Banks Warn About Crypto Before Coronavirus Testimony Before the U.S. Senate

The Bitcoin Price Dip

Major Wall Street bank executives will arrive before the United States Senate Banking Committee on Wednesday. They will consider the role of their financial institutions in the improvement of the American economy.

Democratic lawmakers intend to grill several major bank execs whose firms recognized record profits throughout the coronavirus epidemic. At the same time, average Americans fought to make ends meet.

In prepared statements posted on Tuesday, CEOs at the Bank of America, Citigroup, and Wells Fargo explained their respective banks’ replies to significant challenges. Those include inequality, diversity, climate change, taxes, and how their banks manage cryptocurrencies.

Crypto Bull Run

This year marked a record bull run in cryptocurrency markets as major financial institutions opened up to digital assets. They started combining trading desks and custody wings to manage client engagements in significant cryptos like Bitcoin (BTC).

In his statement, Bank of America CEO Brian Moynihan asserted that the bank is proceeding to assess the benefits, risks, and client demand for crypto-related products and services.

Currently, the bank does not lend against cryptocurrencies. It does not affect bank companies whose primary business is a cryptocurrency or the facilitation of cryptocurrency trading and investment.

Moynihan stated that BofA is also assessing new technologies like shared ledger technology, potentially giving value to the bank’s customers. Nevertheless, while BofA holds over 60 blockchain patents, the bank has not yet found a use case at scale, Moynihan declared.

Furthermore, Citigroup CEO Jane Fraser also described measured access to crypto. He stated that the bank will guarantee straightforward controls and governance before joining cryptocurrencies.

Fraser wrote that Citi is concentrating resources and efforts to recognize changes in the digital asset space. Moreover, they focus on the application of distributed ledger technology, including demand and interest by their clients, regulatory developments, and technology advancements.

Wells Fargo CEO and president Charles Scharf stated that the company had been closely watching developments around cryptocurrencies. Digital assets have developed as alternative investment products through their status as a currency. Furthermore, the mechanism of payment persists fluid, Scharf recorded.

The exec also stated that Wells Fargo plans to roll out a pilot for a blockchain-based settlement service in the bank’s global branch network.

The Senate Banking and House Financial Services committees will also gather from JPMorgan, Goldman Sachs, and Morgan Stanley CEOs. The latter included limited crypto services earlier this year, while the former reportedly reflected a crypto trading desk.

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