Fintech task force primary focus: Cryptocurrencies and the need to support innovation

Members of the Fintech Task Force in the United States House of Representatives are no doubt watching cryptos and blockchain technology as solutions to problems posed by not financially included persons and a slow payments process.

The United States House Financial Services Committee (“HFSC”) formed last June 2019 two new task forces, one on Financial Technology (“Fintech”) and the other on Artificial Intelligence (“AI”) to better inform the HFSC’s legislative agenda on a wide variety of legal, regulatory, and policy issues of importance to the financial services industry.

The FinTech task force particularly focused on crypto in a house hearing dubbed “Is Cash Still King? People who worked for crypto were made to testify regarding payment providers, consumer advocates, and financial inclusion non-profits.

Some people who testified were observed to have attracted many audiences as Fintech task force members are serious to find out how cryptos and blockchain would solve financial inclusion and slow payment issues.

Fintech Task Force initiates debate on crypto

A ranking member of the Fintech taskforce, Rep. Tom Emmer who proposed cryptocurrency first to the house commented that “Apple Pay, Zelle, Square Cash, and even Bitcoin are now household names.”

However, Rep. French Hill who had a contrasting opinion to Emmer emphasized that “blockchain-based rail” in the banking system and quizzed witnesses if an approved regulatory payment which is blockchain-based equally available to both banks and non-banks?

The executive director at the US faster payment council, Kim Ford, explained that the system will bring regulatory issues and further, that it would NOT be a “restraint of technology being able to sustain the rail”, but would boil down to whatever policy limitations are in place. She said further that blockchain is inconsistently regulated these days.

However, Rep. Hill showed confidence in an interview explaining that the blockchain payment system with regulations opens to banks and non-banks allows a substitute payment means and is the direction they are headed.

He was also bullish regarding the possibilities of a digital dollar that would facilitate a large spectrum of transactions. “The idea that we have a dollar mechanism that is a token for commercial or consumer transaction is appealing.”

Regulations as the sticky point other than technology

The entire house had agreed that whatever the solution would be, US payment systems were falling behind. Many of them mentioned regulations as the sticky point other than technology. Christina Tetrault of Consumer Reports particularly commented.

American adoption of mobile payments continues to lag, Unfortunately, payments law is an irrational mess.

The Fintech taskforce chair, Like Hill, believes that crypto would continue to remain an important part of their discussion. He said he thinks the answer is technology as some maybe minor regulations but it would continue to be discussed.

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