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Office of the Comptroller of the Currency Pauses On New Bank Charters With New Barriers To Using Crypto

The Office of the Comptroller of the Currency (OCC), the nation’s regulator of large banks like J.P. Morgan Chase and Wells Fargo. Notably, issuing an Interpretive Letter 1179, brings up supervisory barriers. Of course, with targets on slowing the entry of the fast-growing cryptocurrency industry into the U.S. banking system.

More so, Acting Comptroller Michael Hsu effectively issues a rebuke. Additionally, to the work of previous Acting Comptroller Brian Brooks through putting greater risk management thresholds. Ie. before any bank conducts crypto-asset bank activities.

Notably, According to Acting Comptroller Hsu,
“…Because many of these technologies and products present novel risks,..”
“banks must be able to demonstrate that they have appropriate risk management systems…”
“and controls in place to conduct them safely…”
“This will provide assurance that crypto-asset activities are taking place inside of the federal…”
“regulatory perimeter is being conducted responsibly.”

So, Acting Comptroller Hsu concludes.

Lastly, the Interpretive Letters are already issuing to banks in 2020, Interpretive Letters 1170, 1172, and 1174. Which are already on the list that safety and soundness principles should be intact. Especially, by banks using cryptocurrency as part of their permissible bank activities.

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