Whenever a government changes hands, there is a good chance that certain gains will be called into question for the sake of different visions. While economic policies are often the first areas to be changed, laws and regulations are no exception. Despite shortcomings, the regulatory framework for the crypto space offered consumers good protection under the Trump administration. This could now weaken with the arrival of the Biden administration.
The fear of a decline in consumer protection
Director ofOCC (Office of the Comptroller of the Currency), Brian brooks addressed the evolution of cryptocurrency regulation in a lengthy interview for CNBC. He recalled in particular that the body had campaigned for banks to offer a cryptocurrency custody service to consumers. He justified this measure by the need to democratize this service and to guarantee all consumers the security of their assets. But the decision that the Trump administration approved could be overturned by the new administration as he signified it.
“I’ll tell you what worries me: all of this is happening in a context where we are about to change presidential administration and where calls are being made on Capitol Hill to dismantle some of the regulatory protections we have put in place for this sort of thing »He declared. He went on to explain that regulation could take two paths with the change looming. A first way would consist in dealing with the risks of money laundering and the financing of terrorism to reassure consumers and investors in line with what is already being done. The second path would consist of politicize these decisions even if it means denying all the good work done by the previous administration.
Policy changes that will ultimately hurt consumers
Speaking of pressure from the Capitol, Mr. Brooks made particular reference to the letter from the deputy Maxine Waters to the Biden government. She urges the latter to reverse some of the regulations put in place by the OCC. These include the authorization given to national banks and federal savings associations to provide crypto custody services.
“It’s a real political debate right now. People may not realize it, but there are leaders in Congress urging the new Biden administration to cut some of those protections. I think it’s in the name of politics, not in the name of investor protection He regretted.
The exit of Mr. Brooks therefore comes to warn the whole community, but also the future administration of the risk incurred with the new direction which is looming. With the alert now on, all eyes are on the Biden administration to see if its decisions will be right for consumer protection.