Date
18 November 2018
Joseph Otting, the head of the US Office of the Comptroller of the Currency, has played down bitcoin fears in his first formal press briefing on Wednesday. Photo: Reuters
Joseph Otting, the head of the US Office of the Comptroller of the Currency, has played down bitcoin fears in his first formal press briefing on Wednesday. Photo: Reuters

Bitcoin currently not a threat to banking system: US regulator

Bitcoin does not currently pose a threat to the US banking system, a regulator said on Wednesday, pointing out that banks have little exposure to the virtual currency.

Joseph Otting, who was sworn in as US Comptroller of the Currency last month, in his first formal press briefing in Washington played down concerns over risks posed by bitcoin, Reuters reports.

“Mostly the banks have stayed away from the currency … it doesn’t seem to have come into the banking system,” Otting said, adding that his office feels the digital unit does not currently pose a threat to the safety and soundness of the banking system.

“But everybody’s watching it very closely,” he told reporters, after bitcoin raced to new highs of US$19,666 on Sunday.

In other comments, Otting, the head of the Office of the Comptroller of the Currency, said he sees a future for a charter for fintech firms, first proposed by his predecessor Thomas Curry, but that he 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.”

Otting noted that fintech firms were pouring into the small-dollar lending business to fill a void after regulators had “forced banks out of that space” with burdensome regulations, and that he hopes banks will re-enter 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,” he added.

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RC

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