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An online future for finance is inevitable, says OCC’s Brooks

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The departing leader of the Office of the Comptroller of the Currency is convinced that the future of finance is blockchain-native, per a conversation with crypto analytics firm Elliptic on Wednesday.

Described by Elliptic CEO Simone Maina as “a fairy godfather to the crypto industry,” Brooks has been a leading light in U.S. federal policy towards crypto since taking over for Comptroller Joseph Otting in May. Today, he outlined views that follow an opinion piece he wrote for the Financial Times yesterday.

Namely, Brooks took the opportunity to promote his vision of an OCC that checked algorithms rather than bankers for responsible behavior: “Imagine a world where we’re granting charters to softwares as opposed to individuals.”

The vision falls in line with Brooks’ overall work to push forward a national charter for non-depository financial institutions — which detractors have called a “nonbank charter.” In broader terms, the Acting Comptroller saw the technological change that he is trying to prepare laws for as inevitable:

“My thesis is that it is inevitable that the future of finance will go on the internet like information did 25 years ago, and we need to prepare banks for that world and we need to prepare banking charters for that world.”

Describing recent political deplatforming from social media and payments processors as “chilling,” Brooks went on to argue that: 

“Crypto is about freedom. There is no CEO to deplatform. If you didn’t believe freedom mattered last week, you should believe it matters today.”

However, Brooks confirmed what has long been suspected: His time at the OCC will end with the incoming Biden administration. “There will be another comptroller and it won’t be me,” he said.



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Regulation

Senate committee votes unanimously in favor of Yellen as Treasury Secretary

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Janet Yellen, the former Chair of the Federal Reserve, is one step closer to earning the nomination of Treasury Secretary. 

The Senate Committee on Finance voted unanimously to approve Yellen’s nomination Friday morning, setting the stage for a full Senate vote. Republican Senator Chuck Grassley said he hoped the GOP’s backing would signal “bipartisan” support under the new Democratic administration.

Fellow Republicans said they backed Yellen despite disagreeing on several of her policy stances. The general consensus was that she was exceptionally qualified for the job.

Committee members hoped for a full Senate vote to confirm Yellen’s appointment on Friday but as of publication time, that has yet to materialize.

If confirmed as Treasury Secretary, Yellen would become a key member of President Biden’s Cabinet and will act as a principal adviser on economic issues and fiscal policy. She would also be the first woman to occupy the post.

At her Senate confirmation hearing Tuesday, Yellen called for “big action” on the Covid-19 crisis. She said:

“Economists don’t always agree, but I think there is a consensus now: Without further action, we risk a longer, more painful recession now — and long-term scarring of the economy later.”

Yellen headed the Federal Reserve between 2014 and 2018, becoming the first woman to do so. Under her leadership, the central bank made its first attempt at normalizing monetary policy — an initiative that was later curtailed under Jerome Powell.

The cryptocurrency industry has been following Yellen’s nomination process closely. The former Fed chief has given mixed signals on digital assets. On one hand, she has touted Bitcoin (BTC) and other digital assets as an important innovation in optimizing global transactions. On the other, she has raised concerns over crypto’s role in money laundering and illicit financing.

The final days of the Trump administration induced heavy anxiety for the cryptocurrency industry after then-Treasury Secretary Steven Mnuchin tried to fast-track new regulations targeted self-hosted crypto wallets.

In his first day in office, President Biden placed a general freeze on all federal-agency rulemaking, effectively blocking several Trump-era policies from advancing. The proposed crypto wallet regulation was among them.