As Prepared for Delivery on July 22, 2021
Thank you for today’s presentation. I’ll begin with an anecdote: a few months ago, I spoke with the president of a financial institution in Charlottesville, Virginia. Earlier this year, they started providing Bitcoin access at their branch locations and ATMs. That is not exactly something you expect to hear from a small financial institution.
But their customers had expressed interest in cryptocurrency, and so they decided to experiment with Bitcoin to gauge the response. As he put it, they wanted to prove that smaller institutions could be just as innovative as the big national players.
Now, time will tell how this plays out. And for now, we should view Bitcoin as an experiment in customer service until we have more data. But I’m impressed that this small institution is taking such a forward-leaning approach because that’s an important part of being competitive in today’s marketplace.
Now, let me pause to clarify, I am not saying that credit unions should rush into Bitcoin. But I am encouraging credit unions to look carefully at technological tools – whether it’s cryptocurrencies, or digital payment platforms, or blockchain applications, financial data aggregation – the list goes on and on – and think very hard about how they may, or may not, fit into your business models. I also want to publicly thank NCUA Vice Chairman Kyle Hauptman for leading on digital asset issues at the agency.
An undeniable challenge that credit unions face — and all financial services providers for that matter — is how to continue growing and prospering in a crowded marketplace. And one way to compete effectively, as this small institution in Virginia recognized, is by looking very closely at these fintech solutions and determining how they can be of value to your members.
It’s too often been the case that regulators have ended up behind the curve on confronting technological changes. I’m determined, along with my Board colleagues, to not let the NCUA get caught flat-footed by the rapidly changing technology marketplace.
As an agency, we are working to do more to focus on the regulatory and supervisory needs related to fintech. We recognize these technologies are going to play a growing role in financial services in the years to come, so we want to be prepared to ensure they’re effectively integrated with the needs of credit unions and credit unions’ member-owners.
In closing, I fully support using this RFI to either issue guidance or a rulemaking soon on digital assets. I have no questions.