The only way to defeat martial arts is to be fast. The US OCC Comptroller General hopes to establish a crypto regulatory framework as soon as possible

Michael Hsu, who was appointed as the Comptroller of the U.S. Office of the Comptroller of the Currency (OCC) by U.S. Treasury Janet Yellen this month, told the Financial Times that he hopes U.S. officials can work together to set a "regulatory boundary" for cryptocurrencies. U.S. financial authorities are preparing to create a regulatory framework for the $15 trillion cryptocurrency market as more investors worry about losses due to a lack of proper regulation.

U.S. regulators have recently made some efforts to regulate the crypto market and lay the foundation for a framework of rights and responsibilities, although these efforts may take time to mature.

“We still need a collaborative effort across institutions, and when I talk to some of my colleagues, they are actually very interested in this,” Hsu said.

The cryptocurrency market has been on a roller coaster this year. In February, after Tesla founder Elon Musk tweeted that he had bought $1.5 billion worth of Bitcoin, the price of Bitcoin soared and reached an all-time high of more than $60,000 in April. But recently, after Chinese regulators signaled a crackdown on digital currencies, prices began to plummet again. At the same time, Musk closed the channel for buying Tesla cars with Bitcoin on the grounds of environmental issues, and the price of Bitcoin was once again overshadowed. The entire crypto market has been linked to this, and its market value has shrunk significantly. In its heyday, Bitcoin, which once surpassed Tencent and exceeded $1 trillion in market value, has now shrunk to $644.7 billion, slightly higher than Tesla's market value.

This month, U.S. regulators held their first "sprint" regulatory group meeting on cryptocurrencies, attended by senior officials from the three main federal banking regulators, the Office of the Comptroller of the Currency currently managed by Michael Hsu, the Federal Reserve, and the Federal Deposit Insurance Corporation.

Hsu said the team’s goal is not to create policy but to “put some ideas and possibilities in front of regulators for consideration” as the crypto market grows wild.

Hsu explains the small size of the organization: "The current organizational structure is biased towards small-scale, senior experts because time is of the essence in the current situation. If the organizational structure is large, we may not be able to achieve the expected goals at all."

The Securities and Exchange Commission and the Commodity Futures Trading Commission have also discussed how to protect investors in the cryptocurrency market.

Gary Gensler, chairman of the U.S. Securities and Exchange Commission, told a conference last week that there is a “gap between our current regulatory system and how the broader market is evolving,” noting that legislation may be needed to dictate which regulator should oversee cryptocurrency exchanges.

Gensler said his goal is to bring "the same level of protection to investors in cryptocurrency exchanges that is similar to trading on the New York Stock Exchange or Nasdaq." He also said that the Treasury Department has been focusing on "anti-money laundering and prevention of illicit activity" in the cryptocurrency market. Treasury Secretary Janet Yellen has also said she is concerned that Bitcoin is "often used for illicit financial activities."

Through the appointment of Michael Hsu, we can also see the change in Yellen's attitude towards cryptocurrencies. In his own words, "My mission is to be a professional civil servant and a bank supervisor." Brian Brooks, the former Comptroller of the Currency during the Trump era, has already joined the cryptocurrency industry and is currently the CEO of Binance.US.

As one of Hsu’s first actions at the Office of the Comptroller of the Currency, he asked staff to review a Trump-era decision to grant state trust charters to companies that provide custody services for cryptocurrencies.

While Hsu sees innovations like blockchain technology used in cryptocurrencies as an inevitable trend in the development of history, he also publicly stated that the current enthusiasm for the banking industry reminds him of the years before the financial crisis.

The real danger, he argues, is that new and improved technologies give rise to "a vast, less regulated shadow banking system." Today, innovations from fintech companies and technology platforms "bring great promise to society, but also great risks."

He concluded, "It's hard for me to deny these feelings of déjà vu.