The Real Terms of Crypto Market Regulations
OpinionBit News Today2 min read
On July, the top officials from the Office of the Controller of the Currency (OCC), Federal Reserve, Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Administration (NCUA), sent a coordinated letter to the heads of the largest banks. They detailed the severe restrictions on crypto for banks: No crypto trading. No crypto staking. No services for crypto miners, no crypto lending, no investment in crypto projects, no involvement in crypto "service corporations," whatever that meant. ## What It Means
Most significantly, the letter spelled out exactly how much authority the agencies think they have to issue sweeping new restrictions. In short: Almost all of it. They aren't waiting for clearer authority from Congress or the President.
Most importantly, the agencies say they have the authority to issue far more restrictions than they did. The agencies explicitly name-check several crypto projects they have identified as "highest risk" but won't reveal to the public:
The letter says that if a bank was to involve itself with crypto, the agency "would expect the bank to raise an issue for potential supervisory action," and that most crypto projects are "highly likely to fall within the authority" of the concerned agencies.
They've even developed a coordinated plan for responding to a bank's attempts to raise a legal challenge. They don't name it anything in the letter, but in a similar letter sent by the OCC nearly a month earlier, they called such a plan a "resistant strategy."
As for why the agencies think they have all this authority, that's explained in the second half of the letter. It carefully argues that the definitions in their separate original founding laws apply to crypto in a way that gives the agencies forced oversight powers. ## What It Means For You
The threat to crypto has never been clearer. While the agencies are currently only setting loose restrictions, they've made it clear they think they have much more authority to make actual rules and impose restrictions, far beyond anything crypto has seen before.
While the agencies haven't made good on their threat so far, they've made it clear they will always be lurking in the background, ready to crack down. They are performing a calculated, strategic campaign to gradually force compliance, while watching how crypto reacts, and picking off the most vulnerable.
Again, the agencies have made it clear they don't want to be seen as a threat to innovation. Don't believe it. These are the real terms of crypto regulations. This will not go away. This is how the agencies think they have the authority to regulate. This is what crypto is up against to survive and grow in the US.
This is the current state of crypto regulations, and the implications are dire, as the agencies have made clear. As it stands, the agencies believe they have the authority to regulate crypto in any way they see fit with no legislative authorisation.
