Yesterday, in a watershed decision by the US Office of the Comptroller of the Currency, crypto-asset custody firms can now procure a banking charter in the U.S.
The major difference brought about by the decision is bypassing the bitlicense and trust co. charter. The banks will have a significant advantage over the current scheme of things.
According to Caitlin Long, a crypto entrepreneur leading the blockchain revolution in the U.S. state of Wyoming and founder of Avanti Bank this is positive news for customers and crypto VCs. She tweeted,
Banks can do all kinds of things that non-banks can’t do, mostly bc ONLY banks have direct plumbing into US dollar payment systems… The big banks generally know this, tho, which is why I believe an M&A boom is abt to start in the industry
Moreover, she also mentions that the way forward from here will be led by mergers and acquisitions. Hence, the chickens are coming to roost for VCs and early entrepreneurs in the space. This is primarily because banks neither have the expertise nor the experience of working with crypto.
She also mentions the advantages that Wyoming currently has over other U.S. states. This is because of the progressive legislative structure of crypto in Wyoming. She says,
…I worry it’s not possible for a bank to custody #crypto in a safe & sound manner anywhere in the US except in #Wyoming.
Furthermore, taking advantage of the settings in the state, the CEO of Avanti Bank is awaiting approval to begin its operations (expected by October).
One of the frontrunning projects of Avanti will be ‘Avit’, for digital payments. According to her, this will be a ‘stablecoin disruptor’ and also compete with Central Bank Digital Currency (CBDC) of the future because it will be anchored to ‘a public blockchain.’
The adoption of such a project will be massive for the crypto industry. In all probability, we’re looking at Ethereum or possibly Bitcoin blockchain implementation for cash equivalent transactions as well. She tweeted,
Called #Avit, it’s nicknamed the “#stablecoin disruptor.” It’s not a security & will prob be treated as a cash equivalent (a v. BIG DEAL!!).
#Avit has been thru the regulatory wringer. It has no comparable in the market today, nor will it, #probably. Anchored to public #blockchains, it’s better than a #CBDC.
A plethora of opportunities is opening up for crypto led by leading financial institutions including VISA and MasterCard. Direct participation of Financial Services (FS) will now transform the space in a whole new way.
How do you think the new decision will transform the crypto industry and its perception? Please share your views with us.