state pension fund.
After the bank failed, his own Colorado Party abandoned Peña. He announced his resignation on November 5, and minutes later the lower house impeached him 78-0. Congress didn’t formally accept the resignation because the session lost its quorum. Opponents want a trial so he can’t take a lifetime Senate seat that could shield him from prosecution.
Eight senior executives have been detained, including Ueno founder Miguel Vázquez and bank president Juan Manuel Gustale.
Meanwhile, Paraguayan citizens have taken to the streets and are pulling former presidential candidates out of their offices.
It’s unclear how much of their savings or pension funds will be recovered.
- Nik
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The Rundown
🏦 Financial Services & Banking
The OCC issued its first-ever AI guidance for bank examiners, telling them to judge AI by the damage its mistakes could cause, not by how sophisticated the models are.
Mastercard launched a free cybersecurity learning platform for European SMEs, citing research that only 37% use basic tools like antivirus and firewalls.
Visa released an AI shopping benchmark, and the agents mostly struggled: 22 models failed 42.8% of test runs, and over half of those failures still ended in a purchase.
BBVA rolled out in-app travel eSIMs for customers in Italy, powered by Gigs.
The EU and Canada agreed to link their instant payment rails, connecting Canada’s Real-Time Rail with the Eurosystem’s TIPS.
🚀 Product Launches
Mercury launched Agent Controls, a dashboard that shows every AI agent connected to a customer’s account, what it can do and what it has done, and lets users cut it off in seconds. CEO Immad Akhund took a swipe at big banks for locking agents out, citing a 3x jump in new MCP users from August to October.
Wealthsimple unveiled Penny, an AI assistant that can move money and place trades with client sign-off, and said customers will be able to connect their accounts to ChatGPT and Claude in early 2027, even as some big banks restrict third-party agents.
Remote launched virtual expense cards for its employer-of-record customers, putting global employee spend in the same system as payroll with no platform fee.
Tabs partnered with Adyen to power Tabs Pay, letting finance teams bill, collect and reconcile payments without leaving the platform.
Samsung added USDC transfers to Samsung Wallet for U.S. Galaxy users, built with Bastion and Coinbase, with bank payouts to 60+ countries.
Tempo rolled out a third-party credit service, starting with unsecured USDT loans funded and underwritten by Tala for El Dorado users in Bolivia.
OKX launched its Mastercard-powered virtual card in the U.S., letting users spend USDC, USDT and USDG with up to 10% cashback.
dub debuted Arlo, an AI investing assistant that analyzes users’ holdings and makes portfolio recommendations through its registered advisory arm.
Klarna expanded its in-app call verification tool to all 26 of its markets, flagging whether a caller claiming to be Klarna is genuine.
💸 Other News
Fintech stocks tumbled faster than the market in a post-midterm tech selloff, with Dave down 21% after a disappointing earnings call and Robinhood, Figure, SoFi and Affirm each falling 8% to 12%.
Revolut hit a $115 billion valuation in a secondary share sale led by Glade Brook, Coatue and T. Rowe Price, up 53% in a year, as it prepares to launch a U.S. bank in 2027.
Binance users pulled a net $4.72 billion from the exchange after it reopened following a $6.3 billion hack that the FBI tied to North Korea.
Stripe opened stablecoin payouts to U.S. businesses, letting them send USDC and Open USD to external wallets in 160+ markets for 50 cents plus 0.5% per payout.
😞 The Bad News
OPay shelved its $4 billion NYSE IPO on listing day, citing a regulatory inquiry in a jurisdiction it called immaterial to its core business, after pricing shares at the bottom of its range.
Blockchain sleuth ZachXBT named French bank Crédit Mutuel Arkéa as the suspected victim of a $133 million crypto theft from its accounts at Kraken, Crypto.com and OKX, and the bank later confirmed the cyberattack, saying clients would not bear any losses.
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We’ll see you on December 11th 🙌
