Congress Tackles Crypto Rules for Banks and Credit Unions

Congress is considering legislation that would expand and clarify the ability of U.S. banks and credit unions to hold digital assets, issue stablecoins, and use blockchain technology.

The proposals aim to establish clearer statutory treatment for activities that have previously depended heavily on guidance from individual banking regulators, including digital-asset custody and participation in blockchain-based financial networks.

Banks could potentially use distributed ledgers to transfer deposits, settle transactions, manage tokenized securities, and communicate with other financial institutions, provided those activities comply with existing banking and financial-crime rules.

The legislation would generally establish which activities regulated institutions can conduct while leaving prudential requirements, including capital, liquidity, cybersecurity, and risk management, with existing banking supervisors.