Congress should seek ways to enable credit unions to provide services related to digital assets so that those services can be properly overseen by regulators, CUNA wrote to the Joint Economic Committee. CUNA called for similar actions by the NCUA to help credit unions keep abreast of technologies to serve members in a letter sent last month.
“Our fear is that cryptocurrency and blockchain-based financial platforms are creating an unregulated financial sector that could have major repercussions on the U.S. economy,” the letter said.
Congress is also expected to consider ways to regulate the delivery of digital currencies to ensure consumer protection.
CUNA notes that credit unions are “highly regulated” in their operation and that members of credit unions are “protected by a plethora of consumer protection laws,” while the crypto and currency sectors digital technologies operate “largely outside traditional financial guarantees”.
“In fact, like fintech, once you go through new technology, the fundamental innovation in cryptocurrency is the elimination of the financial middleman,” the letter read. “Unfortunately, when there is no financial intermediary, the functions they perform are also lost. Just look no further than the lost access to bitcoin for those who have lost or forgotten their passwords on their digital wallets for a simple yet powerful example of the function middleman.