FDIC official urges better digital asset policy to protect US influence

FDIC official urges better digital asset policy to protect US influence


Bank customers and the US economy could lose opportunities if a weak approach is taken to regulate blockchain technology, Travis Hill, vice chairman of the US Federal Deposit Insurance Corporation, told an audience at the Mercatus Center think tank on March 11. It's already at risk, Hill said, and the FDIC shares the blame for it.

According to Hill, the simulation of bank deposits and other real-world assets enables financial transactions to be carried out at any time. In addition, it offers payment programs, which facilitate intraday repo transactions and improve settlement times for certain bond offerings and many other transactions. Consumers can also use programmable payments instead of hidden ones.

Among the many open questions about tokenization, Hill mentioned the use and disuse of unified ledgers, blockchain interoperability, and ownership rights when assets are moved on the blockchain. in addition –

“International standards are being established directly and indirectly, and with many non-U.S. states actively participating in this area, the United States risks losing influence at this critical level.”

Programmatic can reduce settlement risks and identify your client's processes, but it also allows consumers to move their assets faster, which complicates banking operations. To prevent this, use an “off” switch. Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch / Switch A switch is needed, he said.

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Source: @FDICgov via X

Regulatory agencies have tried to establish consistent policies in the past with little success, so “instead, agencies have established processes where institutions engage with their regulators on an individual basis,” Hill said.

Related: Inspector General wants FDIC to review crypto risk assessment process, guidance

Looking at the FDIC's regulations governing all transactions on blockchain — RWA or crypto — the same, Hill finds them cumbersome and unenforced.

“The institutions have spent months focusing on developing new technologies and systems in response to a long series of data requests. […] The message heard in most industries can be interpreted as don't bother trying.

Hill said guidance from regulators is needed to ensure that deposits are treated equally in any form. He criticized the Securities and Exchange Commission's (SEC) controversial Staff Accounting Bulletin 121 (SAB 121), which requires financial institutions to treat crypto assets differently than any other asset. The definition of crypto asset used in the announcement is broad enough to include token RWA, he said.

Magazine: Block by Block: Blockchain technology is changing the real estate market.

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