A top Wall Street bank watchdog said the crypto industry has a long way to go in winning over regulators.
(Bloomberg) — A top Wall Street bank watchdog said the crypto industry has a long way to go in winning over regulators.
“Crypto today is an immature industry based on an immature technology,” Acting Comptroller of the Currency Michael Hsu said on Tuesday. He added that the comment wasn’t meant to be disparaging, but that the industry still needs to deal with “the unabating volume of scams, hacks, and fraud.”
Digital-coin giants have increasingly argued that blockchain technology lets them offer financial services akin to those that consumers expect from banks, brokerages and investment firms. Hsu said Tuesday that he’s concerned about integrating crypto into the traditional financial system without a more “accurate and complete” view of the risks.
“The largest crypto players today want to provide an increasingly broad range of services seamlessly under one roof for their customers,” Hsu said during the DC Fintech Week event. “While commingling these activities may offer convenience for consumers and cost savings for crypto firms, conflicts abound and the riskiest activity threatens the whole bundle.”
Since he took charge of the OCC last year, Hsu has focused on how banks should handle digital tokens. While they’ve downplayed systemic risks, US regulators have been sounding the alarm about the possible systemic dangers of widespread adoption of so-called crypto stablecoins.
In separate comments for a Harvard Law School event on Tuesday, Hsu said regulators should coordinate efforts to write rules that help mitigate some of the risk associated with digital assets. “Sharing information with peer agencies and seeking a common understanding of the risks and opportunities in the space can help ensure that regulatory standards remain high and the playing field stays level,” he said.
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