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The US Government Accountability Office has urged the Federal Deposit Insurance Corporation to make an effort to coordinate with other federal agencies to address risks from blockchain technology.<\/p>\n
GAO made a June 8 letter<\/a> to FDIC Chairman Travis Hill public on Monday, which said that it first flagged priority recommendations with the regulator in May last year, including addressing blockchain technology risks.<\/p>\n It said that blockchain technology was an area of concern that it put on its \u201cHigh Risk List,\u201d as it deems that regulators have struggled to oversee blockchain-based financial products and the risks they could pose to US markets.<\/p>\n Under the GENIUS Act passed last year, the FDIC is the main regulator for stablecoin issuers that are subsidiaries of the banks it supervises. Senate lawmakers are currently looking to pass a bill<\/a> that would outline how federal agencies would regulate the wider crypto market.<\/p>\n Source: <\/em>U.S. GAO<\/em><\/a><\/p>\n In its letter to Hill, the GAO said that it found in 2023 that financial regulators \u201clacked an ongoing coordination mechanism for addressing blockchain risks\u201d and in the meantime, \u201cblockchain-related financial products and services have grown substantially.\u201d<\/p>\n \u201cEstablishing such a mechanism, as we recommended, would help FDIC and other regulators collectively identify risks and develop and implement a regulatory response in a timely manner,\u201d it added.<\/p>\n The GAO also urged that the FDIC rotate case managers assigned to banks to strengthen supervision of the sector.<\/p>\n