Traditional Finance Giants Urge Crypto Czar to Include Federal Banking Agencies in PWG

The traditional finance industry, represented by a coalition of prominent associations, has called on David Sacks, the White House's crypto czar, to include federal banking agencies in the President's Working Group (PWG) on digital assets. In a joint letter, the American Bankers Association, the Financial Services Forum, the Bank Policy Institute, The Clearing House, the Association of Global Custodians, and the Securities Industry and Financial Markets Association (Sifma) expressed their strong support for the PWG's goals.

The group, however, believes that many regulations and instructions on digital assets from regulators should be rescinded or watered down, particularly those requiring extensive approval processes for every crypto-related activity. They argue that since banks are now heavily involved with digital assets, federal banking regulators should play a more significant role in developing the industry's regulatory framework.

The traditional finance network emphasizes the critical importance of including federal banking agencies in the PWG, given that banks are an essential component of the financial and payments system. They argue that the participation of these agencies will help ensure that the goals of the executive order are met and that the United States can achieve a leadership position in digital assets and financial technology.

The group contends that the policies and guidance issued by federal banking agencies over the last few years regarding digital assets activities have hindered banks' ability to engage in those activities and, in turn, the competitiveness of the United States financial system. They assert that the United States will not be able to achieve a leadership position in digital assets and financial technology under the current status quo.