“Based on the agencies’ current understanding and experience to date, the agencies believe that issuing or holding as principal crypto-assets that are issued, stored, or transferred on an open, public, and/or decentralized network, or similar system is highly likely to be inconsistent with safe and sound banking practices.”
The Office of the Comptroller of the Currency (OCC) has appointed Kristen Baldwin as Chief Information Officer (CIO), effective February 26, 2023.
Kristen Baldwin will lead all OCC information technology (IT) programs, supporting the agency’s mission of ensuring that national banks and federal savings associations operate in a safe, sound, and fair manner.
“Extensive experience developing IT strategies”
Acting Comptroller of the Currency Michael J. Hsu, said: “Kristen brings extensive experience developing IT strategies and services that are both effective and efficient. We are fortunate to have her leadership and expertise at the OCC.”
Kristen Baldwin joins OCC from the Federal Aviation Administration (FAA), where she served as the Assistant Administrator for Information and Technology Services and the CIO. At the FAA, she was responsible for the delivery of IT services and products that enable the FAA’s mission and strategic plan.
Prior to that, she held several leadership positions within the U.S. Department of Transportation, serving as Deputy CIO and as Associate CIO for IT Policy and Oversight. She also served as the Director of the Resource Management Office for the Office of the Chief Information Officer.
OCC concerned about crypto-asset risks in banking system
Earlier this year, the Office of the Comptroller of the Currency (OCC) issued a joint statement together with the Fed and the FDIC in regard to crypto-asset risks to banking organizations.
The statement follows the significant volatility triggered by the events in 2022 which have exposed vulnerabilities in the crypto-asset sector and highlighted a number of key risks associated with crypto-assets and crypto-asset sector participants that banking organizations should be aware of.
Of these risks, the three federal institutions focused on eight, including fraud/scams, regulatory uncertainty, misleading representations, volatility, stablecoin risk, contagion risk, lack of maturity of risk management and governance, and heightened risk of decentralized networks.
The Fed, FDIC, and OCC reminded how important it is that such risks that cannot be mitigated or controlled do not migrate to the banking system.
“Based on the agencies’ current understanding and experience to date, the agencies believe that issuing or holding as principal crypto-assets that are issued, stored, or transferred on an open, public, and/or decentralized network, or similar system is highly likely to be inconsistent with safe and sound banking practices. Further, the agencies have significant safety and soundness concerns with business models that are concentrated in crypto-asset-related activities or have concentrated exposures to the crypto-asset sector.
“Banking organizations should ensure that crypto-asset-related activities can be performed in a safe and sound manner, are legally permissible, and comply with applicable laws and regulations, including those designed to protect consumers (such as fair lending laws and prohibitions against unfair, deceptive, or abusive acts or practices). Banking organizations should ensure appropriate risk management, including board oversight, policies, procedures, risk assessments, controls, gates and guardrails, and monitoring, to effectively identify and manage risks.”