A coalition of financial services trade associations is urging the President’s Working Group on Digital Asset Markets to support the removal of obstacles that prevent financial institutions from participating in digital asset activities. The coalition includes several prominent bodies such as the Bank Policy Institute, American Bankers Association, American Fintech Council, Americas Focus Committee of the Association of Global Custodians, Financial Services Forum, Securities Industry and Financial Markets Association, and The Clearing House Association.
In a joint letter, the associations have acknowledged the progress made by the Federal Reserve, the FDIC, and the OCC in retracting policies that have previously impeded banks' involvement in digital asset activities. They suggested additional measures to further promote innovation within banks.
“The U.S. will not be able to achieve a leadership position in digital assets and financial technology under the status quo,” the letter states. “Banks are an essential component of the financial and payments systems and are governed by a comprehensive regulatory framework carefully crafted to mitigate the risks inherent to financial activities. It is therefore critical that the federal banking agencies take further steps to facilitate banks’ ability to engage in digital asset activities.”
The associations have outlined key recommendations:
1. Establish consistent rules across different agencies. Regulatory bodies should work together to create joint rules and guidance, or at least align policies to prevent conflicting requirements.
2. Regulate the activity, not the technology. Agencies should permit banks to engage in activities allowed by law, regardless of the technology involved, keeping the regulatory framework neutral to technology.
3. Define clear risk-management expectations. There should be uniform guidelines for managing risks associated with digital asset activities, including issues like anti-money laundering and capital risks, rather than requiring individual pre-approvals.
These recommendations are in line with the objectives of the President’s Executive Order on digital asset markets and follow a previous letter from February 2025. While progress has been made by banking agencies on some fronts, the associations continue to urge the Federal Reserve to update its Policy Statement on Section 9(13) of the Federal Reserve Act and to withdraw SR 23-7, “Creation of a Novel Activities Supervision Program.”
The Bank Policy Institute, which represents both U.S. and foreign banks within the country, among others, stands by these recommendations, pledging continued involvement in discussions around regulatory and security issues.
For more information, contacts from various associations, including Austin Anton (Bank Policy Institute), Sarah Grano (American Bankers Association), and others, have been provided for any inquiries.
To view the full letter, click [here].