“Trump’s team is going to bring digital finance to life.”, — write: www.unian.ua
Trump’s team is going to bring digital finance to life.
Traditional finance and the crypto industry do not agree on everything / screenshotUS President Donald Trump has promised that digital assets will play a crucial role in the country’s innovation, economic development and international leadership. Some experts fear that the decisions of the new American leader will lead to disaster.The Economist writes that the Biden administration made every effort to prevent the crypto industry from entering Wall Street. Strict rules made it prohibitively expensive for banks to hold digital assets on behalf of customers and prevented them from creating their own crypto products, such as stablecoins – tokens tied to the dollar or other assets. Now everything can change.
On January 21, Travis Gill, the FDIC’s interim chairman, said he wants to see more transparency in the regulation of cryptocurrencies and that all law-abiding customers should be able to access bank accounts. The cryptocurrency industry has not had this opportunity for a long time due to concerns about money laundering.
On January 23rd, the Securities and Exchange Commission changed its guidance so that financial institutions no longer have to count crypto assets held on behalf of clients on their balance sheets.
These changes will affect almost all institutions on Wall Street. Brian Moynihan, chief executive of Bank of America, said that banks will accept cryptocurrencies such as stablecoins that can facilitate transactions. Many of them are experimenting with crypto tokens that transfer ownership of shares in money market funds. They also intend to develop trading and storage of cryptoassets when all the nuances of the new regulatory regime are known. In this regard, it is expected that some institutions may acquire cryptocurrency companies.
Dylan Walsh from the consulting company Oliver Wyman believes that the reverse situation may also happen – cryptocurrency companies will buy institutions with banking licenses that allow them to accept deposits and issue loans.
However, traditional finance and the crypto industry do not agree on everything. The biggest point of contention concerns the payment “rails” of the Federal Reserve System. About 9,000 companies have master accounts with the central bank, which allow payments to be made without intermediaries, which reduces the cost and complexity of transactions. Some crypto companies have already applied to open master accounts, but they have either been rejected or their documents are still pending.
Traditional banks are satisfied with this state of affairs. The Banking Policy Institute and the American Bankers Association have supported the Fed’s right to block access to master accounts. They emphasized the need to protect against credit risk, cyber security risk and reputational risk, especially related to money laundering and terrorist financing.
There are also concerns about the volatility of cryptocurrencies. Stephen Kelly of Yale University says he worries about the implications of “the connection between what’s happening in cryptocurrency prices and what’s happening with banks.” If fluctuations in the cryptocurrency market affect bank deposits, institutions will become more vulnerable. According to him, this is exactly what happened to Silvergate and Signature, two cryptocurrency banks that collapsed in 2023.
Trump and the cryptocurrency world – the latest newsNewly elected US President Donald Trump announced the launch of the $TRUMP memcoin. 200 million coins were released on the first day.
In a few days, the future first lady of the USA, Melania Trump, also announced the launch of her own cryptocurrency – memcoin $MELANIA.
On January 20, Bitcoin reached an all-time high of $109,241 amid preparations for Trump’s inauguration, but the cryptocurrency market has seen changes since the ceremony. In particular, Bitcoin, as well as memecoins of the Republican and his wife, fell in price.
You may also be interested in news:
- Will Bitcoin hit $200k in 2025: FT prediction
- “Bad for the Industry”: Donald and Melania Trump Launch Competing Tokens
- The dollar is “stuck” due to the uncertainty of Trump’s plans