US Consumer Protection Agency Might Introduce E-banking Laws to Digital Assets
The director of the Consumer Financial Protection Bureau (CFPB) disclosed that the agency is considering transplanting e-banking laws to digital assets.
Speaking at the Bookings payment conference on Oct 6, Rohit Chopra said that the agency might apply the Electronic Fund Transfer Act (EFTA) to protect investors and users in the crypto ecosystem.
According to him, to create a safe space for users, the CFPB mulls rolling out traditional finance measures for virtual assets.
“To reduce the harms of errors, hacks, and unauthorized transfers, the CFPB is exploring providing additional guidance to market participants to answer their questions regarding the applicability of the Electronic Fund Transfer Act with respect to private digital dollars and other virtual currencies.”
This comes on the heels of recent spikes in activities of bad actors in the digital asset market.
If the EFTA gets applied to crypto, virtual asset firms will be required to make certain changes to their operations regarding disclosures and other issues.
Banks and other associated financial institutions are mandated to disclose the extent of their liability before every electronic transaction.
This will help reduce the significant losses users have faced from unauthorized crypto transactions in recent years.
Speaking towards the theme, “Making America’s payment system work for a digital century” he added the agency will examine the role non-banks play in the crypto market as some offer payment platforms that ought to be safe and secure.
He pitched the Treasury’s Financial Stability Oversight Council to flag some crypto activity as systemically important to provide parties and agencies with the tools to ensure that “a stablecoin is actually stable.”
Finally, in
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