Navigating Stablecoin Regulations

Brian Brooks got his start in traditional finance before joining Coinbase in 2018 and is currently the acting comptroller of the currency. In this episode, he discusses:

• how his background in traditional financial services led him to take a position at Coinbase
• whether the role blockchain and crypto will likely play in the financial future is being recognized at the federal level
• whether or not banks have always had the authority to custody crypto for their customers
• how he expects things to unfold in the coming years as banks begin to become more involved in crypto custody
• his thoughts on Kraken and others launching crypto banks and whether it will lead to the founding of other crypto banks
• how his office is pushing for a national fintech charter, and how it could affect less crypto-friendly states
• whether banks that work with crypto companies supporting unhosted wallets are prohibited from holding stablecoin reserves
• whether or not OCC regulations cover DeFi, and the regulatory challenges that open source protocols present
• whether he sees a time when governments and regulators participate in the governance of crypto platforms
• what roles he thinks public and private sectors, as well as commercial banks, should play in the creation of a central bank digital currency
• what stance the OCC might take around privacy in blockchain transactions
• how U.S. regulators can offer more clarity to the crypto industry
• and how he thinks the pandemic, its effect on the economy, and the government’s response through stimulus will affect the crypto industry

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Crypto.com: https://www.crypto.com

Episode links: 

Brian Brooks: https://twitter.com/BrianBrooksOCC

Office of the Comptroller of the Currency: https://www.occ.gov

Letter to authorize banks to provide crypto custody services for customers: https://www.occ.gov/topics/charters-and-licensing/interpretations-and-actions/2020/int1170.pdf

The significance of the letter for banks and crypto companies: https://www.forbes.com/sites/matthougan/2020/07/27/the-occs-notice-on-crypto-is-a-really-big-deal/#13aad8806301

The OCC’s statement on federally chartered banks and crypto custody: https://www.occ.gov/news-issuances/news-releases/2020/nr-occ-2020-98.html

His support for a federal licensing framework for crypto companies: https://www.coindesk.com/us-banking-regulator-suggests-federal-licensing-framework-for-crypto-firms

Questions about the OCC’s stablecoin guidance

https://www.coindesk.com/questions-occ-first-guidance-stablecoins

CSBS “One Company, One Exam” policy: https://www.coindesk.com/csbs-firms-explained

Battle with states over federal licensing program: https://www.politico.com/news/2020/08/31/currency-comptroller-reshape-banking-406393 

FinCEN’s 2019 Regulatory Guidance: https://www.fincen.gov/news/news-releases/new-fincen-guidance-affirms-its-longstanding-regulatory-framework-virtual

Federal Reserve says it is exploring a central bank digital currency: https://www.coindesk.com/fed-reserve-evaluating-digital-dollar-but-benefits-still-unclear-says-chairman 

His view that a CBDC should be designed by the private sector: 

https://www.theblockcrypto.com/post/69216/heres-how-brian-brooks-disagrees-with-fed-chair-jerome-powell-on-the-digital-dollar

The OCC’s Financial Inclusion Project: https://www.occ.gov/topics/consumers-and-communities/minority-outreach/project-reach.html

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