banking-and-finance

Treasury official doubts fintech needs payment system overhaul
Analysis appeared in blog

Matt Swinehart, a senior counsel at the Treasury Department, says a massive “regulatory rethink” for financial technology won’t be required. (Bill Clark/CQ Roll Call file photo)

A senior Treasury Department official is challenging the idea that rapidly evolving financial technology will require a sweeping overhaul of rules governing payment services and the electronic transfer of funds between consumers, banks, merchants and others.

In a recent analysis, Matt Swinehart, a senior counsel at Treasury, said a massive “regulatory rethink” of payment services won’t be required because many rules and standards governing payments are what he called technology neutral. The analysis appeared on a blog about the intersection between financial technology and government policy. Swinehart and the Treasury Department declined an interview request about his statements.

Green New Deal: Some Democrats on the fence
Top Democrats who would oversee legislation in the House are reluctant to endorse plan that would remake economy

Democratic Sen. Ed Markey and Rep. Alexandria Ocasio-Cortez have championed the Green New Deal on Capitol Hill. (Bill Clark/CQ Roll Call file photo)

A resolution outlining the goals of the Green New Deal capped off its first week of a somewhat messy rollout with mixed reviews, even from typically Democratic strongholds like labor unions.

In the House, the top two Democrats who would oversee any legislation that comes out of the plan have remained reluctant to fully endorse it, stopping at lauding the goals and the enthusiasm behind them. And Republicans quickly branded the Green New Deal as an extreme, socialist plan with unrealistic proposals to eliminate air travel and cows.

Elizabeth Warren keeps pressure on big banks to help workers during government shutdowns
In letters shared first with Roll Call, Warren said inquiries could be particularly important if ‘agreement in principle’ falls apart

Sen. Elizabeth Warren is keeping up the pressure on big banks. (Sarah Silbiger/CQ Roll Call file photo)

As lawmakers work to avoid another partial government shutdown, Sen. Elizabeth Warren is keeping up pressure on big banks to make sure they help federal employees and contractors, especially if the “agreement in principle” falls apart.

“We are now less than a week away from the February 15 deadline to fund the government, and President Trump has threatened to drag the American public through a shutdown for a second time,” the Democrat from Massachusetts wrote in a series of new letters shared first with Roll Call.

House passes cryptocurrency, insider trading bills
Measures were delayed by debate over spending proposals

The House has passed three bills related to cryptocurrency and insider trading. (Dan Kitwood/Getty Images file photo)

After a week of shutdown-related delays, the House has passed three financial services bills that had been expected to receive floor votes early last week, but were delayed as the House debated spending proposals.

Lawmakers agreed by voice vote Monday to pass under suspension of the rules a bill  co-sponsored by Reps. Ted Budd, a North Carolina Republican, and Stephen F. Lynch, a Massachusetts Democrat, that would create an interagency task force led by the Treasury secretary to research how new financial technology, or fintech, is being used in financial crimes and terrorism, and develop regulatory and legislative responses. The bill would also establish a grant fund for programs and ideas for preventing terrorists and other bad actors from using cryptocurrencies for nefarious ends.

House to take up three bills to curb cryptocurrency abuses
One measure would create interagency task force

Rep. Ted Budd, R-N.C., is cosponsoring a bill that would create an interagency task force led by the Treasury secretary to research financial crimes and terrorism, including those using cryptocurrency. (Bill Clark/CQ Roll Call file photo)

The House is expected to take up and pass a trio of bills that focus on cryptocurrency’s ability to facilitate illicit activities.

The three bills were introduced in the last Congress and easily passed the full House with bipartisan support before stalling in the Senate. Two of the bills center on how new financial technology, or fintech, could be used by terrorists, and the third looks at fintech’s use in sex and drug trafficking.

Elizabeth Warren wants big banks to give details of assistance to furloughed federal workers as shutdown continues
Democratic senator highlights more transparency from credit unions about help for the workers who are not being paid

Sen. Elizabeth Warren, D-Mass., wants details of what large banks are doing to help customers affected by the partial government shutdown. (Tom Williams/CQ Roll Call file photo)

Sen. Elizabeth Warren wants specifics from big banks about what they are doing to help federal workers who haven’t received paychecks due to the partial government shutdown.

The Massachusetts Democrat, who is often an adversary of large financial institutions, actually praised some of them for public statements expressing support for the furloughed federal employees (and those required to report to work without pay).

Fintech sector hurt by shutdown
Federal government’s influence more expansive than expected

The government shutdown is starting to create serious problems for financial technology firms and has put some policy development on hold. (Ethan Miller/Getty Images file photo)

ANALYSIS — The consequences of the partial government shutdown for the poor, the environment, federal employees and those relying on government services or benefits have become painfully evident, and are getting worse. The shutdown is also starting to create serious problems for financial technology firms — slowing dealmaking, impairing supervision and casting a pall over the presumed pre-eminence of the U.S. as a fintech superpower.

It’s coming as quite a surprise for many Silicon Valley investors and Wall Street firms that have long viewed the federal government as a drag on innovation rather than a facilitator of it.

EU reports on cryptoasset regulation could have global reverberations
Watchdogs urge EU-wide rules

A sign in a Berlin pub signals the owner’s acceptance of bitcoin. Reports on cryptoasset regulation in the European Union could have global reverberations. (Sean Gallup/Getty Images file photo)

 

ANALYSIS — Two leading financial regulatory authorities are preparing to release pivotal reports on cryptoasset regulation throughout the European Union with recommendations that set the stage to create a separate “bespoke” regime for cryptoassets that are not currently subject to regulation in the bloc.

US relies on old rules to police cryptoassets
Europe appears to be on different fintech track

Rep. Tom Emmer, R-Minn., who is part of the Congressional Blockchain Caucus, has called on the U.S. government to lightly regulate the emerging technology. (Bill Clark/CQ Roll Call file photo)

Despite calls for international unity on financial regulations following the 2008 financial crisis, the United States is unlikely to follow Europe in exploring a unique regulatory regime for “cryptoassets,” whether for payment models like bitcoin or utility tokens that have been touted by celebrities as can’t-miss investments.

The U.S. approach, which has been reaffirmed several times by regulators, is to apply standard rules and tests dating back to the 1930s to fintech, or financial technology, products when determining whether agencies have authority over them.

Divided government will pose an obstacle to lawmaking in 2019
Congress was most dysfunctional from 2011 to 2014 when control of House and Senate was split

The partial government shutdown is already casting a dark shadow for prospects of what Congress might accomplish in 2019. (Bill Clark/CQ Roll Call)

Washington tends to work best when one party controls both Congress and the White House. It’s most gridlocked, usually, when control of Congress is split.

The Congress of the past two years demonstrated the first principle. By any honest measure, President Donald Trump and his Republican colleagues in the House and Senate got a lot done in 2017 and 2018.