The Federal Reserve Board’s approach to overseeing banking innovation seeks to ensure activities that present fundamentally the same risks are regulated in the same way, a Fed regulator is slated to tell Congress today.
Testimony: In prepared testimony for today’s House Financial Services subcommittee hearing on financial innovation, Fed Division of Supervision and Regulation Director Michael Gibson says novel products or services that raise the same risks as a traditional activity should be subject to the same regulation, even if they are based on new technology.
Crypto Focus: Gibson’s testimony also says that while cryptoassets may improve efficiencies and increase access to financial services, they pose risks related to governance and risk management, illicit finance, and legal uncertainties around issues such as settlement finality and ownership rights.
ICBA View: ICBA has called on policymakers to ensure new policies directed at the crypto sector fully reflect its risks and to ensure protecting national security and implementing anti-crime measures are primary drivers of crypto policymaking and regulation.
More: Recent Main Street Matters posts from ICBA Senior Vice President of Digital Assets and Innovation Policy Brian Laverdure cover recent crypto collapses, the evolving regulatory environment for digital assets, and the policy debate over treating cryptoassets as securities or commodities.