U.S. Banking Regulation Charts Path for Blockchain Startup Regulation

Rage Review : Currently, as financial technology is increasingly integrated into traditional banking functions such as consumer lending, payment, wealth management and settlement, the Office of the Comptroller of the Currency (OCC), the US banking regulator, has issued a policy outline aimed at regulating blockchain and other financial technology-related start-ups. And since the beginning of this year, the OCC is studying the creation of a specific federal charter for financial lucratives, although this process is still ongoing.

Translation: Nicole

A U.S. banking regulator has unveiled a broad innovation policy aimed at regulating startups working with blockchain and other fintech efforts.

On Oct. 26, the Office of the Comptroller of the Currency (OCC) released its “Responsible Innovation Framework,” a policy outline the agency has been working on since the beginning of the year. In March, the OCC released a white paper outlining its goals.

The agency will establish an “Office of Innovation” headquartered in Washington, D.C., which will lead fintech-related policy development and outreach.

The head of the office will be named the OCC’s chief innovation officer and will report directly to Comptroller Thomas Curry. The OCC said it will also expand internal training programs to educate employees on technologies like blockchain.

The agency sought to highlight the rapidly evolving financial landscape, stating in the report:

“Today, FinTechs are integrated into traditional banking functions such as consumer lending, payments, wealth management and settlement. FinTechs are also leveraging new technologies and processes, including cloud computing, application programming interfaces, distributed ledgers, artificial intelligence and big data analytics.”

The OCC has sought to be a positive voice in the changing regulatory landscape for technology in the U.S., calling last year for a “balance of measures” to regulate bitcoin. At the same time, the OCC included the technology in a risk assessment for banks that it launched in July.

However, the publication of the framework is only the beginning of a much more important and controversial process.

Earlier this year, the OCC began studying whether to create a specific federal charter for fintech. As of this week, that process was still ongoing.

The agency said:

“The OCC does not have discretion over the granting of special purpose national bank charters to nonbank financial technology companies, nor does it have discretion over the conditions under which such companies may proceed with their evaluation.”