Acting Comptroller of the Currency Michael Hsu described the crypto industry as “immature” and full of conflict and risks in remarks given at DC Fintech Week.
Fintech giants have increasingly argued that blockchain technology allows them to offer financial services similar to those consumers expect from banks, brokerages and investment firms. Hsu said he’s concerned about integrating crypto into the traditional financial system without a more “accurate-and-complete” view of the risks.
“Crypto today is an immature industry based on an immature technology,” Hsu said. He added that his comment was not meant to be disparaging, but that the industry still needed to deal with “the unabating volume of scams, hacks and fraud.”
“The largest crypto players today want to provide an increasingly broad range of services seamlessly under one roof for their customers,” Hsu added. “While commingling these activities may offer convenience for consumers and cost savings for crypto firms, conflicts abound and the riskiest activity threatens the whole bundle.”
Since taking leadership of the OCC last year, Hsu has focused a portion of the banking regulators efforts on determining how to handle digital assets. While they’ve downplayed systemic risks, U.S. regulators have been sounding the alarm about the possible systemic dangers of widespread adoption of digital assets like cryptocurrencies and stablecoins.