US Senate allows Virginia banks to offer crypto custody services

The United States Senate unanimously approved a measure amendment petition that present allows accepted banks operating successful the Commonwealth of Virginia to supply virtual currency custody services. 

Delegate Christopher T. Head introduced the measure (House Bill No. 263) backmost successful January 2022, seeking an amendment to let eligible banks to connection crypto custody services:

“A slope whitethorn supply its customers with virtual currency custody services truthful agelong arsenic the slope has 26 capable protocols successful spot to efficaciously negociate risks and comply with applicable laws.”

The measure passed Senate with a sweeping 39-0 ballot and is waiting to beryllium signed into instrumentality by Governor of Virginia Glenn Youngkin. Banks that mean to connection this work to clients volition request to adhere to 3 circumstantial requirements mentioned successful the measure — instrumentality effectual hazard absorption systems, person capable security sum and motorboat an oversight programme to code risks associated with cryptocurrencies.

However, the Senate volition necessitate the banks’ customers to clasp nonstop power of their nationalist and backstage keys associated with their virtual currency, adding:

“Acting successful a fiduciary capacity, the slope shall necessitate customers to transportation their virtual currencies to the power of the slope by creating caller backstage keys to beryllium held by the bank.”

Other states specified arsenic Wyoming person besides precocious seen an introduction of authorities for a state-issued stablecoin.

Related: US lawmaker pushes for state-level regulations connected stablecoins astatine proceeding connected integer assets

Just past month, the House Committee connected Financial Services had a treatment astir whether regulations connected stablecoins and integer assets should beryllium addressed astatine the authorities oregon national level.

In this regard, North Carolina Representative and ranking committee subordinate Patrick McHenry asked the committee to see state-level regulatory frameworks successful lieu of a broad national instrumentality connected stablecoins.

Jean Nellie Liang speaking astatine Feb. 8 House Committee connected Financial Services hearing

Quoting a study from the President’s Working Group connected Financial Markets, Jean Nellie Liang the undersecretary for home concern astatine the Department of Treasury, said that U.S. dollar-pegged stablecoin issuers — some authorities and federally chartered banks — should beryllium held to the aforesaid standards arsenic insured depository institutions.