Chief executives of several leading US banks expressed caution about dealing in cryptocurrencies in testimony released ahead of a sometimes contentious hearing before a Senate committee on Wednesday.
The remarks by Bank of America’s Brian Moynihan, Citigroup’s Jane Fraser and Wells Fargo’s Charles Scharf came as US financial regulators scramble to respond to the explosive growth — and dizzying volatility — of a crypto market that currently lacks an overarching national supervisor.
Financial groups are simultaneously facing pressure from consumers and companies that want a piece of the action — and from regulators who have openly fretted about a trading environment that “could benefit from greater investor protection”, in the words of Gary Gensler, chair of the Securities and Exchange Commission.
Moynihan hinted at the difficulties for financial executives in his testimony, saying BofA was keeping distance from the business of bitcoin and its brethren even as it continued “to evaluate the opportunities, risks and client demand for products and services related to cryptocurrency”.
“Currently, we do not lend against cryptocurrencies and do not bank companies whose primary business is cryptocurrency or the facilitation of cryptocurrency trading and investment,” he said.
Moynihan added that while his bank holds more than 60 patents involving blockchain — the ledger technology underpinning cryptocurrencies — “we still have not found a use case at scale”.
Fraser said Citigroup was taking a “measured approach” as it