The Board of Governors of the Federal Reserve System announced that it recently worked with the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency on a series of The Sprint Policy aimed at providing regulatory clarity in cryptocurrencies . spatial. The interdisciplinary efforts include building a better understanding of the terminology surrounding crypto assets, identifying potential risks and analyzing existing regulatory frameworks in order to identify any changes.
According to the Fed, the three agencies plan to address whether “certain crypto-related activities of banking institutions are legally permissible” by 2022, in addition to possibly regulating compliance and enforcement standards with applicable laws and regulations regarding custody services that Buying and selling cryptocurrencies, crypto-secured loans, HODLing and stablecoin issuance. The trio also intends to consult with the Basel Committee on Banking Supervision, a global committee of banking regulators and central banks that makes recommendations for banks considering holding money.
“The emerging crypto asset sector presents potential opportunities and risks for banking institutions, their customers and the financial system as a whole,” the Fed said. “Interdisciplinary sprints develop rapidly and build on the combined knowledge of agencies and help to identify and evaluate key problems in connection with the operational potential of crypto assets realized by banking institutions.”
The announcement comes after a November 1 report by the President’s Working Group on Financial Markets, which found that legislation was “urgently needed” to address the potential financial risks of stablecoins. Right now, a legislative tug-of-war seems to be brewing between U.S. government agencies over regulating the crypto space, with much of the force behind the Securities and Exchange Commission and the U.S. Securities and Exchange Commission, Commodity Futures Trading Department.
Related: Chairman Jerome Powell says the Fed is undecided about the digital dollar
Around half of the seats on the Fed’s Board of Governors could be filled with fresh blood from 2022 following the expected departure of Richard Clarida. On November 22, President Joe Biden announced that Jerome Powell would be nominated for a second term as Fed chair, possibly until 2026.
However, since Powell is an existing board member, it is likely that the US president will have three vacancies left in his first term. On Monday, the White House said Biden would announce his selection for these positions, as well as the Fed vice chairman, who will be overseen in early December, with an emphasis on “enhancing the compositional diversity” of the board division.
The Senate Banking Committee announced today that Powell and Treasury Secretary Janet Yellen will be in a hearing on the 30th. However, to be confirmed as the next Fed chairman, Powell must attend a committee hearing before the Senate vote on his nomination can.