US banking giant Morgan Stanley said in a research note that regulators’ regulation on crypto banks could come sooner than expected.
Morgan Stanley published a research paper last week. The note stated that regulators are working to develop a set of rules for crypto banks earlier than expected. This is the Federal Reserve, Federal Deposit Insurance Corp. (FDIC) and the Office of the Comptroller of the Currency (OCC) outlining a policy to develop rules for firms serving in the crypto space.
Company analysts said in the aforementioned report that well-crafted regulations will accelerate the adoption of cryptoassets. This is a positive development for companies such as leading crypto banks Silvergate and Signature.
Also, the biggest risk is that policymakers may act too quickly to unintentionally block adoption of cryptos, and regulators may adopt (or ban) a highly restrictive stance that will severely hinder the growth of the space.
The note also included services that would be covered by this new framework. These are storage; facilitating customers’ trading of cryptoassets; loans secured by cryptoassets; issuance and distribution of stablecoins; and activities that involve holding crypto assets on banks’ balance sheets.