Jelena McWilliams, chair of the Federal Deposit Insurance Corporation (FDIC), said on Tuesday that US bank regulators are working on precise guidelines for banks interested in engaging with bitcoin and other cryptocurrencies.
“I think that we need to allow banks in this space, while appropriately managing and mitigating risk. If we don’t bring this activity inside the banks, it is going to develop outside of the banks…The federal regulators won’t be able to regulate it,” Ms McWilliams told Reuters.
So far, US regulators have not issued any guidelines on how banks could hold crypto assets.
Despite the lack of guidelines, some major banks and financial services in the US have not shied away from offering services related to digital assets.
Mastercard announced on Monday that it would soon allow merchants, banks, and fintech operators in the US to offer cryptocurrency services and products on its network. In July, JPMorgan Chase allowed its wealth management clients access to crypto funds.
Randal Quarles, the federal reserve vice chairman for supervision, said in May that three US agencies, including the Office of the Comptroller of the Currency and the FDIC, were working together on a “sprint” on cryptocurrency regulation.
Meanwhile, the Federal Reserve is also working on a paper on stablecoins and the White House has banded together a working group to look at cryptocurrency rules.
If a federal roadmap comes to fruition, it could spring a new wave of bitcoin and crypto adoption and facilitate more trading as currencies or as collateral assets for loans.
This could also open the opportunity for banks in the US to hold bitcoin in their balance sheets with the potential to counteract the debt they issue.