Feds will soon loosen tough stance on digital assets as Trump embraces crypto

The Federal Reserve and the Office of the Comptroller of the Currency – the nation’s top banking regulators — will soon loosen their tough stance when it comes to digital assets now that President Trump has fully embraced the industry, On The Money has learned.Officials at the nation’s top banks, namely JP Morgan and Bank of America, are growing more optimistic that regulators will soften their long-held anti-crypto stance.They expect to be providing even basic services to crypto clients such as holding digital assets in custody, even buying bitcoin exchange-traded funds at their branches.The change in sentiment at the bank’s top overlords all began with President Trump’s courting of the $3.5 trillion crypto business and its top executives, and promising to end the Biden-era regulatory assault on the industry, Fox Business’s Eleanor Terrett reports. Trump put words into action earlier this month when his Securities and Exchange Commission reversed Biden’s strict accounting guidance that made it difficult for banks to keep custody of digital assets.The move could continue the ascension of  crypto price — including Bitcoin, the world’s most popular digital coin — already experiencing a significant post-election rally.

Bitcoin is up nearly 124% over the past year, trading at close to $100,000.“I expect banking regulators to get on board with the administration’s newfound approach to crypto and we will see banks enter the space at a rapid pace,” Mike Lempres, former chairman of the now defunct Silvergate Capital Corporation, and a consultant to crypto companies, told Terrett.  Silvergate voluntarily liquidated in 2023 because the regulatory requirements were too onerous following FTX. “Blockchain technology can lead to a dramatic increase in banks’ ability to service customers and to comply with Bank Secrecy Act rules,” Lempres added.Both the Fed and the OCC, an arm of the Treasury Department, are semi-independent regulators of t...