Hello fintech friends,

Mostly crypto headlines this week, no surprise as the Biden EO signals a landmark moment for government’s direct engagement on the issue. Can’t wait for the next rounds of publications and cycles through the whirlwind of crypto takes once the requested reports come out in the Fall.

• Biden EO is crypto regulation’s Rorschach moment: After weeks of signaling, the Biden White House published its Executive Order on Digital Assets. The Order targets a whole-of-government approach to regulating crypto, calling for the production of fifteen reports from a range of government agencies including financial regulators. While introduced as a consumer protection and market risk management framework, the report is decidedly vague about desired outcomes - leaving those determinations to the agencies themselves. As a result, crypto skeptics and advocates equally rejoiced, and the order itself received bipartisan praise. The former enforcement chief at the SEC said companies should “be careful what they wish for.”
• Department of Labor cautions employers against offering crypto in 401ks: The regulator in charge of overseeing retirement plan providers - aka, companies that manage their employees’ 401ks and pensions - published compliance assistance telling those providers to “exercise extreme care before including direct investment opportunities in cryptocurrency.” Groom Law Group, an expert practitioner, clarifies that this publication is effectively a threat to sue providers who do go ahead and offer crypto as part of their retirement packages, and calls this a “material break from DOL regulatory norms.”
• California lawsuit shows battle for state interest rates continuing: An online lender is filing for injunction against the state of California, claiming that its loans should not be subject to state interest rate caps because it is partnering with an out-of-state bank. This is just the latest in a years-long debate over bank-fintech partnerships in the lending space.
• UK’s Financial Conduct Authority orders crypto ATMs shut down: The financial regulator clarifies that none of the ATM providers have obtained proper licensing and are therefore operating outside the legal bounds.
• Full March slate for House Financial Services Committee: From “The End of Overdraft Fees” to “The Future of Money: Assessing the Benefits and Risks of a U.S. Central Bank Digital Currency,” it’s shaping up to be a busy month of hearings under Chair Maxine Waters’ watch.

Cheers,

Ben