Federal Reserve, FDIC, OCC to Establish Interagency Crypto Team
- The current head of the OCC has been in talks with the FDIC and the Federal Reserve about setting up an “interagency policy sprint team” focused entirely on crypto.
- The Federal Reserve Vice Chairman of Supervision, Randal Quarles, said the agencies are already engaged in a “joint effort” to come up with definitions related to crypto.
United States Federal Reserve Bank building on Constitution Avenue, Washington, DC, USA, 5 March 2009. Shutterstock
U.S. regulators could soon form an “interagency policy sprint team” focused on creating a unified banking framework for cryptocurrency.
During a virtual hearing of the House Financial Services Committee on 19 May, Rep. Tom Emmer asked what U.S. agencies are doing when it comes to cryptocurrency regulations. In their responses both the Federal Reserve Vice Chairman of Supervision, Randal Quarles, and the Federal Deposit Insurance Corporation chairman Jelena McWilliams focused more on the internal efforts of their agencies, such as requests for comment from industry players and studies of the technology.
The current head of the Office of the Comptroller of the Currency (OCC), Michael Hsu, however said he has been in contact with the Feds and the FDIC regarding the creation of an interagency team focused solely on crypto. Hsu said his approach was in response to his concerns that the regulatory community was “taking a fragmented, agency by agency, approach to the technology-driven changes”.
Quarles later said the three agencies have been working together on a joint effort to establish unified definitions related to crypto, and that the agencies could have “answers and joint views very quickly”.
Quarles also stated that the Federal Reserve has been expanding its efforts to explore Central Bank Digital Currency (CBDC), and is now more involved in CBDC research with central banks around the globe.
- 40 branches of Signature Bank will be reopened and operated as Flagstar Bank after it acquires $38.5 billion in non-crypto deposits and $12.9 billion in loans.
- The FDIC confirmed that the $4 billion in Signature Bank crypto deposits will be directly returned to customers who had opened a digital asset banking account.
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- The Federal Reserve and FDIC have issued a joint letter demanding the crypto lender remove “false and misleading” statements that it was FDIC-insured.
- The two regulators alleged that this claim “likely misled and were relied upon by customers who placed their funds with Voyager “.
- Custodia had already received confirmation from the Kansas Fed that its application was complete and had “no showstoppers”, but is yet to receive approval even after 19 months.
- Custodia’s complaint notes that a master account, which provides institutions with direct access to the Fed’s payment system, is “vital” for its business.