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US Senator Elizabeth Warren is trying to curb banks offering retail crypto services

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Massachusetts Democrat Elizabeth Warren is circulating a letter among her Senate peers urging a key U.S. banking regulator to withdraw the legal guidance that has underpinned Wall Street’s push into crypto.

s Warren wants the Office of the Comptroller of the Currency (OCC) to draw a set of Trump-era interpretations that paved the way for banks to offer services like crypto custody to customers. The letter, a draft of which was reviewed by Bloomberg News, calls on the OCC to work with the Federal Reserve and the Federal Deposit Insurance Corporation to replace them with an approach “that adequately protects consumers and the safety and soundness of the banking system.” .

Ms. Warren is currently asking colleagues to sign the letter and plans to send a final version to the OCC’s acting head, Michael Hsu, soon, an aide to the senator said.

In response to a request for comment on the draft letter, an OCC official referred to Mr Hsu’s previous remarks, including a recent speech in which he advocated the regulator’s “cautious and cautious” approach to banks trying to deal with crypto.

After several high-profile blasts cost investors billions of dollars recently, pressure has mounted on lawmakers and regulators to crack down on corners of the crypto market. Ms. Warren, who serves on the Senate Banking Committee, is among lawmakers most critical of the asset class.

“Cryptocurrencies are highly volatile assets that offer little, if any, protection to retail investors,” the letter reads.

Recent turmoil, including the collapse of stablecoin TerraUSD and the bankruptcy of several digital asset firms, have heightened concerns that OCC’s past actions may have exposed the banking system to “unnecessary risk,” the letter said.

The OCC under the Biden administration confirmed in November that banks can engage in certain crypto activities, but only after receiving written approval from their regulator. The letter states that while these updated guidance were aimed at reducing risk, they did not go far enough.

“We are concerned that the OCC has not adequately addressed the deficiencies of previous interpretative letters and the risks associated with crypto-related banking operations, which have become more serious in recent months,” the letter reads.

While Wall Street banks have shown more interest in crypto, they have remained largely on the sidelines, in part due to ongoing legal issues in the US.

The letter concludes with a series of questions for the regulator, including asking the OCC to identify the regulated banks that are currently offering crypto-related services and asking for the estimated total dollar value of these activities.

https://www.independent.ie/business/world/us-senator-elizabeth-warren-seeking-to-rein-in-banks-that-offer-retail-crypto-services-41890771.html US Senator Elizabeth Warren is trying to curb banks offering retail crypto services

Fry Electronics Team

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