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U.S. banking regulators are developing a more relaxed and transparent framework for banks participating in cryptocurrency activities. Recently, the acting chair of the Federal Deposit Insurance Corporation (FDIC) elaborated on the agency's evolving stance on crypto-related activities at a banking industry summit.
A key area that the FDIC is reviewing is the interaction between regulated banks and public permissionless blockchains. While regions outside the United States have long allowed banks to use public chains, U.S. regulators have been more cautious. The FDIC now believes that a complete ban on the use of public blockchains is too strict, but appropriate safeguards are still needed.
The agency is evaluating the existing cross-institutional guidance to develop long-term standards for the responsible use of public networks. It is also considering whether public chains can operate in a permissioned model. Regulators must assess how to define and regulate blockchain configurations that blur the lines between open and permissioned environments.
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