U.S. regulator says banks can use stablecoins, connect to blockchains
06 Jan 2021

Cryptocurrency prices briefly popped late Monday, after a federal banking regulator said in an interpretive letter that U.S. financial institutions are allowed to use stablecoins for payment activities, and can participate as nodes in a blockchain.

The letter from the Office of the Comptroller of the Currency is the latest crypto-friendly move from the Treasury Department office.

“Our letter removes any legal uncertainty about the authority of banks to connect to blockchains as validator nodes and thereby transact stablecoin payments on behalf of customers who are increasingly demanding the speed, efficiency, interoperability, and low cost associated with these products,” Acting Comptroller of the Currency Brian Brooks said in a statement.

The move essentially puts blockchain networks on an equal level as global financial networks such as SWIFT, ACH and FedWire, the lobbyist group The Blockchain Association said in a tweet, calling it “a giant advance for crypto because it paves the way for these networks to be a formal part of the U.S. financial infrastructure.”

By Mike Murphy, Market Watch, 4 January 2021

Read more at Market Watch

Photo (cropped and edited): Forextime.com [CC BY 2.0] via Flickr

RiskScreen: Eliminating Financial Crime with Smart Technology

You can claim CPD minutes for this content, by signing up to our CPD Wallet