Jerome Powell Says Banks Can Offer Crypto Services Under New Guidelines

Jerome Powell stated that U.S. banks may legally offer crypto services if operated under safe, sound, and regulated frameworks.

Powell expressed support for the GENIUS Act and called for a stablecoin framework to strengthen crypto regulation in the financial sector.

Regulatory tone has shifted positively as Powell emphasized crypto’s growing mainstream presence and the need for modernized banking policies.

Federal Reserve Chairman Jerome Powell once again supported regulated crypto services in two important congress hearings, showing the changing position of the digital asset sector.

Powell: Banks Are Free to Engage in Crypto Activities

During his appearance before the House Financial Services Committee, Powell stated that “banks are free to provide banking services to the crypto industry and to conduct crypto activities.” He clarified that institutions can pursue such services, provided operations remain “safe and sound.”

Powell also confirmed that the Federal Reserve is reviewing and withdrawing several crypto-related guidance statements issued during the Biden administration. His remarks reflected a broader shift in policy tone, highlighting that “it’s always been appropriate for banks to choose their customers and to be able to undertake activities.”

On Wednesday, Powell reiterated similar views before the Senate Banking Committee. Responding to a question from Senator Cynthia Lummis, he said, “The industry is maturing, our understanding of it is improving… it’s becoming much more mainstream.”

Legislative Frameworks Move Through Congress

Powell expressed support for pending crypto legislation, describing ongoing efforts as a “great thing.” He remarked, “We need a stablecoin framework,” pointing to the importance of regulatory clarity as the industry continues to evolve.

He also supported a newly approved GENIUS Act, which introduces transparent regulations of stablecoin issuing and trading. The act allows banks to serve stablecoin holders under proper risk controls. Powell indicated that such legislation would provide essential structure to an expanding financial segment.

The Senate initiative coincides with a Republican-led framework released this week aimed at shaping crypto market structure legislation. The principles align closely with the House-approved CLARITY Act, which has advanced through committee but awaits a full chamber vote.

Changing Tone Reflects Industry Maturity

Powell acknowledged a shift in perception, noting a “very significant change in the tone” toward crypto. He attributed this to both regulatory progress and industry development.

His key point is that banks have a chance to do crypto in a responsible way, and once again he stressed that these activities should be focused on safety first. The stance by Powell is a significant change of the previous form of caution and further indicates that the digital assets have managed to enter the financial mainstream.

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