In a landmark speech at the Chicago Economic Club on April 17, 2025, Federal Reserve Chair Jerome Powell delivered a pivotal message to the cryptocurrency industry: while no immediate rate cuts were announced, the door to regulatory evolution is now wide open. Powell acknowledged the growing mainstream adoption of digital assets and emphasized that current banking regulations around cryptocurrency “have room for relaxation.” Most significantly, he called for a clear regulatory framework for stablecoins—marking a turning point in U.S. financial policy and signaling strong support for innovation within a secure financial system.
This shift reflects broader momentum across U.S. financial institutions, particularly the Office of the Comptroller of the Currency (OCC), which has already taken decisive steps to integrate blockchain technology into traditional banking operations.
Changing Winds in Banking Regulation
Powell’s remarks underscore a notable pivot in regulatory philosophy. While past caution was rooted in high-profile crypto collapses and fraud incidents, he recognized that the market has matured. The landscape is no longer defined by volatility alone but by increasing institutional participation and improved risk management practices.
His acknowledgment that banking rules “have room for relaxation” aligns with recent actions by the OCC. On March 7, 2025, the agency released updated guidance that removes previous barriers, allowing national banks to offer crypto custody, hold stablecoin reserves, and participate as blockchain nodes—without requiring special approvals.
This marks a dramatic departure from earlier policies under the Biden administration, which mandated pre-approval for any bank engaging in crypto-related activities. The new stance treats digital assets as legitimate components of modern finance, effectively normalizing their role within the U.S. banking system.
OCC Embraces Innovation with New Crypto-Friendly Rules
As an independent bureau within the U.S. Department of the Treasury, the OCC oversees all national banks and federal savings associations. Historically conservative in its approach, the OCC under Acting Comptroller Hood has adopted a forward-looking posture aligned with the administration’s goal of making America a global leader in digital finance.
The March 2025 guidance revokes Interpretive Letter #1179 from 2021, which imposed strict limitations on banks’ involvement with cryptocurrencies. Now, national banks can:
- Provide secure cryptocurrency custody services, including private key management
- Hold reserves for dollar-pegged stablecoins at a 1:1 ratio
- Operate as blockchain validators or nodes, supporting decentralized network integrity
These changes eliminate redundant hurdles and affirm that digital assets are not only permissible but essential to the future of American finance.
“Digital assets should and must be part of the U.S. economy,” stated Acting Comptroller Hood. “My priority is building a regulatory framework that fosters innovation while safeguarding the safety, soundness, and fairness of our banking system.”
Accelerating Integration Between Banking and Blockchain
The OCC’s updated position signals growing confidence in banks’ ability to manage crypto-related risks. With more robust compliance tools, anti-money laundering (AML) protocols, and cybersecurity measures now standard, regulators see less need for blanket restrictions.
This transformation coincides with President Trump’s public commitment to ending policies that exclude crypto firms from banking services. At the first-ever White House Crypto Summit in March 2025, he declared: “Last year I promised to make America the Bitcoin superpower and global capital of crypto—today we’re taking historic action to fulfill that promise.”
While challenges remain—particularly with the Federal Reserve and FDIC yet to clarify their stances—the OCC’s leadership sets a powerful precedent. By streamlining access and affirming digital assets as valid financial instruments, the U.S. is laying the foundation for widespread adoption.
Some bankers worry that stablecoins could erode traditional deposits and weaken lending capacity. However, clearer regulation may attract major players like Bank of America. CEO Brian Moynihan recently stated the bank would launch its own stablecoin once legislation passes.
Stablecoin Regulation Gains Momentum
One of the most critical developments highlighted by Powell is the urgent need for a legal framework governing stablecoins—digital currencies pegged to fiat assets like the U.S. dollar.
“Cryptocurrencies are becoming mainstream,” Powell said. “Establishing a legal framework for stablecoins is a good idea. They could have broad appeal, and we must include consumer protections.”
Congress is responding swiftly. On April 3, 2025, the House Financial Services Committee passed the Stablecoin Transparency, Accountability, and Base Expectations Act (STABLE Act) by a vote of 32–17. Sponsored by Representatives French Hill and Bryan Steil, this bill defines stablecoins strictly as payment tools, prohibits interest-bearing models, and mandates full reserve backing.
Meanwhile, in the Senate, the Generational Innovation in National Digital Currency Leadership and Security Act (GENIUS Act) cleared the Banking Committee on March 13 with an 18–6 vote. Championed by Chairman Tim Scott, it requires 1:1 reserves, enforces AML compliance, and aims to create “common-sense rules” that protect consumers while strengthening the dollar’s global dominance.
Scott aims to pass the bill before Trump’s 100th day in office—April 30, 2025—though Democratic support will be crucial due to the 60-vote threshold.
👉 Learn how upcoming stablecoin laws could reshape global payments and digital finance infrastructure.
Regulatory Clarity Meets Market Realities
On April 5, the SEC issued new guidance confirming that certain stablecoins do not qualify as securities and are exempt from transaction reporting requirements. However, this likely excludes major players like Tether (USDT), whose reserves include precious metals and other crypto assets—disallowed under SEC rules. Additionally, Tether’s potential delays or minimum thresholds for redemption may conflict with the SEC’s “immediate convertibility” standard.
Despite progress,分歧 persists between chambers. Key issues include whether algorithmic stablecoins should be regulated and how federal versus state authority should be balanced. Industry experts predict a merged STABLE GENIUS Act could reach a final vote within 2–3 months.
Treasury Secretary Scott Besent reinforced this trajectory during a speech at the American Bankers Association conference on April 9: “We are carefully reviewing regulatory barriers around blockchain, stablecoins, and next-generation payment systems—and considering reforms that unlock America’s capital market potential.”
Navigating Geopolitical Headwinds: The Impact of Tariffs
Beyond regulation, macroeconomic forces are shaping crypto’s evolution. Powell warned that recent tariff policies “may have larger-than-expected economic impacts,” potentially driving inflation higher and slowing growth.
While cryptocurrencies were designed to operate independently of government control, they’re not immune to global trade dynamics. After new tariffs were announced on April 2, Bitcoin dropped only 10%—significantly less than the S&P 500’s implied 36% decline based on historical correlation. This suggests Bitcoin may offer portfolio diversification benefits even during broad market sell-offs.
Tariffs also raise mining costs—especially for PoW coins like Bitcoin—by increasing prices on semiconductor chips and mining hardware largely sourced from China. This could force miners to relocate or downsize operations, affecting network security.
Furthermore:
- A stronger dollar from short-term tariff effects may pressure crypto prices
- Currency devaluations in vulnerable economies (e.g., Argentina, Turkey) could boost demand for stablecoins as hedges
- Long-term inflation fears might enhance Bitcoin’s appeal as “digital gold”
- Trade tensions may trigger tighter financial oversight, increasing market uncertainty
Gary Gensler’s Perspective: Emotion vs. Fundamentals
In a recent CNBC appearance, former SEC Chair Gary Gensler offered nuanced insights into crypto’s future. While acknowledging Bitcoin’s staying power—“7 billion people are interested; it may last a long time”—he cautioned that 99% of crypto trading is emotion-driven.
He predicted that meme coins and speculative tokens (numbering between 10,000–15,000) would lose relevance over time. Only assets with real utility or strong fundamentals, he argued, will endure as markets mature.
Frequently Asked Questions (FAQ)
Q: What did Powell say about cryptocurrency regulation?
A: Powell stated that current banking rules around crypto “have room for relaxation” and emphasized the need for a clear regulatory framework for stablecoins—signaling support for innovation within a secure financial system.
Q: Can U.S. banks now offer crypto services?
A: Yes. Under new OCC guidance issued in March 2025, national banks can provide crypto custody, hold stablecoin reserves, and operate blockchain nodes without special approval.
Q: Are stablecoins considered securities?
A: The SEC recently clarified that some dollar-backed stablecoins are not securities if they meet strict criteria—including full reserve backing and immediate USD convertibility.
Q: How might tariffs affect Bitcoin mining?
A: Tariffs on imported semiconductors and hardware can increase mining costs, especially for ASIC-dependent operations relying on Chinese-made equipment, potentially reshaping global mining geography.
Q: Will stablecoin legislation pass in 2025?
A: With strong bipartisan momentum and White House backing, experts believe a consolidated stablecoin bill could pass by late summer 2025—making it a potential watershed year for digital payments.
Q: Is Bitcoin truly resistant to macroeconomic shocks?
A: While not immune, Bitcoin has shown resilience during market downturns—falling less than traditional indices—suggesting growing recognition as a diversifier or hedge against systemic risks.