Powell Confirms Banks Can Serve Crypto Industry

Jerome Powell announced on June 24, 2025, that U.S. banks can freely provide services to the crypto industry during his congressional testimony.

Jerome Powell’s announcement signifies a significant regulatory shift allowing banks to deepen their involvement in the cryptocurrency sector.

Federal Reserve’s New Stance

Jerome Powell, Chair of the Federal Reserve, reiterated in his congressional testimony that U.S. banks are “free to provide banking services to the crypto industry.” The policy update clarifies the bank’s stance on crypto involvement, eliminating regulatory uncertainties.

Powell’s statement emphasizes that there are no regulatory barriers from the Fed preventing banks from extending services to cryptocurrency firms. This move is expected to ease tensions and pave the way for expanded crypto-market adoption.

Implications for Institutional Adoption

The announcement is expected to facilitate deeper institutional adoption of crypto services. It removes obstacles for traditional banks, allowing them to allocate resources towards this growing sector. Digital asset collaborations will likely see an upswing.

The decision possibly impacts the financial sector, encouraging banks to form partnerships with fintech firms. Institutional involvement can accelerate innovations in the crypto ecosystem, potentially unlocking new funding streams and enhancing market liquidity.

Historical Context and Future Outlook

Historically, favorable regulations increase institutional entry into crypto markets. This trend is anticipated to continue, particularly benefiting major cryptocurrencies like Bitcoin and Ethereum. The decision promotes a conducive environment for broader financial institutional adoption.

Regulatory shifts, akin to OCC’s past guidance, are likely to bolster the industry’s maturation. Previous similar stances led to increased capital inflows and market confidence. The potential for evolved banking relationships exists, suggesting imminent growth opportunities in this space.

This will encourage deeper institutional adoption of crypto services and potentially unlock new sources of funding and capital entry into the crypto markets.