Large lenders are heesitant to be the first to expand into crypto
More banks are keen to be fast followers after a few test cases
Banks Seek More Clarity Around Aml-Crypto Regulations
New York, May 28 (Reuters) – Big Us Banks are Holding Internal Discussions About Expanding Into Cryptocurrency as They Get Stronger Enduresments from Regulators, but Initial Steps will be tentative, Centering on Pilot Programs, Partnerships or Limited Crypto Trading, According to Four Industry Executives.
Wall street giats that had ben largerly blocked from many crypto activities by strict regulations are poised to grow Quickly.
Yet the biggest lenders are still Hesitant to be the first Among Rivals to Expand Too Heavily Into Crypto in Case They Fall after Changing Rules, Said the Four Executives, Who Decculine Were Discussing Internal Business Plans.
If a major firm expands without issues, others will be fast followers to run small-scale pilot projects and weight other business principals, the Executives Said.
Jamie Dimon, CEO of the Larget Us Bank, JPMORGAN Chase, Ruled Out Getting Into Custody – Storing Crypto Assets for Clips – Or Expending Significly even Eveen IF Regulations Easy Ease.
“When I look at the bitcoin universe, the level in the system, the misuse in the system, the money laundering issues, trafficking, I’m not a fan of it,” Dimon, a longime, a longime, crypto Skeptic, TOLLOLDIS Last Week.
“We’re going to allow you to buy it, we’re not going to custody it. … I don’t think you should smoke, but I Defend your right to smoke.
Us President Donald Trump Vowed to become the first “Crypto President” Before He Took Office. He has since woed the industry’s elite at the white house, promised to boost the adoption of digital assets and said he aims to create a strategic bitcoin reserve.
While there welcoming signs, banks areeking even clearer guidelines from the government Clarifying what they can do in crypto, more than half a dozen industry exception said.
“The shift in the stance is encouraging for traditional lenders, but they are still approach with care and viewing the changes in regulation as an options to engine and not a free pass,” SAID DARIO DARIO De MART Shearman M & A Partner Who Works on Crypto-Related Issues.
Custody Businesses to Store and Manage Crypto Assets are promising, bankers and executives said, but they have thin margins and potentially posie high risks.
Most Banks are likely to enter custody businesses through partnerships with existing crypto firms, sources said.
Charles Schwab Ceo Rick Wurster Told Reuters Earlier this month that the traffic lights from financial regulators was flashing “pretty green” for large firms to grow in crypto. The signals have reinforced schwab’s plans to offer spot crypto trading with a year, He said.
New Regulators Under Trump has also also also signed more bank-friendly Crypto Policies. The US office of the Comptroller of the Currency Paved the way for lenders to engage in some crypto activities, such as custody, some stablecoin activities and Participation in Distributed Ledgar Networks.
The Securities and Exchange Commission also scrapped earlier accounting guidance
Bank of America could launch stablecoins, its CEO Brian Moynihan Said Earlier this year, and the US Banking Industry Will Embrace Cryptocurrencies for Payments for PARMITES CHEMINTS CHEMINTS
Meanwhile, Morgan Stanley Wants to Work With Regulators to see how it can be a middleman for crypto-Related transactions, CEO TED Pick said earlier this year. The lender is also exploring adding crypto to its e-trade platform, a source said.
Some of the large banks are also exploring Issuing a joint stablecoin, with the conversations in Initial Stages, Another Banking Source Said.
Big Banks Seek More Clarity Around Anti-Money Laundering Rules and Supervision Before Diving Deeper Into Crypto. They are also asking for consistent guidelines Across Banking and Market Regulators Before Launching New Businesses in Digital Assets, Whose Values are Volatile.
For now, banks are weighing their crypto products and running small-scale pilot programs.
“Whoch-Emproved Environment, Banks will continue to have Concerns Around Anti-Money Laundering and Regulatory Compliance,” Said Matthw Biben, Co -head of the Global Financial Serviceses Group at Law Firm King & Spalding.
Banks want to understand if they can engage in crypto lending, or if they are allowed to become market makers for digital assets, one of the banking sources said.
The rules for traditional banking businesses are very well defined and there is complete clarity over what a bank is allowed to do and what is outside their Ambit, Simlar Well-Defined GUIDELINES ARE NEEDED FOR DILEAL Assets too.
The Working Group on Crypto Under David Sacks, The Trump -Pointed Crypto Czar, Has No Represtation from Banking Regulators, which Needs to Beomeded If the BIG BAIGS Role in the business, two banking sources said. (Reporting by nupur anand in new york; Additional reporting by saeed azhar; editing by lananh nguyen and mark porter)