The Fed studies creating a team of cryptocurrency experts to supervise the sector

The Federal Reserve (Fed) of the USA would be studying the creation of a “team of experts” to follow the evolution and supervise the sector of the cryptocurrencies after the fall of Silvergate.

According to Michael Barrvice president of supervision of the US central bank, cryptocurrencies could have a “transformative effect” on the US financial system, although he warned that “the benefits of innovation can only be realized if the right guardrails are established”.

The Fed advances in controls to the sector of the criptomonedas

“Innovation always comes fast, but it takes time for consumers to realize that they could both make and lose money with new financial products,” he said in a speech at the Peterson Institute for International Economics in Washington.

Barr noted that the new team tasked with overseeing cryptocurrencies will help the Federal Reserve to “learn from new developments and make sure we are up to date on innovation in this sector.” In recent months, the Fed has been issuing guidelines and policy statements on digital assets in the United States alongside other regulators such as the Office of the Comptroller of the Currency (OCC).

“While crypto assets are promoted as decentralized, there has been an emergence of new, fairly centralized intermediaries that are not subject to or do not comply with appropriate regulation and supervision, which has perpetuated the harm to consumers,” pointed.

Likewise, the vice president of the Fed stressed that regulation in the sector must be a “deliberative process” that makes it possible to guarantee that a balance is reached between the excess of regulation that “will stifle innovation” and the lack of it that “will cause a substantial damage to households and the financial system.”

In addition, Barr noted that the Fed tends to give small banks more leeway than large ones if it detects cryptocurrency concentration issues before they issue public warnings. It should be noted that recently The parent of crypto bank Silvergate has decided to voluntarily liquidate the company.

In this regard, the member of the Fed indicated that “nOur general position is that, at this stage of development, banks should take a careful and cautious approach when engaging in activities related to crypto assets and in the cryptocurrency sector.”

“We tend to have a very soft approach with smaller institutions, so there is a bigger push for them to pay attention to these new and novel risks, and we have to make sure they understand that,” he explained.

Separately, Barr spoke about stablecoins, which have been subject to intense scrutiny by the SEC of late. According to the Fed official, the large-scale adoption of these tokens, which he described as “unregulated private money subject to classical forms of execution risk”, could threaten the financial system in general.