Federal Deposit Insurance Corporation (FDIC) Chair Jelena McWilliams said earlier this week that U.S. banks should be allowed to hold cryptoassets.
The Federal Deposit Insurance Corporation (FDIC) is “an independent agency created by Congress to maintain stability and public confidence in the nation’s financial system.” To achieve its goals, the FDIC “insures deposits; examines and supervises financial institutions for safety, soundness, and consumer protection; makes large and complex financial institutions resolvable; and manages receiverships.”
McWilliams was “sworn in as the 21st Chairman of the FDIC on June 5, 2018.” She “serves a six-year term on the FDIC Board of Directors, and is designated as Chairman for a term of five years.”
Her comments about crypto were made on Tuesday (October 26) during an interview with Reuters in Las Vegas at FinTech conference Money20/20 (held 24-7 October 2021).
McWilliams explained to Reuters how U.S. regulators are exploring the options for banks to hold cryptoassets. This could mean “clearer rules over holding cryptocurrency in custody to facilitate client trading, using them as collateral for loans, or even holding them on their balance sheets like more traditional assets.”
She said:
“I think that we need to allow banks in this space, while appropriately managing and mitigating risk.
“If we don’t bring this activity inside the banks, it is going to develop outside of the banks. … The federal regulators won’t be able to regulate it.“
According to Reuters, McWilliams’ comments provide the “fullest picture yet” of what U.S. regulators are exploring as part of their “sprint” to investigate cryptocurrency. The team’s goal is to coordinate policy among the three primary U.S. banking regulators: the FDIC, Federal Reserve and Office of the Comptroller of the Currency.
McWilliams said her aim in the interagency group was “to basically provide a path for banks to be able to act as a custodian of these assets, use crypto assets, digital assets as some form of collateral.”
Disclaimer
The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, or other advice. Investing in or trading cryptoassets comes with a risk of financial loss.
