Blockchain Regulatory Sandbox Launched By US Consumer Financial Protection Bureau

Blockchain, FinTech, News | July 20, 2018 By:

Mick Mulvaney, acting head of the US Consumer Financial Protection Bureau (CFPB), has announced that the bureau is launching a regulatory sandbox to encourage financial technology (FinTech) innovation, including blockchain.

The regulatory sandbox will be led by Paul Watkins, who was recently appointed by Mulvaney as head of the CFPB’s newly created Office of Innovation. The new office will focus on creating policies to facilitate innovation, engaging with entrepreneurs and regulators, and reviewing outdated or unnecessary regulations. Watkins previously oversaw FinTech initiatives for the office of the attorney general of Arizona, including a regulatory sandbox.

“I am delighted that Paul Watkins is bringing his deep expertise, track record of protecting consumers, and commitment to innovation to the bureau,” Mulvaney said in a statement. “I am confident that, under his leadership, the Office of Innovation will make significant progress in creating an environment where companies can advance new products and services without being unduly restricted by red tape that belongs in the 20th century.”

Mulvaney said the new Office of Innovation will be spearheading the regulatory sandbox and will examine blockchain technology and cryptocurrencies, as well as peer-to-peer lending and private currencies. The goal of the sandbox is to help blockchain and FinTech startups develop and test new products and services.

“You can make a strong argument … that new technology actually offers new and innovative ways to protect consumers, said Mulvaney. “You are moving light years beyond the complaint hotline to where you can really see things happening in real time.”

Mulvaney has already supported blockchain technology in the past. In September 2016, Mulvaney, along with Representative Jared Polis (D-CO), created the bipartisan Congressional Blockchain Caucus dedicated to the advancement of sound public policy toward cryptocurrencies and other blockchain technologies.