U.S. President Donald Trump ordered the federal government to update its regulatory frameworks to integrate “digital assets and innovative technology into traditional financial services and payment systems” in an executive order signed Tuesday.
According to the document, the U.S. should foster financial technology services into its existing payment and financial services rails.
“It is therefore the policy of the United States to streamline regulatory processes, reduce unnecessary barriers to entry, and encourage collaboration between fintech firms, federally regulated financial institutions, and Federal financial regulators,” the order said.
The order directed the heads of financial regulators to review their existing rules over the next three months and identify any rules or documents “that unduly impede fintech firms from entering into partnerships with federally regulated institutions.”
Within six months, Trump directed regulators to “take steps to encourage innovation as a result of the review.”
These steps include asking the Federal Reserve Board of Governors to review how it allows uninsured depository institutions and non-bank financial firms access to payment accounts and services.
This review also asks the 12 Federal Reserve banks if they can act independently of the board to grant payment accounts.
This provision may specifically benefit Wyoming special purpose depository institutions and entities operating under a similar framework. The Federal Reserve Bank of Kansas already granted Kraken, a Wyoming SPDI, access to a limited version of its so-called master account earlier this year. Other companies have sought similar access.
The Federal Reserve is working on developing a more formal “skinny” master account, publishing a proposal last December to enable access for some firms.
This is the second executive order Trump signed Tuesday. Another one directs the Treasury Department and financial regulators to figure out how to strengthen the Bank Secrecy Act to block undocumented immigrants from having access to bank accounts or payment services.
This order directs the Treasury Department to consider “the strategic use of unregistered money services businesses, third-party payment processors, or peer-to-peer platforms to facilitate ‘off-the-books’ wage payments intended to bypass Bank Secrecy Act reporting thresholds or tax obligations,” among other platforms.