US Federal Reserve Board issues policy statement that limits crypto related activities of banks
The United States Federal Reserve Board has released a new policy and under its supervision both insured and uninsured will be subject to similar limits on bank activity including novel banking activity such as crypto related activity. The statement also clarifies that institutions will be subject to limits on certain activities that fall under the Office of the Comptroller of the Currency statute. By imposing limits on the activity of financial institutions, “the Board is not only seeking to promote a level playing field” but is also seeking to “limit regulatory arbitrariness”, according to the statement.
This policy which research becomes effective when it is published in the Register of Federal Bank and prompts the bank to ensure that their activity is above board and conducted through safe and sound means. This risk management process is achieved through internal controls as well as information systems and at the same time why it has decided to issue these, the Federal Board has said that the increase in the number of inquiries or proposals from financial institutions have been registered who wish to engage in non-traditional activity. In the recent past the Board has received a number of inquiries and notifications and proposals from banks regarding possible engagements in a variety of assets, including crypto, and the response specifies how it will evaluate any such inquiries and has long It has been considered in accordance with the prevailing practices. Meanwhile, the statement clarifies that the board’s latest action does not prevent state member banks or potential applicants from providing crypto-related asset safekeeping services and can only do so in a “safe and sound manner” from and is conducted in compliance with consumer, anti-money laundering and anti-terrorist financing laws.”
