Large U.S. banks are cautiously entering the encryption field, waiting for signals from regulatory agencies.

Gate News bot message, with strong support from regulators, major banks in the U.S. are internally discussing entering the Crypto Assets field, but according to four industry executives, the initial move will be exploratory, primarily focused on pilot projects, partnerships, or limited Crypto Assets trading.

Previously, due to strict regulations, Wall Street giants were essentially unable to engage in many Crypto Assets activities, but now they are preparing to rapidly develop taking advantage of favorable policies.

However, four executives stated that these banks are still unwilling to be the first among competitors to massively expand into the encryption field in order to avoid violating the constantly changing regulations. If a large company successfully expands, other companies will quickly follow suit, launching small-scale pilot projects and weighing other business prospects.

Large banks are seeking clearer anti-money laundering rules and regulatory guidelines before delving deeper into the field of Crypto Assets. They also seek consistent guidelines from banking and market regulators before launching new digital asset businesses.

Matthew Biben, Co-Head of the Global Financial Services Group at King & Spalding, stated: "Although the environment has greatly improved, banks will still be concerned about anti-money laundering and regulatory compliance issues."

A banking industry insider said that banks want to understand whether they can engage in Crypto Assets lending activities or if they are allowed to become market makers for digital assets. Two banking sources said that the cryptocurrency task force led by Trump-appointed "crypto czar" David Sacks does not have representatives from banking regulators, and that if large banks want to play any meaningful role in this business, personnel updates to this task force are needed.

Source: Reuters