- Federal Reserve enables banks to conduct cryptocurrency activities.
- Jerome Powell highlights industry’s maturity and reduced risks.
- Significant market response with increased Bitcoin ETF inflows.
Federal Reserve Chair Jerome Powell announced on June 24-25, 2025, that U.S. banks can conduct cryptocurrency activities, given adherence to safety protocols, during a congressional testimony.
Powell’s policy shift signals potential for increased institutional crypto engagement, with Bitcoin prices surging and substantial ETF inflows following the announcement, marking a regulatory shift in financial markets.
The Federal Reserve Chair, Jerome Powell, announced a policy clarification allowing U.S. banks to conduct cryptocurrency services. He emphasized the need for rigorous risk management protocols to ensure safety. This marks a shift in U.S. regulatory policy.
U.S. banks are now empowered to offer services to the cryptocurrency sector under strict guidelines. Powell’s testimony in Congress highlighted that the industry is maturing, stating:
“I think what’s happening is the industry is maturing, our understanding of it is improving, and in a sense, it’s becoming much more mainstream” – source
Powell’s statements led to a strong market response, with institutions investing over $588 million in Bitcoin ETFs. Additionally, around $71 million entered Ethereum ETFs.
The market saw Bitcoin prices surge past $105,000, reflecting heightened investor confidence.
The implications of Powell’s announcement extend to multiple sectors. Financial markets reacted briskly, as did political circles, with Senator Cynthia Lummis underlining the importance of regulatory evolution. Stablecoin legislation also appears poised for progress.
Historical advisories against crypto networks have previously constrained bank activities. This shift marks a departure from past restrictions, as discussed in the Federal Reserve’s Supervisory Policy Letter, indicating regulatory adaptation to the growing legitimacy of cryptocurrencies. This policy change affects Bitcoin, Ethereum, and other digital assets.
Potential outcomes include expanded crypto market participation by institutions and enhanced regulatory clarity, benefiting the financial sector. This could spur technological advances, with ripple effects on prices and investor sentiment as the market adjusts to these new opportunities.
| Disclaimer: The content on The CCPress is provided for informational purposes only and should not be considered financial or investment advice. Cryptocurrency investments carry inherent risks. Please consult a qualified financial advisor before making any investment decisions. |
