The Federal Reserve Board has released more details regarding its program to oversee new activities in the banks it regulates. These activities include complex collaborations with non-banks to offer banking services using technology and involvement with cryptocurrencies and blockchain technology.
The objective of this supervision program is to encourage the benefits of financial innovation while effectively addressing risks to ensure the safety and stability of the banking system. It will be integrated into the existing supervisory processes of the Federal Reserve, with experts in the program working together with current supervisory teams to monitor banks engaged in these new activities.
Additionally, the Board has also provided information on the procedures that state banks supervised by the Federal Reserve must follow before participating in certain types of digital currency or stablecoin activities. This includes the requirement of demonstrating appropriate safeguards to ensure the safety and stability of such activities to Federal Reserve supervisors.
These announcements are part of the ongoing efforts of the Federal Reserve to provide clarity as financial services and associated technologies continue to develop. They build upon the Board’s policy statement issued in January that clarified limitations on certain activities, promoting fairness among banks with federal supervision.
Read the original Federal Reserve release here.
