Federal Reserve Chairman Jerome Powell told Senators in Washington D.C. he believes the crypto industry is maturing.
US Fed Chair Powell Says Crypto is “Maturing”; Hints at Easing of Bank Restrictions
26 June 2025 - 13:51 CEST
Testifying before the Senate Banking Committee on 25 June, Chair Powell noted that the sector has become much more widely recognized and adopted. He added that banks should have greater flexibility to engage with cryptocurrencies, if regulations ensure security, in light of previous malpractices.
Past failures
“What has changed is that if you go back, that’s a couple of years ago, that was a period of high-profile failures and fraud,” Powell said. “What has happened is that the industry is maturing, our understanding of it is improving, and, in a sense, it’s becoming much more mainstream.”
Chair Powell’s comments came in response to a question from Cynthia Lummis, a Republican who has been dubbed the “Bitcoin Senator” for her strong support of digital assets.
Fed policy
Senator Lummis questioned Powell on what developments had altered the risk landscape for stablecoins since the Federal Reserve’s 2023 policy issued under Section 9(13). She further asked if the Fed had any plans to rescind this regulation, which grants the Fed authority to regulate the activities of state member banks. The guidance effectively restricted these banks from holding or transacting in certain crypto assets, particularly stablecoins, without prior approval.
Crypto price reactions were mixed. By 12:00 EST / 16:00 UTC on 25 June Bitcoin jumped after hearing the news, rising +1.71% to $107,098.88 while ETH and SOL both saw declines.
Revisiting Biden era
Powell further noted that the Fed was moving away from the previous regulatory stance of the Biden administration, noting: “All of us are revisiting the things that were done during that era.”
Signaling that the Fed may soon ease regulations restricting bank stablecoin and digital asset holdings, he said: “It’s appropriate, it’s always been appropriate for banks to choose their customers and to be able to undertake activities as long as they’re safe and sound.”
A new approach?
The US Federal Reserve, while somewhat independent from the rest of the federal bureaucracy, now joins a growing list of central banks and regulators that are easing or revisiting their approach towards crypto.
For banks, investors and crypto watchers, the era of blanket skepticism may be giving way to nuanced regulation that will prioritize oversight and rulemaking that ensures security while not inhibiting innovation and growth.
