How the SEC threw a wrench in bank regulators’ crypto custody efforts
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SEC Staff Accounting Bulletin No. 121, issued in March, requires most registrants that hold crypto assets for clients to record that risk on their balance sheets as a liability. That has set off a flurry of talks between regulators and banks. Experts say it'll be difficult for regulators to move forward in giving banks clarity until that hurdle with the SEC is cleared. Federal Reserve Chairman Jerome Powell hinted last week that bank regulators are working on the issue, although he declined to provide more details. The FDIC is working closely with the other banking agencies to better understand the risks associated with custodial arrangements involving crypto assets, an FDIC spokesperson said in a statement. Trade groups representing the banking industry have asked the agency to delay the implementation of the bulletin. Source