US Bank Regulator Charts Path for Blockchain Startup Oversight

A US banking regulator has unveiled a broad innovation policy aimed at regulating startups working with blockchain and other fintech.

On 26th October, the Office of the Comptroller of the Currency (OCC) released its “responsible innovation framework”, a policy outline that the agency has been working on since earlier this year. In March, the OCC released a white paper setting out its objectives.

The agency will establish an “Office of Innovation”, headquartered in Washington, DC, that will spearhead policy development and outreach as it relates to fintech.

The head of that office, who will be appointed as the chief innovation officer for the OCC, will report directly to Comptroller Thomas Curry. The OCC said it will also expand internal training programs to educate staff on technologies like blockchain.

In its report, the agency sought to highlight the rapidly evolving face of finance, noting:

“Today, fintechs engage in the traditional banking functions of consumer lending, payments, wealth management, and settlements. Fintechs also are leveraging new technologies and processes, such as cloud computing, application programming interfaces, distributed ledgers, artificial intelligence, and big data analytics.”

The OCC has sought to present an active voice amidst the shifting regulatory landscape for the technology in the US, calling last year for a “balanced” approach to bitcoin regulation. At the same time, the OCC included the tech in a banking risk assessment released in July.

The framework launch, however, is only the start of what could be a more significant – and contentious – process.

Earlier this year, the OCC began looking at the question of whether to create a special kind of federal charter for fintechs. As of this week, that process is still ongoing.

“The OCC’s assessment of granting a special purpose national bank charter to nonbank financial technology companies, and under what conditions, continues,” the agency said. “The OCC has made no determination regarding chartering of these firms.”

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