President Joe Biden may have dashed any remaining hopes that Washington would welcome cryptocurrencies during his presidency.
Last week, the White House nominated Sula Omarova to lead the Office of the Comptroller of the Currency, a nomination that offers nothing but assurance that US financial regulators will not have cryptocurrency allies among them for at least the next three years.
The Cornell University law professor’s criticism of crypto-tokens is consistent with recent statements by government regulators, where Securities and Exchange Commission Chairman Gary Gensler previously said the market is “rife with fraud, fraud, and abuse,” said Michael Hsu, who was holding the position Acting Chief of the Office of the Comptroller of the Currency, Sept. 21, said virtual currencies could be just as dangerous as the complex derivatives that sparked the global financial crisis in 2008.
Although the outlook for cryptocurrency has changed significantly since the end of the Trump administration, the shift has been particularly sharp in the Office of the Currency Control, which regulates national banks including JPMorgan and Citigroup. Under the leadership of Brian Brooks, who resigned in January, the Office of the Currency Control has granted limited banking privileges to crypto firms, sparking fears among traditional Wall Street players that they may soon face a new slate of competitors. A former Federal Reserve official pulled out the welcome rug.
If the Senate approves Omarova’s nomination, the Office of the Currency Control will likely go further in seeking stricter oversight of crypto-tokens, which is in line with the trend in Washington, where Gensler wants cryptocurrencies to be regulated. Like stock.