Federal regulators question US progress on national digital currency

In front of the Congress, OCC director Brian Brooks described the importance of innovation in digital assets and the private sector

To compete in the global central bank currency (CBDC) race, the US will need to focus on the private sector, explains Brian Brooks, Acting Comptroller of the Currency.

„We have built private stablecoins in this country that already have a tens of billions of dollars market cap,“ Brooks said Thursday at a hearing of the U.S. House Committee on Financial Services. Former director of Coinbase’s legal department, Brooks currently heads the Office of the Comptroller of the Currency, or OCC, the Treasury division that regulates federal banks. „These assets are being transferred every day, are growing rapidly, and are being used for broad commercial purposes,“ he stressed, adding:

„In this country we don’t have to waste time building a governmental command and control solution. I believe that the private sector is already working on this, and I believe that the role of the regulators here is to provide a framework to ensure that no counter runs or other problems occur to the detriment of consumers“.
The conference committee met two days ago in digital form, questioning four witnesses from the main regulators.

Brooks‘ comments came in response to questions from Minnesota representative Tom Emmer. Emmer highlighted the promise of the fintech industry and the regulators, people and actions that have promoted its growth.

In addition, Emmer spoke about OCC and its recent actions, including clarity on bank custody services. Under Brooks‘ leadership, OCC provided two key clarifications for banks in the crypto sector this year, making cryptocurrency custody possible and approving the safekeeping of stablecoin reserves.

In his main question to Brooks, Emmer mentioned the aversion of Jerome Powell, chairman of the Federal Reserve, to the private development of digital assets. „President Powell informed us at a previous commission hearing that individuals and private sector innovations may not have a place in the Fed’s consideration of a digital dollar,“ Emmer said. „This is worrying.

„As a country, we have not yet recognised the important aspect of competitiveness in this context,“ Brooks explained in response to Emmer regarding the growth of digital assets. He went on to mention ongoing activities and trials on Chinese CBDC:

„In this country we are still a long way from a national real-time payment system. I come to the conclusion that the best solution is to win the way America has always won, unleashing the power of our innovative, dynamic and enterprising private sector.