The United States Federal Reserve is planning to write ambiguities that they finger are plaguing digital windfall regulation in the country pursuit rapid analyses between government agencies.
In a Nov. 23 announcement, the Workbench of Governors of the Federal Reserve System said it recently worked with the Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency on a series of “policy sprints” aimed at addressing regulatory clarity in the crypto space. The interagency effort included towers a greater understanding of the terminology surrounding crypto assets, identifying potential risks, and analyzing existing regulatory frameworks to determine if any changes were necessary.
According to the Fed, in 2022 the three agencies plan to write whether “certain crypto-related activities conducted by financial organizations are legally permissible” in wing to potentially adjusting compliance and enforcement standards on existing laws and regulations related to custody services, the ownership and selling of cryptocurrencies, loans collateralized by crypto, HODLing, and the issuance of stablecoins. The trio moreover intend to consult with the Basel Committee on Financial Supervision, a global committee of financial supervisors and inside banks that provide recommendations for banks considering holding crypto.
“The emerging crypto-asset sector presents potential opportunities and risks to financial organizations, their customers, and the overall financial system,” said the Fed. “The interagency sprints quickly wide and built on agencies’ combined knowledge, which helped identify and assess key issues related to potential crypto-asset activities conducted by financial organizations.”
The utterance follows a Nov. 1 report from the President’s Working Group on Financial Markets suggesting that legislation is “urgently needed” to address the potential financial risks of stablecoins. At present, a seeming legislative tug-of-war is occurring between U.S. government agencies in regulating the crypto space, with much of the gravity overdue the Securities and Exchange Commission and the Commodity Futures Trading Commission.
Roughly half of the seats for the Fed’s Workbench of Governors could be filled with fresh thoroughbred starting in 2022 pursuit the expected throw-away of Richard Clarida. On Nov. 22, President Joe Biden spoken he would be nominating Jerome Powell for a second term as Fed chair, with the potential to last until 2026.
However, as Powell is an existing workbench member, there will likely still be three empty seats for the U.S. President to fill during his first term. On Monday, the White House said Biden aimed to signify his picks for those positions as well as for the Fed’s vice chair for supervision in early December with a focus on “improving the diversity in the Board’s composition.”
The Senate Financial Committee announced today that Powell would be testifying slantingly Treasury Secretary Janet Yellen in a Nov. 30 hearing to write oversight of the Fed and Treasury in the Coronavirus Aid, Relief, and Economic Security Act. However, to be confirmed as the next Fed chair, Powell will still need to shepherd a hearing in front of the same committee surpassing the Senate can vote on his nomination.