WASHINGTON— In a letter sent to federal regulators that include NCUA, concerns over a recent bulletin from the Securities and Exchange Commission that tells cryptocurrency platforms they should consider their customers’ digital assets when performing risk analyses are being raised by House Financial Services Committee Chairman Patrick McHenry (R-NC) and Sen. Cynthia Lummis (R-WY).
The letter was sent to NCUA Chairman Todd Harper, Federal Reserve Vice Chair Michael Barr, FDIC Chair Marty Gruenberg, and Acting Comptroller of the Currency Michael Hsu. McHenry and Lummis outlined how they believe the SEC Staff Accounting Bulletin (SAB) 121 could apply to and potentially restrict regulated financial institutions, NAFCU reported.
‘Massive Capital Charge’
“Since SAB 121 purports to require banks, credit unions and other financial institutions to effectively place digital assets on their balance sheets, it would trigger a massive capital charge. This in turn is likely to prevent these prudentially regulated entities from engaging in digital asset custody,” McHenry and Lummis wrote. “To the contrary, we should be encouraging prudentially regulated financial institutions, like banks and credit unions, to provide digital asset services precisely because they are subject to the highest standards of capital, liquidity, recovery and resolution, custody, cyber-security, and risk management.”
As CUToday.info reported earlier, McHenry has created the first congressional subcommitteeto deal with cryptocurrency. Additionally, McHenry and Lummis are working on legislation to regulate digital assets, NAFCU noted.
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