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Brian Brooks, the acting head of the U.S. Office of the Comptroller of the Currency, said crypto regulation could either focus on safety for participants or could undo all progress.
The latter half of 2020 has seen record Bitcoin (BTC) prices and a number of key regulatory developments, such as the Office of the Comptroller of the Currencyâs, or OCCâs, approval of crypto custody at national banks. Legal policy for the digital asset industry currently faces an uncertain future, however, as a number of government roles are set to change heading into 2020, according to former Coinbase exec and current acting leader of the OCC, Brain Brooks.Â
âI canât speak to the specific price movement, but Iâll tell you what Iâm worried about,â Brooks told CNBC in a Friday interview, fielding a question on his primary interest regarding Bitcoinâs blazing highs. Brooks explained:
âAll of this is happening in an environment where weâre about to have a change of presidential administrations and thereâs calls on Capitol Hill to dismantle some of the regulatory protections weâve put in place with this stuff.â
Recent weeks have shown a number of crypto regulatory proposals, including rumors of a ban or limitations on self-custodied crypto wallets. Multiple congressional leaders responded with concern against the possible action. A new bill proposal also seeks to place stringent regulatory requirements on stablecoins.
âMy agency has tried to make it safer for people to custody in national banks,â Brooks said. âWeâve talked about banks supporting some of these stablecoin projects,â he added. âIf those protections arenât in place, I really worry about the environment for these kinds of things.â Brooks pointed toward a desire for retaining safety within the crypto space.
Brooksâ strides toward crypto industry safety and growth were met with recent backlash expressed in the form of a letter from several congresspeople in early November. Several government leaders lobbied that the OCC concentrated too much on the sector under Brooksâ watch.
In his CNBC interview, Brooks noted crypto is at a crossroad in terms of regulation. âWeâre at a really critical inflection point right now,â Brooks said. âItâs kind of a fork in the road.â The OCC leader said one road looks to increase safety for people in the market by targeting the ecosystem surrounding illegal crypto transactions. He described banks as vital to the equation.
The second road looks more dire for the crypto space. âThe other path, which is a very real potential here, is that we politicize some of these tech issues, whether itâs crypto or fintech more broadly,â Brooks explained, adding:
âWe politicize it by undoing all of the good work this administration has done to make it safer, to make it more real, and if we do those things, as for example, Chairwoman Maxine Watersâ letter recently suggested, then Iâm not sure if we have enough of a foundation to move forward here. So itâs all about consolidating regulatory gains and consumer protections that weâve tried to put in place.â
In early December, Waters sent out a letter requesting a halt on financial regulatory developments until government positions are solidified in 2021. Waters made a splash in the crypto space back in 2019, when she halted Facebookâs Libra (now called Diem) after its white paper release.
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