While the SEC-Ripple lawsuit is moving full steam ahead, ex-Ripple advisor, Michael Barr, is set to take the top spot in financial regulation. The Senate approved Barr to take the position of Vice Chairman for Supervision at the Federal Reserve.
Barr is the last of President Joe Biden’s three nominees to the Federal Reserve board. The Senate voted 66-28 to approve Barr’s position. He is a former Treasure official during ex-President Barak Obama’s tenure.
Following the terrible 2008 financial crisis, Barr worked as a Treasury official to help create the 2010 Dodd-Frank banking laws. His most recent position was dean of the Gerald R. Ford School of Public Policy at the University of Michigan.
However, the most striking experience is Barr’s crypto background. He served on the advisory board at Ripple labs.
While taking up the position at Ripple, Barr said,
“Innovation in payments can help make the financial system safer, reduce cost and improve access and efficiency for consumers and businesses alike.”
Ex-Ripple advisor in the Fed, a win for the crypto industry?
Regardless of Barr’s history with Ripple, the crypto industry might not fully benefit from this development. Barr is a known advocate for aggressive regulation; some have even accused him of favoring individuals over financial firms.
In 2020, Barr co-authored a paper citing research on crypto-assets such as Bitcoin (BTC). About which he said,
“not only generate huge mining costs, but are also inefficient in their long-run design.”
Another point of interest is that during his time in office, the Federal Reserve is expected to announce its decision on a digital Dollar. According to Barr’s scholarly work, a central bank digital currency (CBDC) might further the government’s goals for financial inclusion. A central bank digital currency is sure to have an impact on the crypto industry.
While Barr is set to take the top spot in financial regulation, Ripple is locked in battle with the SEC. The court has recently denied the SEC’s motion for attorney-client privilege regarding a speech made by William Hinman. Hinman is the former Director of the SEC’s Division of Corporation Finance. The Hinman speech is a pivotal piece of information in the lawsuit. In the speech made at the Yahoo Markets Summit, Hinman said that Ethereum had turned from a security to a non-security. This was when the SEC had not decided on how it would classify crypto assets.