Fed Teases Master Accounts for Crypto Banks: Law Decoded, August 15-22
Last week, the United States Federal Reserve Board turned its attention to banks and crypto, providing (or promising to provide) several clarifications, including one quite long overdue. He announced that the final version of the guidelines for Reserve Banks to access main accounts and Reserve Bank services is ready.
For crypto, these guidelines offer the prospect of “the strictest scrutiny,” which non-federally insured institutions that do not have a holding company subject to Fed oversight would face. It remains unclear if crypto banks will finally have access to prime accounts under the new guidelines and how long they will have to wait.
At the same time, the Fed has made it clear that traditional banks that intend to manage crypto assets could not do so without closer consultation with regulators. Before making such a decision, it is recommended that you check state and federal laws and notify Fed oversight contacts in advance.
European Central Bank Intensifies Crypto Licensing Discussion
It’s not just the US financial regulator that has had a busy last week. The ECB laid the groundwork for the criteria it would consider when harmonizing crypto licensing requirements in Europe. Specifically, it will examine crypto firms’ business models, internal governance, and “fit and proper” assessments that apply to licensing other firms. In addition, it will rely on the national Anti-Money Laundering (AML) authorities and financial intelligence units of the respective countries to provide the data necessary for the assessment of potential risks.
A cease and desist letter for FTX
The Federal Deposit Insurance Corporation has issued cease and desist letters to five companies – FTX US, SmartAssets, FDICCrypto, Cryptonews, and Cryptosec – for allegedly making false statements about deposit insurance related to cryptocurrencies. The agency alleges that these organizations have misled the public about certain FDIC-insured cryptocurrency-related products and urges them to “take immediate corrective action to remedy such false or misleading statements.”
Colombia hopes to prevent tax evasion with national digital currency
The head of Colombia’s National Tax and Customs Authority, Luis Carlos Reyes, said the government would seek to create a digital currency to prevent illicit financial activities like tax evasion. However, the official did not specify what type of digital currency exactly the Colombian government will seek to launch, a central bank digital currency (CBDC) or rather a national asset-backed currency similar to Venezuela’s Petro digital currency project. .
CBDCs are “the only solution”
The introduction of digital money in the form of CBDCs appears to be the “only solution” that will guarantee a “smooth continuity” of the current monetary system. At least that’s what experts from the ECB think, who gathered information from 150 academic papers on the subject. The importance for central banks to achieve the right level of “support” for CBDCs is highlighted, and the authors also considered potential regulatory measures that could help CBDCs achieve their goals. Previously, the central bank compared the cross-border payment potential of CBDC, Bitcoin, and stablecoin, coming out in favor of CBDC.