JPMorgan: Global Regulation Urgently Needed for Banks to Help Clients Invest in Crypto
According to JPMorgan executive Debbie Toennies, managing director and head of regulatory affairs at JPMorgan Chase & Co, banks must be allowed to handle crypto assets.
At a February conference by the International Swaps and Derivatives Association, Richard D. Rosen talked about global cryptocurrency regulation applicable to banks.JPMorgan executive said new rules are required to give banks certainty in dealing with crypto assets on behalf of large customers interested in this asset class.
Large institutions, such as hedge funds are increasingly interested in investing and gaining exposure to crypto-assets. According to Wells Fargo, the cryptocurrency market has entered the “hyper adoption phase.”
Toennies noted that some huge players had asked JPMorgan to hedge their exposures to crypto-assets.
The Basel Committee on Banking Supervision considers rules for banks dealing with crypto assets. Last year, the Committee proposed separating crypto assets into two groups and regulating them based on their market, liquidity, credit, and operational risks to banks. However, we don’t expect the final rules until the end of this year.
According to Toennies, all of our economies are at risk. Suppose we do not find a solution that allows banks to engage with their clients in a hedged manner. In that case, these activities will go outside the regulatory framework, and she is concerned about financial stability.
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