Fed’s Powell Endorses Bank Services for Crypto Companies

• Lyla Velez
• June 24, 2025
• Policy
• 0 Comments

Jerome Powell, Chair of the U.S. Federal Reserve, stated on October 6, 2025, that banks can now provide services to cryptocurrency firms in a secure manner.

The Federal Reserve’s decision could redefine U.S. banking’s role in digital assets, fostering broader financial innovations and liquidity.

Jerome Powell announced a regulatory shift permitting U.S. banks to engage with crypto firms if conducted safely. This move follows Powell’s consistent push for clearer digital asset regulations, marking a pivotal policy change. As Jerome Powell stated, “Banks in the U.S. are free to provide services to crypto companies and can also take part in crypto-related activities, if done safely and with proper protections for customers and the financial system.” Banks receiving permission indicates readiness to integrate financial systems with digital currencies, potentially boosting the legitimacy and accessibility of cryptocurrencies.

Immediate impacts include greater liquidity, easier fiat onboarding, and probable growth in stablecoin issuance. Fiat-backed assets and blockchain payment platforms might see increased usage. Regulatory actions have historically led to positive market responses, like post-2020’s OCC clarification on crypto custody, which resulted in higher crypto prices.

By promoting crypto firm bank relationships, Powell’s decision could enhance crypto’s stability and capital efficiency. Historical trends support potential rises in on-chain activity and institutional interest. Banks must still navigate complex regulatory frameworks, yet the announcement marks significant progress in cryptocurrency adoption.