Fintech businesses struggling to stay inbounds of government rules may soon receive a dose of much-needed guidance via the Consumer Financial Protection Bureau (CFPB). Through its newly-created Office of Innovation, agency leadership intends to develop a regulatory framework designed to open the spigot in terms of the development of new products and services for those companies involved in cryptocurrencies, blockchain technologies and microlending, and also loans by individuals. Paul Watkins, the architect of Arizona’s fintech regulatory sandbox that launches in August, was named to spearhead the federal effort.“It’s a good first step,” Washington D.C.-based finance and regulatory attorney Laurel Loomis Rimon told Bitcoin Magazine. Rimon, senior counsel with the global law firm O’Melveny and former lawyer with various government agencies — including a stint as CFPB assistant deputy enforcement director — said entrepreneurs and startup companies in the fintech space “operate with a lot of uncertainty.” For these financial innovators, ensuring universal compliance within the vast span of regulatory agencies “all come with a pretty heavy investment.” Combined with the hefty outlay of cash involved, especially in the early stages of startups, the lack of regulatory guidance “leaves them really unsure of how to spend their money.”Theoretically, then, the construction of a CFPB sandbox could alleviate some of...
