FDIC determines bold reforms on the formation of banks, encryption policy and preparation for a solution
The Federal Insurance Company (FDIC) launches a new set of organizational changes to encourage the formation of new banks, improve the supervision of encrypted currency, and is better prepared for a possible failure in large banks.
Travis Hill (FDIC) went through this Reforms in his speech To express how the agency deals with financial innovation and stability.
He pays FDIC to restore community banks
The number of banks ’covenants in the United States decreased from more than 8,500 in 2008 to about 4,500 today, and Hill explains that the main reason is that many banks merged while less than six banks were formed annually.
FDIC plans to support the creation of new banks in deprived areas by reducing capital requirements for applicants looking to register in simple traditional banks. Hill said in his speech that about 68 million Americans reside in provinces without the local community banks.
FDIC also wants to reconsider how to review deposit insurance requests from technology -based banks because it is better to organize these groups rather than allow them to work through complex partnerships.
FDIC reduces encryption rules to support innovation
New FDIC guidelines allow banks to start encryption services without proceeding with permission, but on condition of properly managing risk and communicating with their organizations.
Hill said that FDIC is now looking at encryption like any other bank that we transfer actively, but it is prohibited to use General Blockchain even though other countries allow this.
FDIC reconsidered how it dealt with the situation when the bank collapses after the Silicon Valley Bank failed and the signature failure in 2023.
Experts such as former FDIC President Sheila Bayer supports the issue and say sales will protect societies better and recover value. There was also criticism of the likes of China Alylikwick, who said FDIC was mistaken in reducing the surrounding regulations without following the process of setting the appropriate rules.
Hill responded to the critics by saying that FDIC will ensure that these banks meet high service standards while changing their bases to be more efficient and objective for new entities.
FDIC evaluates Stablecoin and technical guarantees for a banking solution
Hill also touched on new issues related to Stablecoins, especially in the context of the efforts of the continuing laws of Congress. FDIC reviews whether the regulations that govern the deposit insurance will be adjusted to clarify the eligibility standards of Stablecoin reserve deposits. Some areas of review include liquidity risk management, illegal financing protection, and cybersecurity standards.
In 2020 and 2021, the Currency Observer Office (OCC) granted multiple services related to encryption to national banks, including cublecoin, and participating in verification of Blockchain health, and acceptance of deposits associated with Stablecoin. Now, FDIC weighs whether the place of permissible activities will be clarified and where it may start or expand it on the organizational guidance to add more use cases.
The speech also highlighted the need for more clear organizational coverage of assets and opponents in the real world, such as the deposits of distinguished commercial banks. Hill stressed that FDIC sees “deposits as deposits, regardless of technology or preserving the books used.
But it raised questions about the ability of the corresponding parties to withdraw equal in the event of bank failure through smart contracts, indicating that this may raise accuracy costs if the guarantees on these external flows are non -protective. This anxiety is to stimulate the internal FDIC efforts to consider technical solutions that can prevent unintended money movements when the banks are resolved.
According to Hill, the challenge is to reconcile the programming of the series with the traditional guarantees integrated into a financial organization aimed at enhancing an organized solution to institutional failure.
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