The top US banking regulator fears that the Biden government could pull back some cryptocurrency regulations to protect consumers. This includes that national banks can keep crypto assets that have been set up during the Trump administration.
The Biden administration could change the US crypto regulations
Acting currency auditor Brian Brooks shared some concerns about cryptocurrency regulations in an interview with CNBC last week.
Brooks is the Federal Banking System Administrator and Chief Officer of the Office of the Comptroller of the Currency (OCC). The OCC oversees almost 1,200 national banks, federal savings banks and federal branches of foreign banks.
He was asked to comment on the recent Bitcoin bull run from a regulatory perspective. Brooks replied:
I’ll tell you, what worries me is that all of this is happening in the environment in which the presidential administration is about to be changed, and Capitol Hill is being asked to dismantle some of the regulatory protections in place for it.
The OCC, under its oversight, gave the green light to provide cryptocurrency management services in July. Brooks said his agency is “trying to make safekeeping at national banks”. He added, “We talked about banks supporting some of these stablecoin projects. When these protections aren’t in place, I really worry about the environment for this kind of thing. That’s what I focus on most of the time. How do we keep the people who participate in this market safe? “
He noted, “We are at a really critical turning point right now, I would tell you. It’s kind of a fork in the road. “He outlined two avenues for crypto regulation. “One way forward is that we find ways to address money laundering risks and ways to address terrorist financing that I think can be done. But we make this safe for the participating consumers and investors. That’s why the banking system plays such an important role, “he said, adding:
The other path, which has very real potential here, is for us to politicize some of these technical issues, be it crypto or fintech in the broader sense. We are politicizing it by undoing all the good work this government does to make it safer and more real.
Brooks then referred to the letter from Congressman Maxine Waters asking the Biden administration to withdraw some of the regulations put in place by the OCC. One of the recommendations was to revoke the permission of national banks and federal savings banks to offer crypto custody services. Regarding the suggestions Waters made in her letter, Brooks said, “If we do these things, I’m not sure we have enough foundation to move forward. It’s about consolidating regulatory gains and consumer protection that we want to implement. It has to stay. “
He went on to say, “The role of government is to ensure that markets are well regulated and organized so that people who conduct transactions know that they are doing business with good people and not bad people.” He emphasized: “Part of it means that, as in any financial market, there has to be traceability and no anonymity.”
The acting currency auditor made it clear that people who own cryptocurrencies need to know that they will not lose them. “That’s why it’s important for people to be able to keep their assets in a bank, just like you can keep your stock certificates or other assets you own,” said Brooks.
“This is a real political debate right now,” said Brooks, emphasizing:
People may not realize this, but there is leadership in Congress calling on the incoming Biden administration to take some of these safeguards back. I think in the name of politics, not in the name of investor protection.
Recently the Financial Crimes Enforcement Network (FinCEN) proposed a new regulation for wallets for cryptocurrencies. Public comments can be submitted before January 4th. Meanwhile, the US Securities and Exchange Commission is taking action against a number of crypto firms that sell unregistered securities, including Ripple Labs.
Do you think the Biden administration will reset some crypto rules? Let us know in the comments below.
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