Regulators should aim for controlled supervision of cross‑border cryptocurrency firms, Hsu said.
Acting U.S. Comptroller of the Currency Michael J. Hsu urged the creation of a more comprehensive regulatory framework to address risks posed by large, cross‑border cryptocurrency exchanges. His comments come amid intensified enforcement on crypto mining in China and growing regulatory scrutiny of digital‑asset firms worldwide.
Speaking at the American Fintech Council’s 2021 Policy Summit, Hsu warned that major cryptocurrency companies with international operations present risks that current rules do not fully cover. He called for these global platforms—especially those that issue widely circulated stablecoins—to be brought under “comprehensive, controlled supervision.”
Hsu recommended that federal and state bank regulators prioritize developing policies, staffing, and supervisory methods that acknowledge the limitations of existing standards. He said this would be the first step toward safely integrating large crypto firms into the banking regulatory perimeter:
“This would clearly differentiate safe and sound crypto firms from those that are regulated only partially and have a history of control lapses, such as Binance and Tether.”
He also suggested considering a separation of activities in the crypto sector similar to Glass‑Steagall, to ensure wholesale and retail activities remain distinct as the industry grows rapidly.
Glass‑Steagall was a provision of the U.S. Banking Act of 1933 designed to separate commercial and investment banking; it was repealed in 1999.
Hsu additionally addressed the rise in scams and consumer complaints that has accompanied the expansion of crypto users and the market’s overall value.
“‘Move fast and break things’ is a common mantra in tech. In the financial services context, it is important to remember that those ‘things’ are people and their money,” the regulator noted.
The Office of the Comptroller of the Currency operates within the U.S. Department of the Treasury and is responsible for supervising and regulating national banks and federal savings associations.