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OCC’s Hsu Says Banks Need Caution With Crypto as Economy Ups Risks

The recent crypto troubles have only added to Office of the Comptroller of the Currency (OCC) Acting Chief Michael Hsu’s resistance to allow lenders to have unrestricted access to digital assets markets, CoinDesk wrote Thursday (June 23).

Hsu has been reluctant to add crypto to the wider financial system, and this has been a big hurdle in the industry push toward more mainstream regulation. So far, he’s stuck to his guns.

CoinDesk quoted him to have said there are “some vulnerabilities and risks” that warrant a “cautious and careful approach.”

Hsu spoke on a call with reporters about the OCC Semiannual Risk Perspective, which highlighted how digital assets could be a danger for lenders.

“It kind of reinforced where we’ve been this whole time,” Hsu said.

He gestured to earlier guidance from the agency, which instructed bankers to get approval from the OCC before delving into more crypto activities. He added that he intended to go for a more deliberative and careful approach to crypto, as he’s done so far.

Regulation in crypto has been a hot button topic, with various agencies lobbying for more control over it all. PYMNTS wrote of a recent bipartisan bill between Sens. Cynthia Lummis and Kirsten Gillibrand, which would have defined most digital assets as commodities rather than securities.

See also: Bill Giving CFTC Regulatory Control Would Reshape Crypto

That had the Commodity Futures Trading Commission (CFTC) pleased, while the Securities and Exchange Commission (SEC) was less than enthused.

The two agencies have sparred over the right to regulate crypto over the last year. SEC Chair Gary Gensler said crypto is the “Wild West” of finance, saying almost all tokens are securities.

But at the news of the proposed bipartisan bill, CFTC Chair Rostin Behnam said the bill was a “very good job,” and said there would be a lot to talk about over what constitutes a commodity and a security.

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