Fed’s Michelle Bowman warns US banks to adopt blockchain or risk irrelevance

Financial technology goes forward and banks and regulators must follow or cope with the decline.

Financial innovation is not optional, said a vice-president of the Fed. On Tuesday, August 19, the vice-president of the Federal Reserve for supervision Michelle W. Bowman held a speech At the annual Wyoming Blockchain symposium.

Bowman addressed the growing role of blockchain and AI in the American banking system. Banks already use blockchain networks authorized in their interban or interbank operations. At the same time, tokenized assets allow real asset transfers to be much more effective.

However, the Fed and the banks are too cautious when it comes to adopting new technologies. According to Bowman, part of this is due to the risk of reputation, which played a key role in the controversialWhere banks would have refused services to legal companies that did not line up on the political objectives of the dominant current.

“Let me be clear. We have to adopt an approach that does not penalize or pre -order a bank to bance a client engaged in legal activities. This approach must allow and encourage banks to provide banking products and services to any legal company, without disadvantage points of view, companies or specific industries, “said Bowman.

Fed and banks must follow technology: Bowman

According to Bowman, regulators play a key role in defining the pace of adoption of new technologies. Ideally, she said, they should adopt technologies that largely benefit the banking system.

“If it is not our approach, then we risk that the banking system becomes less relevant for consumers, businesses and the overall economy. Consequently, banks will play a reduced role in the financial system more broadly,” said Bowman.