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senators pressure crypto bank
Senators Elizabeth Warrren (D, MA), John Kennedy (R, LA) and Roger Marshall (R, KS) announced in a press release yesterday that they still aren’t happy with bank holding company and fiat/crypto rails provider Silvergate Capital Corporation after the company was sent a December letter filled with the Senators’ questions about the company’s involvement with crypto exchange FTX.
From the Senators’ release: “The bank’s response (see it) was largely evasive and refused to provide much of the requested information on the grounds that it was ‘confidential supervisory information.'” The Senators also sent another letter on Monday to Silvergate CEO Alan Lane saying, “Your response confirms the extent of this failure – but then neglects to provide key information needed by Congress to understand why and how these failures occurred.”
As outlined in a December press release, the bipartisan group of Senators original inquiry was fueled by “concerns about Silvergate’s failure to apply extensive review processes to FTX and Alameda, and the possible role the bank may have played in the loss of billions of dollars of customer funds.” Or put another way: how did a U.S. bank go about vetting a Bahamian crypto exchange?
innovation + stablecoin bill
Rep. French Hill (R, AR) said on Fox Business yesterday morning that the opportunity he sees for any blockchain-related legislation in the new Congress starts with nurturing innovation. The new Chair of the Digital Assets, Financial Technology and Inclusion Subcommittee said, “Stepping away from cryptocurrency or even a digital dollar, think about the innovation around fintech and blockchain in the future -we want that done here in the United States… we need a solid regulatory framework.”
A stablecoin bill appears to be a top priority as Rep. Hill said, “Last year, we had some work with both the Treasury and House Democrats moving towards a stablecoin bill. This would tell investors and consumers what’s the value -what backs the stablecoin. How do you know what the value is? How frequently is it valued? When are their financial statements published? How is it overseen for both consumer and investor safety as well as to be able to be used in the commercial marketplace? We just don’t have that.” But maybe soon. Hear more from the Fox Business interview [begins 2:20].
In an interview with Bloomberg TV yesterday afternoon, Rep. Hill shared additional nuggets on his agenda, “I think we need to look with our colleagues both in the Senate and House Agriculture Committees and make sure that we can develop a ‘brightline’ test of what should be traded in an Ag or commodity type environment versus something that’s a security and under the regulation of the SEC.” See the full Bloomberg interview [6:15 in length].
