#cryptocurrency – Page 5 – Federal Financial Analytics

8 03, 2023

DAILY030823

Eliza Allen2023-03-08T17:06:14-05:00March 8th, 2023|2- Daily Briefing|

HFSC Plans Broad Attack, Limited Legislation to Rewrite Administration Crypto Standards

The HFSC staff memo makes it clear that the Digital Asset Subcommittee hearing on Thursday will be a strong general GOP attack on Biden Administration crypto policy and specific campaign against the SEC’s enforcement-focused strategy.

HFSC Plans to Blast CFPB, Press Limited Change

Thursday’s HFSC Monetary Policy Subcommittee hearing on the CFPB is sure to be a raucous, partisan affair judging by the staff memo describing it. Republicans have strongly objected to the Bureau before its inception, with concerns sharply heightened by a series of recent actions under Director Chopra.

CFPB Slams Fees, Promises Mercy

Ahead of a meeting later today between senior White House officials, Director Chopra, and hundreds of state legislators concerning the President’s “junk fee” agenda, the CFPB today released Supervisory Highlights focusing on recent instances of what it deems unlawful junk fees in deposit accounts, auto loan servicing, mortgage servicing, payday lending, and student loan servicing.

GAO Doubts Fintech’s Inclusion Advantage

The GAO today released a report finding that fintech may enhance inclusion, but that this inclusion comes at risk due to the patchwork of rules governing firms offering products – e.g., wage advances – that may put vulnerable households at risk.

HFSC Republicans Scrutinize SEC Rulemaking, Fed Climate Policy

As anticipated, today’s HFSC Subcommittee Hearing with the inspectors-general for the FRB, CFPB, Treasury, and SEC focused on GOP attacks on the SEC’s IG vacancy and the CFPB’s funding mechanism.

Brown, Others Demand ABA …

15 02, 2023

DAILY021523

Eliza Allen2023-02-15T17:02:30-05:00February 15th, 2023|2- Daily Briefing|

GOP Launches Anti-SEC Climate-Risk Legislative Attack

As anticipated, House Republicans have gone beyond blasting the SEC’s pending climate-risk disclosure proposal to laying out a consensus bill to force Chairman Gensler in fact to retract it. H.R. 1018 has been introduced by HFSC member Lucas (R-OK) and 55 Republicans to prohibit climate-risk disclosures under securities law.

FDIC Adds Punch to FDIC-Misrepresentation Enforcement Promise

Building on its insurance misrepresentation final rule (see FSM Report DEPOSITINSURANCE113), the FDIC today issued four cease and desist orders demanding the removal of false claims and thus made it clear that it is surveying the marketplace to take far more rapid action than has been the case thus far.

Calling Out Hsu, Warren Demands Merger Reform

In a wide-ranging speech urging tough U.S. antitrust policy, Sen. Warren (D-MA) today reiterated her claims that banking agencies “rubber-stamp” mergers and pressed for immediate reform. She took particular aim at Acting Comptroller Hsu, urging him to prepare new guidelines for the banking industry and to block anticompetitive mergers.

Will SEC Custody Rules Kill Crypto?

Conceding that rulemaking is needed on at least one crypto question, the SEC today voted 4-1 to approve proposed changes to investment-advisor asset custody regulation. The measure would expand assets subject to custody requirements and the protections custody affords as well as revise related record-keeping requirements.

Daily021523.pdf…

14 02, 2023

DAILY021423

Eliza Allen2023-02-14T16:52:49-05:00February 14th, 2023|2- Daily Briefing|

What’s Next At The Post-Brainard Fed

Clients have asked us to advise on what may be next for the Fed if Vice Chair Brainard is indeed named as head of the White House NEC, which now seems certain. In our view, there will be no change to FOMC policy given unanimity on this question and the leadership not only of the vice chair, but also of the Fed chairman and FRB-NY president. However, there could be a significant shift in the likelihood of a U.S. CBDC. Ms. Brainard has been the most outspoken advocate of a CBDC (see Client Report CBDC13), but her successor as head of the Fed payment committee is likely to be either Gov. Waller or Bowman, each of whom is a strong CBDC skeptic.

Daily021423.pdf…

3 02, 2023

DAILY020323

Eliza Allen2023-02-03T16:59:55-05:00February 3rd, 2023|2- Daily Briefing|

House GOP Bill Sanctions Digital Yuan

Ahead of a major HFSC anti-China push next week, Chairman of the Subcommittee on National Security, Illicit Finance, and International Financial Institutions Luetkemeyer (R-MO) today introduced H.R. 804 to bar money servicing businesses from engaging in any transaction involving Chinese CBDC.

HFSC Plans Wide-Ranging China Attack

Emphasizing the priority Republicans have placed on U.S.-China policy, HFSC’s staff memo for Tuesday’s full committee hearing details numerous initiatives the panel may advance to isolate China and the Communist Party from the U.S. and global financial system.

HFSC Anti-Woke Group Targets SEC, Proxy Voting

Following his promise to go after “woke” policies during the HFSC organizational meeting, Chairman McHenry (R-NC) today announced the formation of a Republican ESG working group. It has no legislative jurisdiction and will instead combat the “far-left” influence over capital markets by addressing SEC regulatory “overreach,” reinforcing the materiality standard for disclosures, and preventing the misuse of the proxy process.

Daily020323.pdf…

31 01, 2023

DAILY013123

Eliza Allen2023-01-31T16:58:29-05:00January 31st, 2023|2- Daily Briefing|

BIS Finds Digital Payments Have Yet to Conquer Cash

In a brief today, the BIS Committee on Payments and Market Infrastructures (CPMI) found that digital payments, while rapidly growing, have not supplanted cash. CPMI does report a record high value and volume of cashless payments, crediting this to changing consumer preferences, increasing prevalence of fast payments systems, and COVID, noting that cashless options may also bolster financial inclusion. However, the brief also finds a deceleration in the decline of cash withdrawals, concluding there is still a significant ongoing, if diminishing, demand for cash.

Warren, GOP Allies Grill Silvergate on FHLB Loan, Fed Supervision

Signaling bipartisan plans to take on crypto banking and now also the FHLBs as quickly as possible in the new Congress, senator Warren (D-MA) was joined yesterday by Sens. Kennedy (R-LA) and Marshall (R-KS) in sending another letter to the CEO of Silvergate Bank. Following an earlier inquiry which they said led to an insufficient response, the letter now focuses on the bank’s use of a $4.3 billion FHLB loan as a liquidity backstop. As in Karen Petrou’s recent memos and today’s podcast, the letter focuses on the System’s prior lien ahead of all other creditors (including the FDIC) and the extent to which this puts taxpayers at risk.

Daily013123.pdf…

13 01, 2023

AL011623

Eliza Allen2023-01-13T16:42:19-05:00January 13th, 2023|3- This Week|

Tumult in the House

As is patently clear from all the discourse following Kevin McCarthy’s fifteenth ballot win for the House gavel, the “lower body” has taken a few shots across its institutional knee-cap. However, we think experienced House Members with ambitions for higher office along with affinity for strongly-conservative policies will find a way to move legislation on the GOP side of the aisle. Less clear is what Democrats will do given the Speaker’s pledge to bring every bill to the floor on an open rule – a procedure allowing them considerable scope both for substantive legislative change and political theater. If the Minority Leader, Hakeem Jeffries (D-NY) thinks his party’s bread is buttered on the side of showing it can govern, some bills will move forward without toxic Democratic change; if not, not. All is, thus, a muddle in which there may well be a middle.

Al011623.pdf…

10 01, 2023

American Banker, Tuesday, January 10, 2023

Arezou Rafikian2023-01-11T11:01:42-05:00January 10th, 2023|Press Clips|

Silvergate Bank loaded up on $4.3 billion in FHLB advances

By Kate Berry

When depositors began pulling money out of Silvergate Capital Corp. following the collapse of cryptocurrency exchange FTX, the California bank shored up its liquidity by tapping a quasi-government agency not typically known as a lender of last resort. Silvergate received $4.3 billion from the Federal Home Loan Bank of San Francisco late last year, company filings show….”What the $4.3 billion to Silvergate went to in terms of mission is a very intriguing question,” said Karen Petrou, managing partner at Federal Financial Analytics. “The housing mission of the Home Loan banks is apparently long gone, since this has nothing to do with housing. It has to do with supplementing wholesale funding sources for banks that can’t happen any other way or at greater cost.”

https://www.americanbanker.com/news/silvergate-bank-loaded-up-on-4-3-billion-in-fhlb-advances

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22 12, 2022

DAILY122222

Eliza Allen2022-12-22T16:43:24-05:00December 22nd, 2022|2- Daily Briefing|

Waters Blasts ICE/BKI Merger

Although HFSC Chair Waters (D-CA) frequently opposes large-bank mergers, her stand today against the ICE/Black Knight deal is the first time we can recall her taking a public stand on a transaction before the Federal Trade Commission (outside HFSC’s jurisdiction).

Toomey Sets Agenda for GOP Fed Reform

Among his parting shots, Senate Banking Ranking Member Toomey (R-PA) yesterday introduced legislation to reform the Federal Reserve System.

Toomey Also Tries to Set Stablecoin Agenda

In another effort to set the terms of debate before he departs, Senate Banking Ranking Member Toomey (R-PA) also introduced a new version of his initial stablecoin legislation (see FSM Report CRYPTO27).

Warren Doubts Zelle’s Fraud Policy Changes

Continuing her campaign against Zelle fraud, Sen. Warren (D-MA) today sent a letter to the CEO of Zelle’s parent company demanding a briefing on pending efforts to compensate consumers for fraudulent transfers.

CFPB Cites ARM Risks, Rewards

The CFPB today issued a consumer alert describing the risks associated with various mortgage products during a period of rising interest rates.

Project Hamilton Ducks CBDC-Feasibility Decision

The Federal Reserve Bank of Boston today announced the completion of its Project Hamilton work with MIT on a U.S. CBDC.

Fed to Reconsider Key Bank-Control Criteria

Although the banking agencies today reiterated that their policy is not generally to require reporting of loans to potentially controlling principal-fund complexes or banks that meet passivity requirements, the Fed will now reconsider relevant rules in this sector.

Daily122222.pdf…

21 12, 2022

DAILY122122

Eliza Allen2022-12-21T16:53:18-05:00December 21st, 2022|2- Daily Briefing|

FRBNY Blog: DeFi Addresses Crypto Risks, Tech, Legal Concerns Remain

Addressing the extent to which some of crypto could survive the current calamity, FRB NY staff in a blog post today argue that DeFi could resolve some of the risks apparent in recent crypto collapses if – and only if – technological and legal risks are addressed. Features inherent to DeFi – e.g., self-custody, automated governance controls, and transparent distributed ledgers – address the asset custody, governance, and disclosure failures central to recent collapses.

Daily122122.pdf…

16 12, 2022

Al121922

Eliza Allen2022-12-16T17:21:25-05:00December 16th, 2022|3- This Week|

Crypto Gets Lumps of Coal From Congress

As we detailed last week, the House Financial Services Committee and Senate Banking tackled not just FTX’s meteoric plunge, but also policies to respond to it and broad problems across the cryptosphere (see Client Report CRYPTO36). Although nothing substantive will happen regarding new digital-finance law in what’s left of this Congress, these hearings lay a strong platform on which new debate on digital-finance reform will proceed early in 2023. Whether there will be new law remains an open question – as we noted, Senate Banking Chairman Brown (D-OH) one day said he wants to craft some and then the next returned to calling on Secretary Yellen to write a raft of new regulations. Still, we think that there will be new law – and not just to ensure AML compliance along the lines included in the Warren-Marshall bill – because we expect HFSC under incoming Chairman McHenry (R-NC) to advance one that, at least for now, might well pass the bitterly-divided House. To be sure, Democrats will balk at anything that hamstrings the SEC, but there is growing agreement on how best to redefine digital finance so it is the innovation Republicans espouse without posing the risks Democrats decry.

Al121922.pdf…