Federal Reserve’s Powell Urges Rethink on Bank Discontinuation Amid Crypto Service Exclusions

In a significant development for the crypto sector, Federal Reserve Chair Jerome Powell emphasized the need to reevaluate the impacts of bank discontinuation on the industry. His remarks came during a Senate Banking Committee hearing, where he acknowledged concerns regarding the existing banking landscape’s treatment of cryptocurrency firms. Senator Tim Scott (R-S.C.) questioned Powell about potential regulatory reforms to avoid imposing unnecessary burdens on financial institutions. Powell affirmed his commitment to collaborate with officials to ensure that regulations support innovation rather than stifle it. “It’s vital that we revisit this matter of bank discontinuation,” he noted, reinforcing the Fed’s intent to strike a balance in oversight. This dialogue illustrates a growing willingness among regulatory bodies to engage with the fast-evolving cryptocurrency market to foster a more inclusive banking environment.