CFTC Commissioner Christy Goldsmith Romero said at a crypto conference hosted by the International Swaps and Derivatives Association in New York that “Cryptocurrencies have not served as a hedge or to diversify traditional investment exposures,” and instead could “unexpectedly amplify risk, heightening financial stability concerns.” She called for regulators to “be careful in allowing bespoke treatment that could increase financial stability risks.”

Sens. Elizabeth Warren (D-MA) and Sheldon Whitehouse (D-RI) and Reps. Alexandria Ocasio-Cortez (D-NY), Rashida Tlaib (D-MI), and Chuy Garcia (D-IL) sent letters to the SEC, CFTC, Federal Reserve, FDIC, CFPB, and Treasury asking each agency to respond to a series of questions by November 7 about efforts to “stop the revolving door” between financial regulators and the cryptocurrency industry.

22 percent of the CFTC’s 82 enforcement actions in 2022 were related to cryptocurrency according to the agency’s annual enforcement report published on October 20.

Mastercard announced that it is creating a new program called Crypto Source to enable financial institutions to bring cryptocurrency trading capabilities and services to their customers. It is being launched in cooperation with Mastercard’s existing partner Paxos Trust Company and is expected to launch in Q4 of this year.

Sen. John Hickenlooper (D-CO) has sent a warning letter to SEC Chair Gary Gensler, marking the first time a Senate Democrat has publicly expressed concern about the SEC’s “regulation by enforcement.” In the letter, he said that the SEC needs to regulate crypto securities in “a transparent notice-and-comment regulatory process.” He specified that the SEC should take action to 1) define what types of digital assets are securities, 2) address listing and issuing digital securities, 3) determine necessary disclosure requirements, 4) establish a registration regime, and 5) set rules for trading and custody.

Sen. Elizabeth Warren (D-MA) is leading a group of Democratic lawmakers in pushing Texas officials for details regarding how cryptocurrency miners may be straining the state’s power grid, impacting climate change, and profiting from programs. In a letter, the group asked ERCOT, the Texas grid operator, for details on six years of miner electricity usage and carbon dioxide emissions. Other signatories to the letter are Sens. Sheldon Whitehouse and Ed Markey and Reps. Al Green, Katie Porter, and Jared Huffman.

The Financial Stability Board has released a report that calls for authorities to crack down on crypto conglomerates as part of nine draft policy recommendations for regulating the market. This recommendation says, “Authorities should ensure that crypto-asset service providers that combine multiple functions and activities, for example crypto-asset trading platforms, are subject to regulation, supervision and oversight that comprehensively address the risks associated with individual functions as well as the risks arising from the combination of functions, including requirements to separate certain functions and activities, as appropriate.” The FSB also updated its recommendations for oversight of stablecoins.

The Office of the Comptroller of the Currency released its bank supervision operating plan for the coming fiscal year. In it, third-party relationships, liquidity management, and climate risk are listed as areas of heightened focus. This partly aligns with previous concerns shared by Acting Comptroller Michael Hsu about the increasing complexity of bank-fintech partnerships related to digital banking. The plan says for partnerships with fintechs, OCC examiners should assess whether there is proper oversight of these relationships “commensurate with the risks posed.”

Last week Sens. Marsha Blackburn (R-TN) and Cynthia Lummis (R-WY) introduced S. 4985, a bill to amend the Cybersecurity Information Sharing Act of 2015 to include voluntary information sharing of cyber threat indicators among cryptocurrency companies. The bill was referred to the Senate Banking Committee. Separately, Sen. Bill Hagerty (R-TN), a member of the Senate Banking Committee, introduced a bill called the Digital Trading Clarity Act (S. 5030). It aims to provide regulatory clarity around the classification of digital assets and related liabilities in existing securities laws.