American Investment Bank TD Cowen has sent a note to its client addressing the relationship between financial entities and the Bitcoin Ecosystem (BTC) and cryptocurrency.
According to the banks, enhanced clarity of regulations could tempt banks to act as seductive custodians, but these will continue to limit exposure until there is greater certainty about how to act in the case of money laundering.
TD Cowen points out that if banks do not stop money laundering and other related crimes, they face serious problems. Banks believe that greater clarity on cryptocurrency can attract banks and act as cryptocurrency custodians, but “but they will continue to want legal clarity given the serious liability they face if they do not stop money laundering, terrorist financing or sanctions from escaping money laundering, terrorist financing, or sanctions.”
Jaret Seiberg, president of TD Cowen, said while banks limit their exposure to cryptocurrency, “there are risks associated with bank secret laws and money laundering.
Seiberg adds that sanctions for violations of these laws are “too expensive for banks to consider providing general services to the cryptocurrency sector without higher legal clarity.”
This issue has recently gained relevance after the Bag and Securities Commission (SEC) ruled out Human Resources Accounting Breaking Report 121 (SAB 121), as reported in Cryptonotics.
SAB 121, imposed by the management of the previous Banquero Gary Regensler, is essentially Prevented banking officers from providing cryptographic active servicesincluding custody. Gensler was characterized by a strict, persecutor approach to the Bitcoin industry and cryptocurrency.
The US Congress is scheduled to hold two public hearings this week, focusing on adoption. One to the Senate Banking Committee on Wednesday, and the other to the House of Representatives’ Financial Services Committee on Thursday. One of these sessions could lead to debate about the requirements banks face with regard to cryptocurrencies, according to comments from regulators such as the Laneda Secretary’s Office.
The elimination of SAB 121 is How banks interact with cryptocurrency Without prejudice to your obligations. The central theme is the balance of financial innovation and how to prevent and detect illegal activities. According to TD Cowen, banks are in a position to require clarity in regulations to move safely in this new digital land.
Financial community and cryptocurrency investors are hoping for a clearer path Integrating these assets into traditional banking systems. However, until clear rules are established, banks will continue to take a cautious approach and limit their exposure to these digital assets due to risks associated with money laundering and other criminal activity.
(tagstotranslate)Banks and Insurance
