David Sacks: The FDIC's removal of "reputational risk" as a factor in bank regulation is a huge victory for crypto
ChainCatcher News, American cryptocurrency and artificial intelligence czar David Sacks stated: "This is a huge victory for cryptocurrency. The Federal Deposit Insurance Corporation (FDIC) will follow the Office of the Comptroller of the Currency (OCC) in eliminating the practice of considering 'reputational risk' as a factor in bank regulation.
'Reputational risk' may sound good in theory, but it is defined as 'the likelihood that negative publicity regarding an institution's business practices (true or not) will cause a decline in the customer base, costly litigation, or a reduction in revenue.' In practice, this vague and subjective standard has been used to justify the elimination of legitimate crypto businesses through Operation Chokepoint 2.0. Banking standards should be objective and quantifiable, not based on the possibility of untrue stories. Thanks to Senator Tim Scott for his leadership in this area through the FIRM Act."