Michael Hsu, Head of the US Office of the Currency Controller (OCC), spoke about the Terra incident. While saying that the potential in crypto should not be overlooked, Hsu also underlined a careful and cautious approach.
Hsu spoke about the Terra event at the DC Blockchain Summit 2022. In his speech, he said that although Terra’s algorithmic stablecoin UST has deteriorated, there has been no contagion effect from the crypto market to traditional banking and finance. Hsu used the following statements on the subject:
“The resilience of the traditional banking system to recent events in crypto is not a coincidence. Rather, it is due, at least in part, to the continued and deliberate emphasis of federal bank regulators on safety, soundness and consumer protection.”
Hsu also added that the industry has suffered from the hype-based approach:
“But the industry has grown very quickly and the hype-based, ‘fire, ready, aim,’ the innovation and value creation ‘ approach is harmed. (…) Recent events in crypto should serve as a warning and an opportunity to reset and recalibrate the problems the industry is trying to solve.”
