Michael J. Hsu, the Acting Comptroller of the Currency, stressed the importance of collaboration and coordination with significant cryptocurrency intermediaries. To have a better understanding of the threats that the $2 trillion bitcoin economy poses.
Hsu mentioned the numerous venues during his presentation at the Transatlantic Finance Forum on “The Future of Crypto-Assets and Regulation.” Nonfungible tokens (NFT), cryptocurrency exchanges, and the metaverse Anyone with access to the internet can invest, with the following additional information:
“Despite legislative and legal uncertainties, as well as a slew of scams, hacks, and other disruptive events, cryptocurrency has become popular. This raises a slew of issues for financial regulators like myself. What should be the focus of regulatory attention? So, what are your recommendations? Who is it that is in charge? Why?”
The Office of the Comptroller of the Currency (OCC), according to Hsu, has reminded banks that they must demonstrate competency before receiving regulatory approval to engage in crypto activities.
Holders of USD-backed stablecoins believe they may redeem their stablecoins for US dollars on demand, at par, with no questions asked, according to the acting Comptroller.
“However, what if that trust were to erode or disappear? Stablecoin holders would rationally redeem as soon as possible. If they knew they had the best chance of receiving their money back.”
Collaborating with crypto intermediates is vital
To mitigate the implications of a lack of faith in crypto, Hsu proposes collaborating with crypto intermediates. “Banks and trust companies have a long and successful history of custody and safeguarding assets”. However, he added, “the technology underlying crypto and the accompanying governance with some tokens create a variety of fresh concerns. That necessitate careful research and evaluation”.
Despite not being “exactly where we wanted to get it”, Federal Reserve chair Jerome Powell stated during his confirmation hearing last week that the agency will release a fresh report on digital currencies.
As previously reported, Powell emphasised ongoing monetary policy reforms. Which are expected to address policies around the prospective implementation of a central bank digital currency in the US:
“The report is truly ready to go, and I believe we’ll be dropping it — I hate to say it — in the coming weeks.”