Michael Barr, a former Ripple consultant, is being confirmed by the Senate to serve as the Vice Chairman for Supervision at the Federal Reserve. It will take on one of the most significant regulatory positions in the United States.
As the top banking watchdog in the United States, Barr, who served as a key Treasury Department official under former President Barack Obama, will get a voice in how the traditional financial system interacts with cryptocurrencies, particularly stablecoins, which are essential to cryptocurrency transactions.
Ex-Ripple Barr was nominated by Joe Biden in April
Barr was put forth by President Joe Biden in April for what may be the most important position in finance regulation. By a vote of 66 to 28 on Wednesday, the Senate approved his candidacy. Since the 2010 Dodd-Frank Act, the Fed also has a responsibility to monitor nonbank financial companies that play a significant role in the financial system.
The Fed oversees Wall Street banks. Even though Fed Chair Jerome Powell will technically be superior to him, the chairman has stated publicly that he will defer to the vice chair on matters relating to financial monitoring.
Barr will be able to make a significant contribution to international standard-setting bodies as well as the U.S. Financial Stability Oversight Council, which is debating how to handle stablecoins.
The council of agency heads can pressure member organizations like the Securities and Exchange Commission to regulate tokens if it formally classifies them as a systemically significant financial activity.
While Ripple is engaged in conflict with the SEC, Barr is poised to take over as the leader in financial regulation. Recently, the court rejected the SEC’s request for the attorney-client privilege in relation to a speech by William Hinman. Hinman served as the Division of Corporation Finance’s previous Director.