In this regard, McWilliams indicated that it is important that US banks integrate these assets, since if it is not done soon, there will be other institutions outside the law that will do so effectively.
The president of the Federal Deposit Insurance Corporation (FDIC), Jelena McWilliams, assured that officials from various institutions are trying to design clear guidelines for banks and clients, precisely so that financial institutions can provide support for the storage of cryptocurrencies and other services based on these assets.
This was commented by the president of the US regulatory entity, which she pointed out during an interview conducted by the team of Reuters that a group of US banking regulators are working on the construction of a roadmap for banks to have a better interaction with cryptocurrencies, thus providing new lines of services for all interested customers.
According to McWilliams, this could include much clearer rules on the custody of cryptocurrencies by banks, opening the way for these assets to serve as collateral in case of loans, or even handling a special balance as would happen with currencies and more traditional assets.
Regarding the need to do this, McWilliams stated:
“I believe that we must allow banks to enter this space, while the risk is properly managed and mitigated … If we do not carry this activity within the banks, it will develop outside of them … Federal regulators will not be able to regulate it.”
Incorporating cryptocurrencies into the banking sector
According to Reuters, McWilliams statements show that regulators are addressing issues associated with cryptocurrencies with greater seriousness and speed, especially at a time when these assets are attracting the attention of large numbers of people both inside and outside the United States. In this case, the work team seeks to align the FDIC, Federal Reserve (FED) and Office of the Comptroller of the Currency (OCC) in the same direction, to clarify the regulatory aspects that would apply to the management and use of these assets from a more general perspective.
Currently, analysts and experts on the subject indicate that the regulatory landscape in the US is quite murky, which is why representatives of the SEC, the EDF, the CFTC and other bodies have highlighted the need for much more effective regulations, in order to prevent cryptocurrencies from representing an opportunity for bad actors interested in perpetrating illicit acts.
As for banks and cryptocurrencies, some local institutions have already begun to venture and offer services for these assets without having the respective regulatory clarity. For this and for the reasons mentioned above, McWilliams highlights the need to at least produce a first guide so that interested entities can do this correctly, and added:
“My goal in this interagency group is basically to provide a way for banks to act as custodians of these assets, use cryptocurrencies … At some point, we are going to address how and under what circumstances banks can keep them on their balance sheets.”
The challenges on this path
Although the goal is quite clear, McWilliams also indicated that this path is full of challenges, some of which historically have been highlighted by critics and analysts in different sectors.
The clearest challenge for the representatives of the regulatory bodies has to do with the volatility in the price of Bitcoin and the main cryptocurrencies, which makes it very difficult to list it as a collateral asset, as well as to include it in an account balance if it is found based on US dollars.
In this regard, McWilliams commented:
“The problem is … the valuation of these assets and the fluctuation in their value that can be almost daily … You have to decide what type of capital and liquidity treatment to assign to these balance sheet holdings.”
Version by Angel Di Matteo / DailyBitcoin
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