Lawmakers Weigh Stricter Crypto and Stablecoin Rules for Banks

Lawmakers in Congress are reportedly exploring the expansion of cryptocurrency regulations to grant banks and credit unions the authority to hold digital assets, issue stablecoins, and utilize blockchain technology. Insights from a recent CRS report indicate that policymakers are actively debating whether these digital asset and cryptocurrency functions should officially qualify as bank-permissible activities.

The findings suggest that passing new legislation would establish a lasting framework, thereby minimizing the frequency of regulatory shifts. Additionally, Congress is weighing whether a permanent legislative solution—either enabling or restricting crypto operations—is the most advantageous path forward. Historically, lawmakers overseeing banking maintained that institutions could only engage in crypto-related services if those functions were legally authorized and executed safely and soundly. Yet, this stance has evolved recently alongside the rise of the second Trump administration and the expanding mainstream adoption of digital currencies.

With the U.S. Senate continuing discussions on regulatory clarity, the integration of digital assets into conventional banking remains a prominent issue. The SEC has already committed to formulating clearer guidelines and new digital asset frameworks tailored for banking institutions. Meanwhile, the passage of the GENIUS Act earlier this summer authorized bank-owned enterprises to engage in stablecoin issuance, custody services, and related operations.

Regardless of whether a given administration aims to broaden or restrict financial institutions’ involvement in the digital asset sector, the report cautions that existing regulatory standards remain susceptible to being overturned without direct congressional intervention. Moreover, adopting a permissive approach would introduce important questions concerning liquidity, capital requirements, exposure to market volatility, and compliance with anti-money-laundering protocols.

Frequently Asked Questions

What changes are lawmakers considering for banks and credit unions?

Congress is reviewing potential rules that would permit banks and credit unions to issue stablecoins, hold digital assets, and integrate blockchain technology into their operations.

Why is new legislation recommended over administrative rules?

According to the Congressional Research Service, formal legislation creates a more permanent outcome that reduces the chance of frequent regulatory reversals.

What previous legislation has already impacted stablecoins?

The GENIUS Act, passed earlier in the summer, already permitted bank-owned businesses to handle stablecoin custody, issuance, and related activities.