At the Senate hearing, Sherrod Brown, the committee’s chairman, has promised to press the bank chiefs on a range of subjects, sending them a list of questions on topics including the riskiness of their assets, the diversity of their work forces, actions on climate change, pledges on racial equity and more. It could make for a disjointed hearing as senators veer from issue to issue, trying to catch the C.E.O.s off guard or unprepared.
The bankers submitted their homework. Their prepared testimonies address the committee’s questions in varying depth and detail, while all make the case that their institutions are healthier, safer and more law-abiding since 2008.
Jamie Dimon of JPMorgan Chase turned in a nine-page paper urging business, government and society to address inequities and “unleash the extraordinary vibrancy of the American economy.”
Jane Fraser of Citigroup prepared 11 pages (and a three-page addendum with data and tables) that note her bank’s approach to cryptocurrencies, saying that it is “focusing resources and efforts to understand changes in the digital asset space.”
James Gorman of Morgan Stanley assembled a 20-page report with few frills that includes a short introduction and responses to each question in order.
Brian Moynihan of Bank of America had the most to say, with 32 pages that devote a lot of space to the bank’s “responsible growth” principles. “We embrace our dual responsibility to drive both profits and purpose,” he wrote.
Elsewhere on Capitol Hill, the S.E.C. chairman, Gary Gensler, will testify today before a House committee, where he is expected to address SPACs, cryptocurrency and other hot-button issues.
A senator’s laser-eyed focus on new rules for crypto
The Republican senator Cynthia Lummis of Wyoming owns some Bitcoin and is one of Congress’s most vocal crypto champions. (For a time, her Twitter profile picture showed laser beams shooting from her eyes, a meme adopted by crypto bulls.) Yesterday, she started the bipartisan Financial Innovation Caucus to help create legislation for the blockchain era. DealBook asked her about this moment in crypto and what’s ahead for regulation. The interview has been edited and condensed for clarity.
What does the recent market volatility mean for regulation?
Many market excesses, including certain leverage and lending practices, are currently being flushed out. This puts digital asset markets on a more sustainable path, at precisely the moment regulators are deciding that these assets and financial innovation are here to stay. Right-sized regulation has the potential to bring more certainty and consumer protection to digital asset markets, while increasing adoption.
What happens in the meantime? The crypto market keeps getting bigger.
Digital assets are already mainstream — all of the major Wall Street banks have teams working on fintech and digital asset product offerings that we’ll see over the next year. Market adoption is already here and the existing volatility in the market is simply growing pains. Digital assets are not meant for soft hands at the moment (that’s the one thing Elon Musk got right over the last couple weeks, with his “diamond hands” tweet).
Where will the caucus start?
With education. These are very complicated topics that deserve the attention of every senator and member of Congress. Moving beyond that, our first priority must be to provide legal clarity and to ensure financial technology is normalized within our financial system.