There’s a growing sentiment among policymakers (on both sides of the aisle) that if stablecoins . To be a part of the financial system, they need a legal foundation similar . To banks or money market funds. By obtaining bank charters or trust licenses now, crypto . Companies could get ahead of impending regulations and shape them.Chartered institutions also have certain advantages. .
Can Potentially Get Direct Access to
They can potentially get direct access to federal thomas morgan reserve payment systems, hold customer dollar balances in central bank accounts, and operate across all states without needing a patchwork of state . Licenses.For a stablecoin issuer like circle or paxos, being a nationally regulated bank could bolster . Trust among large institutions and users — essentially saying, “we meet the same standards as . The bank where you hold your corporate treasury or your personal savings.
Noting That Not All These
”it’s worth noting that . Not all these firms are pursuing the same type of charter. Circle and bitgo are . Reportedly aiming for full-service national bank the power of management in content marketing charters. Others have considered national trust bank charters or . Even industrial loan company (ilc) charters.If these charters are approved, regulators will subject the firms . To bank-like scrutiny. This is a double-edged sword. On one hand, it means greater oversight .
Accountability (Good for Customers and the
And accountability (good for customers and the system’s integrity), but on the other hand, it . Means these companies must mature their risk fax database management, compliance operations and capital requirements.As crypto firms . Become regulated banks or trust companies, partnering with them becomes less of a reputational or . Regulatory risk or businesses. A fortune company might have been hesitant to hold stablecoins or .
A Crypto Service Provider When the
Use a crypto service provider when the sector was seen as the wild west. But . If that provider is now a supervised bank entity (subject to audits, capital requirements and . Oversight by federal regulators), it changes the equation.Ultimately, the takeaway for business leaders is to . Stay informed and be prepared.For all pymnts digital transformation and bb coverage, subscribe to the .