Banking Watchdog Warns of Highly Cautious Approach to Crypto from OCC, Fed, and FDIC
Meanwhile, Binance CEO CZ says as much as 97% of its users go through KYC and that regions like Singapore, France, and Dubai “understand the importance of attracting crypto businesses.”
The banking watchdog is set to announce an ever more cautious approach to regulating tokens as per Michael Hsu, the acting chief of the Office of the Comptroller of the Currency (OCC).
Hsu said this week that federal agencies, including the Federal Reserve, Federal Deposit Insurance Corp. (FDIC), and OCC are close to releasing a joint statement.
He described the results of their review, which was conducted by the government earlier this year, as a “crypto sprint” and said its conclusions would be far from industry-friendly.
“The agencies are approaching crypto activities very carefully with a high degree of caution,” Hsu said at a financial technology conference hosted by the Federal Reserve Bank of Philadelphia.
Hsu further said that guidelines issued by the OCC at the end of the Trump administration by then acting head Brian Brooks shouldn’t be interpreted as encouraging banks to get into crypto. The watchdog is poised to provide clarity on them, he added.
The interpretive letters were put out under former acting head Brooks, a crypto supporter who before joining the agency was the Chief Legal Officer of crypto exchange Coinbase.
“The forthcoming releases will clarify that safety and soundness is paramount,” Hsu said. “We will proceed carefully and cautiously and will hold banks to the same.”
Amidst the growing regulatory scrutiny, the leading crypto exchange Binance published a list of “fundamental rights,” arguing everyone should have access to financial tools like crypto. CEO Changpeng “CZ” Zhao told Bloomberg,
“We already shared this with different regulators, and we want the users to know as well. We have a much more detailed framework that we share with regulators directly.”
As much as 97% of its users went through KYC, CZ also shared that regions like Singapore, France, Dubai, or the UAE are all coming out with very friendly crypto regulations.
“They all understand the importance of attracting crypto businesses and encouraging innovations in the space.”
Likening crypto to the early days of the internet, CZ said, “People may have a tendency to view crypto as a single asset, which I think is a little bit misleading,” as “Crypto is a fundamental technology that can improve on many of the traditional asset types.”