The US Federal Reserve (OCC) announced on Monday that banks under the Federal Banking Regulator can now use stable coins in their payments and other activities.
To Report CoinDesk, the US Federal Reserve, has issued an interpretative statement outlining the possibility for national banks and federal savings funds to participate in independent node verification networks, or INVNs, and stable coins. The statement said that financial institutions can participate as nodes in China’s blockchain networks and store or approve payments. Each device that connects to a blockchain network is called a node.
Also read: What are Ninety and Full Ninety?
A statement from the US Federal Reserve said that any bank participating in INVNs should be aware of operational risks, compliance problems or network fraud.
The US COD has said that independent NOD verification networks can be more resistant to tampering than other payment networks because they require large nodes to authenticate transactions, which can reduce the likelihood of tampering.
Kristin Smith, executive director of the Blockchain Association, wrote on her Twitter page:
The Blockchainchain has similar conditions to other global financial networks, such as Swift, ACH and FedWire, the statement said.
SWIFT is a non-profit cooperative association for interbank financial communications, an automated clearing house, an electronic clearing mechanism used in the financial transactions of US banks and institutions, and a federally funded instant cash transfer system. Is.
“US Currency Control Chief of Staff Brian Brooks said in a statement:
While other countries have launched their own instant payment systems, the United States is dependent on the private sector to implement such technology.
Brooks’ remarks seem to confirm the use of digital currencies, and in particular stable coins, as an alternative to other instant payment systems.
Brooks has overseen the release of two other statements and actions related to digital currencies since his appointment as Chief of Staff of the US Currency Control; Including a statement that allows federal banks to provide services to issuers of stable coins and save their financial resources.
Brooks also announced last month his support for a statement from the president’s working group on financial markets that included a policy to regulate stable coins in the United States.
President Donald Trump has twice nominated Brooks for a full five-year term, one of which dates back to earlier this week. However, it is unclear whether the US Senate will approve Brooks for the post. The Senate decision on Brooks’ choice appears to be determined before Joe Biden takes office.
The statement from the US Currency Control Headquarters was released on the same day that the deadline for public comment on the proposed Financial Crimes Enforcement Network (FinCEN) law expired. The controversial law had only a 15-day public comment period. It is also reported that US Treasury Secretary Steven Mnuchin, who appointed Brooks as a member of the US Currency Control Board in early 2020, has been pushing for the law.
“Smith,” she said.
A statement from the US Federal Reserve on Monday shows that there has been no strong opposition to digital currencies and that there are clear points in the government body that digital currency networks have been accepted as the basis for the future of payment systems and other financial services. We therefore welcome such statements.