US top regulator concerned Biden administration may roll back some crypto regulations. In an interview with CNBC last week, Brian Brooks, acting Comptroller of the Currency, shared several concerns on cryptocurrency regulations.
Brooks is the administrator of the federal banking system and chief officer of the Office of the Comptroller of the Currency (OCC). The OCC supervises almost 1,200 national banks, federal savings associations, and federal branches of foreign banks.
When asked to comment about the recent bitcoin bull run from the regulatory viewpoint, Brooks replied “I will tell you what I am worried about is all of this is happening in the environment where we are about to have a change of presidential administration, and there are calls on Capitol Hill to dismantle some of the regulatory protections we put in place for this stuff.”
The OCC green-lighted banks under its supervision to provide cryptocurrency custody services in July. Brooks explained that his agency “is trying to make it safer for people to custody in national banks” adding that “We’ve talked about banks supporting some of these stablecoin projects. If those protections aren’t in place, I really worry about the environments for these kinds of things. That’s what I’m most focused on. How do we preserve the safety for the people who participate in that market.”
He went on the explain that “We are at a really critical inflection point right now is what I’d tell you. It’s kind of a fork in the road. One path forward is that we find ways of addressing money laundering risks and we find ways of addressing terrorism financing which I think can be done. But we make this safe for the consumers and investors who participate, that’s why the banking system has such an important role to play,”
He maintained that “The other path which is a very real potential here is that we politicize some of these tech issues, whether it’s crypto or fintech more broadly. We politicize it by undoing all of the good work this administration has done to make it safer, to make it more real.”
Brooks then referred to a letter from Congresswoman Maxine Waters urging the Biden administration to scale back some of the OCC’s regulations. Among the recommendations was the revocation of authorising national banks and federal savings associations to provide crypto custody services. Regarding the suggestions Waters put forth in her letter, Brooks said, “If we do those things, then I’m not sure we have enough of a foundation to move forward. It’s all about consolidating regulatory gains and consumer protection that we are trying to put in place. That’s got to stick around.”
He further detailed that “The role of the government is to make sure that markets are well-regulated and well-organized so that people who are transacting know that they are transacting with good people and not bad people.” He emphasized, “Part of that means that, as in any financial markets, there has to be tracing and no anonymity.”
The acting comptroller of the currency clarified that people who hold cryptocurrencies will need to be made aware that they are not going to lose them. “That’s why it’s important to people that they be able to custody their assets in a bank, for example, the same way you might custody your stock certificates or any other assets that you own,” Brooks opined.
[image: Gayatri Malhotra]
