By Nathan Ferguson
Michael J. Hsu – the Acting Comptroller of Currency – stated that there is a requirement for coordination and collaboration of federal agencies with huge crypto intermediaries for a better understanding of the potential hazards associated with the spiking market of cryptocurrency with a cumulative valuation of nearly $2 trillion.
While talking on the subject of the regulation as well as the future of the cryptocurrency, at Transatlantic Finance Forum, he highlighted some of the platforms including NFT (nonfungible tokens) and crypto exchanges as well as metaverse where everyone can invest via the internet connection.
He added that the crypto is coming to the mainstream even though the uncertainty in the matter of law, regulation, hacks, scams, as well as the rest of the disruptive incidents. In his view, there are several points where there is a need for more concentration. As per him, the OCC (the Office of the Comptroller of the Currency) turned the attention of the banks towards the demonstration of their ability in advance of having federal permission for getting involved in the operations linked with cryptocurrencies.
The acting Comptroller additionally mentioned the mounting hazards within the crypto sector because those having USD-backed stablecoins hope that they are capable of redeeming the stablecoins thereof in return for the United States dollars. But those investors who doubt that their stablecoin holdings would be lost would initially attempt to redeem them instantly. In this scenario, he recommends the coordination between the federal agencies and the crypto intermediaries for reducing the bad effects caused by the decrease in trust over crypto.
Though banks, as well as trust institutions, have a thorough and flourishing history of safeguarding and custody of assets, the fundamental crypto technology as well as that linked governance with particular tokens pose a series of unique problems requiring cautious consideration and examination, he revealed. Jerome Powell (the chairman of Federal Reserve), while briefing last week, confirmed that the organization will issue a unique report over the digital currencies even though it has not reached the point where it should be.
It has been reported earlier that Powell referred to some ongoing modifications in monetary policy to be expected for addressing the policy spanning the probable issuance of a CBDC (central bank digital currency) in the US. In addition to this, he regrettably anticipated that the report would be presented and would be dropped in the impending weeks.