The currency’s new Acting Comptroller Michael Hsu has requested a review of cryptocurrency standards set by the leading U.S. banking regulator. He is also asked to “re-evaluate all conditional national trust deeds and stop approving additional charters for non-banks” during the review.
Top banking regulator to review crypto policy
Michael Hsu, the new administrator of the Bundesbank system and Chief Executive Officer of the Office of the Currency Auditor (OCC), has requested a review of the regulatory standards for cryptocurrencies. Hsu took office on May 10th.
The OCC is an independent office of the US Treasury Department. It charters, regulates and monitors all national banks and federal savings banks as well as branches and agencies of foreign banks.
Hsu announced his plans for cryptocurrency in front of the Financial Services Committee on Wednesday. “The focus at the OCC was on promoting responsible innovation,” he began. “For example, we set up an Office of Innovation, updated the framework for chartering national banks and trust companies, and interpreted crypto-custody services as part of the banking business.”
The new Acting Comptroller commented: “I have asked the staff to review these measures.”
Shortly after I started, I asked for a review of key regulatory standards and matters pending with the agency. These elements include … letters of interpretation and instructions on cryptocurrencies and digital assets as well as pending licensing decisions.
“Each review takes into account a range of internal and external views, the effects of changed circumstances and a range of alternatives,” he said.
Former Acting Comptroller Brian Brooks previously warned that some of the cryptocurrency guidelines issued by the OCC under his leadership would be rolled back.
Meanwhile, Senator Sherrod Brown, who serves as chairman of the Senate Banking, Housing and Urban Affairs Committee Sherrod Brown, sent Hsu a letter on Wednesday about the OCC-issued cryptocurrency regulation.
Brown expressed concerns “about a number of national deeds of trust issued by the previous leadership of the OCC”. He wrote: “Shortly after former acting comptroller Brian Brooks left the OCC to join Binance, a cryptocurrency exchange, several non-traditional firms specializing in digital and cryptocurrency activities – including Paxos, Protego and Anchorage – received from the OCC conditional national trust certificates. ”
The Senator believes that “the OCC is incapable of regulating these companies as compared to traditional banks,” emphasizing:
A company that cannot meet the strict requirements of other banks should not be allowed to present itself to the public as a bank.
Noting that “former acting auditor Brian Brooks actively encouraged cryptocurrency companies to apply for a national trust charter because it had” relatively simple requirements “and” is just a quicker charter, “Brown stated that” those charter approvals are not could only lead customers to underestimate the risks associated with these assets, but this could undermine confidence in the security and stability of the entire banking system. “
The Senator’s letter to the Acting Comptroller concludes: “I urge you to reevaluate all conditional national trust deeds and to stop approving additional charters for non-banks during the review.”
I urge you to review the procedures and guidelines used in the OCC for assessing and approving the Anchorage, Paxos and Protego charters to ensure that the OCC’s monitoring and licensing standards remain both rigorous and fair among charter applicants.
Do you think the OCC will work out stricter crypto rules after the review? Let us know in the comments below.
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