Federal Reserve Board releases new guidance on banks in the Crypto
Regardless of whether a bank has deposit insurance, the Federal Reserve Board released a policy statement to support an even playing field for all banks under federal supervision.
It is made clear in the statement that both insured and uninsured banks under the Board’s supervision will be subject to the same restrictions on activities, including cutting-edge banking activities like those involving cryptoassets.
The fairness of treatment will prevent regulatory arbitrage and encourage an even playing field. The statement further restates that banks must conduct their operations in a safe and sound way and ensure that the activities they engage in are legal.
A bank, for instance, needs to have information systems, internal controls, and risk management procedures that are appropriate and sufficient for the type, scale, and hazards of its operations. A number of enquiries, notices, and suggestions from banks regarding prospective involvement in unique and unheard-of activities, such as those involving crypto-assets, have been sent to the Board in recent years.
If done safely, responsibly, and in accordance with consumer, anti-money laundering, and anti-terrorist financing legislation, this move would not prevent a state member bank from offering safekeeping services, in a custodial role, for crypto-assets.
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