Brian Brooks, the Acting Comptroller of the Currency and former head of Coinbase’s authorized division, put ahead blockchain as higher than the United States’ present bank-dependent funds system.
Decentralization for future funds
On July 29, Brooks spoke with Aaron Klein of the Brookings Institution, a serious U.S. suppose tank. In reply to hypothetical platforms for a future five-year time period as Comptroller — Brooks is, at this level, in a liminal state as performing comptroller — Brooks emphasised decentralization:
“I’m a believer in decentralization. At the end of the day, I think that stablecoins and other blockchain-based tokenization of dollars are the most resilient model for long-term faster payments. Better than a central bank monopoly on the payments system.”
The authorities’s response to the COVID-19 pandemic delivered to mild quite a lot of long-standing points with funds programs. The dialog right now emphasised the sadly technological limitations to sending $1,200 funds to U.S. residents just a few months in the past.
The position of banks within the funds system
The Office of the Comptroller of the Currency (OCC) is the workplace of the U.S. Treasury that handles federal banks. Just final week, the office made headlines for giving federally chartered banks the go-ahead to custody crypto property. However, a degree that arose in right now’s dialogue was an fascinating historical past lesson.
As Brooks identified, the OCC got here into existence because of the National Currency Act of 1863, not the National Banking Act of 1864, as is often thought. The 1864 Act did alter its predecessor and shift its focus onto banking regulation however, Brooks mentioned: “Initially the idea was to create a single system of competitive payments.”
Klein and Brooks agreed that the best way cash operates within the U.S. is caught up to now. “A hundred years ago we had the most advanced financial system in the world, and we still have the most advanced system in the world c. 1910,” Brooks commented.
In phrases of updates to the trendy system, the Comptroller mentioned that regulators had been pushing for varied options with restricted outcomes. “As a regulator, the question is, how do you do that,” Brooks mentioned. “FedNow does not yet exist except on paper.” He did, nonetheless, spotlight tech that already exists and is acquainted to the crypto group as a possible answer:
“There are also existing private sector blockchain technologies on smart contracts where one can simply program the stuff and hit the automate button that instantly appear to anyone on that network.”