Key Takeaways
- BNY (BK) is reportedly in discussions with Payward, the parent company of Kraken, for a broad partnership focused on digital asset infrastructure and financial market integration.
- Meta Platforms (META) has officially parted ways with employees hired from Virtue AI, an AI safety startup, just four months after the initial "acqui-hire" deal.
- The New York Fed reported zero activity for its Standing Repo Facility (SRF) on October 2, 2024, indicating stable liquidity conditions in the overnight lending markets.
- Payward continues to expand its institutional footprint, following a recent $100 million investment from Nasdaq and a valuation of $21 billion.
BNY and Kraken Parent Explore Infrastructure Alliance
BNY (BK), the world’s largest custody bank, is in active negotiations with Payward, the parent company of the Kraken cryptocurrency exchange. According to reports from CoinDesk, the potential partnership aims to bridge the gap between traditional finance and digital assets through shared infrastructure. The discussions are said to cover a wide range of services, including custody, wealth management, trading, and payments.
The deal could mirror a recent infrastructure agreement between Payward and Nasdaq, which included a $100 million investment in the crypto firm. BNY (BK) has been increasingly aggressive in the digital space, recently developing tokenized deposits to facilitate real-time on-chain settlements for institutional clients. While talks are ongoing, neither company has officially confirmed a finalized agreement.
Meta Platforms Cuts Ties with Virtue AI Talent
Meta Platforms (META) has terminated its relationship with the team it recently hired from Virtue AI, a startup specializing in AI safety and stress-testing. A spokesperson for the social media giant confirmed the move to Semafor on Friday, ending a partnership that began only four months ago. The "acqui-hire" had originally brought in founders and researchers to bolster Meta's AI agent security and red-teaming capabilities.
The sudden departure comes as Meta (META) continues to navigate the high costs and safety requirements of its massive AI development cycle. Virtue AI was known for its proprietary attack algorithms and the development of the MMLU benchmark, a standard for evaluating large language models. The reason for the separation remains unclear, though it follows a broader trend of shifting priorities within big tech AI safety divisions.
NY Fed Reports Zero Standing Repo Facility Usage
The Federal Reserve Bank of New York announced that it accepted $0 million of the $0 million submitted to its Standing Repo Facility (SRF) during its latest operation on October 2, 2024. The lack of submissions suggests that primary dealers and eligible banks currently have sufficient liquidity and do not need to utilize the Fed's backstop for overnight funding.
The SRF serves as a critical mechanism to support the effective implementation of monetary policy by providing a liquidity ceiling. With the facility remaining untouched, market analysts view this as a sign of smooth market functioning and stable interest rate environments in the repo market. The facility currently offers a fixed rate of 3.75% to 4.00% depending on the specific operational parameters in place.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.