The Credit Union National Association voiced its support for developing a comprehensive regulatory framework governing digital assets that protect consumers, financial institutions, and the economy.
“Credit unions are actively evaluating their options in the digital asset marketplace to best meet the needs of their members and to ensure the continued safety and soundness of their institutions,” CUNA officials wrote to the Department of Commerce’s International Trade Administration. The letter was in response to the federal agency’s request to comment on Developing a Framework on Competitiveness of Digital Asset Technologies (RFC).
CUNA contends that digital assets should provide an entry point for the unbanked and underbanked to receive quality, reliable financial services from a credit union.
The letter outlines the circumstances under which a central bank digital currencies (CBDC) should be considered. It should have congressional authorization and a clear structure and novel purpose; an intermediated model that preserves the direct relationship between consumers and financial institutions; and sufficiently mitigate the acute risk of deposit substitution and its cascading effects on the financial system.
CUNA also expresses credit union support for the “whole-of-government” approach outlined in President Biden’s executive order to ensure appropriate oversight and regulation of the marketplace and to prevent regulatory arbitrage by fintechs and other unregulated entities providing financial services.