Congress should look for ways enable credit unions to provide digital asset related services so these services can be properly overseen by regulators, CUNA wrote to the Joint Economic Committee. CUNA has called for similar actions from NCUA to help credit unions stay current with technologies to serve members in a letter sent las month.
“Our fear is that cryptocurrency and blockchain based financial platforms are creating an unregulated financial sector that could have major repercussions to the U.S. economy,” the letter reads.
Congress should also examine ways to regulate the delivery of digital currencies to ensure consumer protection.
CUNA notes that credit unions are “highly regulated” in their operation and credit union members are “protected by a plethora of consumer protection laws,” while the crypto and digital currency sectors operate “largely outside of the traditional financial safeguards.”
“In fact, like fintech, once one wades through the novel technology, the fundamental innovation of cryptocurrency is the elimination of the financial intermediary,” the letter reads. “Unfortunately, when there is no financial intermediary, the functions that they provide also are lost. One only has to look no further than lost access to bitcoin for those that lost or forgot their passwords to their digital wallets for a simple but powerful example of the function intermediary.”