The Clearing House Association L.L.C. (TCH) and the Bank Policy Institute (BPI) submitted comments in response to two consultative reports issued in October by the Financial Stability Board (FSB): Regulation, Supervision and Oversight of Crypto-Asset Activities and Markets and Review of the FSB High-Level Recommendations of the Regulation, Supervision and Oversight of Global Stablecoin Arrangements. TCH and BPI support the 19 recommendations outlined in the reports, which represent the FSB’s effort to balance responsible innovation with robust, comprehensive, clear, and consistent principles to address the risk that certain types of digital assets may present to consumers, businesses, investors, and financial stability. The two associations believe it is vital that meaningful regulatory and supervisory frameworks to address these risks be adopted around the globe.
TCH and BPI called for further strengthening the FSB's proposed frameworks in four principal ways:
- Establishing definitions that clearly distinguish the various types of digital assets, as the risks they present may differ, and differentiating between the assets themselves and the technology or infrastructure that underpin them;
- Explicitly clarifying that traditional banking products and activities utilizing distributed ledger technology, blockchain, or other newer technologies are beyond their scope;
- Ensuring that banks that are subject to comprehensive regulation, supervision, and examination are no less able to engage in digital-asset–related activities than nonbanks; and
- Ensuring the standards that apply to nonbank digital-asset service providers are equivalent to those that apply to regulated financial institutions engaged in functionally similar activities.
The two associations also called for the FSB’s proposed global stablecoin recommendations to apply to all stablecoin arrangements.
To read the full comment letter, click here.