Bitcoin

OCC’s Otting Hedges On FinTech Charter

Despite the current bitcoin boom, the nation’s new Comptroller of the Currency doesn’t believe the cryptocurrency poses a threat to the country’s banking system.

According to news from Reuters, the marketplace is watching to see how Joseph Otting, who was sworn in last month, will address issues including virtual currencies, FinTech and the Trump Administration’s pledge to roll back rules introduced following the 2008 financial crisis.

In his first formal press briefing, Otting didn’t seem too worried about bitcoin.

“Mostly the banks have stayed away from the currency … it doesn’t seem to have come into the banking system,” he said, adding that the Office of the Comptroller of the Currency (OCC) feels the currency does not currently pose a threat to the safety and soundness of the banking system.

“But everybody’s watching it very closely,” he assured reporters.

Otting spent more than 30 years as a banker at U.S. Bank and Union Bank and was most recently chief executive officer of OneWest, the California lender started by Secretary of the Treasury, Steven Mnuchin. Otting is the first former banker to lead the OCC in decades.

During the briefing, Otting also said he saw a future for a charter for FinTech firms but needs time to study the concept.

“I’m not sure what it looks like and how it’s funded, but I do think there’s a space there that a technology solution can solve. Then the question is what is the requirement on that FinTech to get that charter.”

Otting addressed the fact that FinTech firms have filled a void in the small-dollar bank lending business after regulators “forced banks out of that space” with tough financial regulations. He went on to say that he hoped banks would reenter the business with their own FinTech solutions, “but I also am open to other entities coming in and providing those services if they’re not being fulfilled by the banking industry.”

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