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Regulators Publish Joint Statement Summarizing Results of Inter-agency Crypto Sprint

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The inter-agency crypto-asset policy sprint initiative has finally taken off. This morning the Federal Reserve Board, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency (collectively, “the Agencies”) issued their first joint statement (the “Statement”) summarizing progress on a series of crypto-asset[1] policy sprints and revealing next steps.

The Statement is a continuation of an effort initiated by the “interagency sprint team,” a group of banking regulators convened earlier this year to examine the cryptocurrency sector. After conducting a series of “policy sprints” where internal agency staff reviewed issues and existing policies, the Agencies identified areas where “additional public clarity is warranted.”

Accordingly, in the coming year, the Agencies say they plan to focus on issues related to legal permissibility, safety and soundness, consumer protection and compliance with existing legal and regulatory obligations. In particular, these issues include:

  • Crypto-asset safekeeping and traditional custody services.
  • Ancillary custody services.
  • Facilitation of customer purchases and sales of crypto-assets.
  • Loans collateralized by crypto-assets.
  • Issuance and distribution of stablecoins.
  • Activities involving the holding of crypto-assets on balance sheet.
  • Bank capital and liquidity standards and related engagement with the Basel Committee on Banking Supervision.

While other issues (e.g., security, privacy) are relevant, it is telling that the Statement chose the above activities to underscore.

Check out our other recent writings on the cryptocurrency sector:

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This post was originally published on the Debevoise Data Blog, available here. To subscribe to the Debevoise Fintech Blog, click here.

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[1]      The Statement defines “crypto-asset” as “any digital asset implemented using cryptographic techniques.”

Author

Alison M. Hashmall is a counsel in the firm’s New York office and a member of Debevoise's Banking Group. Ms. Hashmall’s practice focuses on advising domestic and non-U.S. banking organizations and other financial institutions on a wide range of bank regulatory, policy, and transactional matters and cryptocurrency-related issues. She can be reached at ahashmall@debevoise.com.

Author

Caroline Swett is a partner and a member of Debevoise’s Financial Institutions and Banking Groups. She can be reached at cnswett@debevoise.com.

Author

Chen Xu is a counsel of the Banking Group and is resident in the New York office. His practice focuses on advising banking clients on a wide range of bank regulatory, policy and transactional matters and cryptocurrency-related issues, including in the areas of regulatory capital, liquidity and stress testing. Mr. Xu is recognized as an “associate to watch” by Chambers USA (2021), where clients say that he is “a tremendous resource” who is “just exceptional at working through the real technical nuances of capital rules and the other quantitative aspects of technical regulations.” Mr. Xu received his J.D. from Columbia Law School in 2013 and his B.A. from University of California, Berkeley in 2010. He can be reached at cxu@debevoise.com

Author

Taylor Richards is a corporate associate and a member of Debevoise's Banking Group. She can be reached at tmrichards@debevoise.com.

Author

Amy Aixi Zhang is a corporate associate and a member of Debevoise's Banking and Financial Institutions Groups. She graduated from Harvard Law School in 2020. During her time in law school, Ms. Zhang was President and Co-Founder of the Harvard Law School Blockchain and FinTech Initiative. She authored “Regulating Crypto Assets: Securities and Commodities,” a case study published in FinTech Law: The Case Studies by Harvard University Press in July 2020 and was a fellow at a mortgage servicing fintech company before joining Debevoise in 2020. She can be reached at aazhang@debevoise.com.

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