Congress is considering legislation that would broaden and clarify the ability of U.S. banks and credit unions to hold digital assets, issue stablecoins and use blockchain technology, potentially bringing crypto infrastructure more directly inside the regulated banking system.
The proposals would establish clearer statutory treatment for activities that have previously depended heavily on guidance from individual banking regulators, including digital-asset custody and participation in blockchain-based financial networks.
The effort comes as lawmakers work through a wider digital-asset legislative agenda following enactment of federal payment-stablecoin rules and continuing negotiations over crypto market structure.
Rather than deregulating banks’ crypto businesses entirely, the emerging framework would generally establish which activities regulated institutions can conduct while leaving prudential requirements — including capital, liquidity, cybersecurity and risk management — with existing banking supervisors.
That distinction is important: congressional authorization to conduct an activity would not mean banks could undertake it without regulatory safeguards.
Banks Could Hold Crypto and Use Blockchains
One major objective is to clarify that regulated depository institutions can provide digital-asset custody.
Banks already safeguard securities, cash and other customer assets, and crypto advocates have long argued that custody of tokenized assets should fall within the same basic banking authority when appropriate controls are in place.
Legislation could reduce uncertainty created by changing regulatory interpretations over whether banks need separate approvals before offering crypto-related services.
Blockchain infrastructure is another focus.
Banks could potentially use distributed ledgers to transfer deposits, settle transactions, manage tokenized securities and communicate with other financial institutions, provided those activities comply with existing banking and financial-crime rules.
That would place blockchain alongside other technologies banks can use to provide otherwise permissible financial services rather than treating the technology itself as a prohibited activity.
Federal banking regulators have already moved substantially in that direction. The Office of the Comptroller of the Currency has reaffirmed that national banks may conduct certain crypto custody, stablecoin and distributed-ledger activities, while the Federal Reserve and Federal Deposit Insurance Corporation have withdrawn or modified earlier supervisory approaches that imposed additional barriers.
Congressional legislation could make those permissions more durable by embedding them in statute.
Stablecoins Bring Banks and Credit Unions Into Focus
Stablecoins are particularly significant because they sit at the intersection of crypto markets and conventional banking.
Federal stablecoin legislation has established a framework under which qualifying institutions can issue dollar-backed payment tokens subject to reserve, redemption and supervisory requirements.
Additional congressional proposals would clarify how those rules interact with banks and federally insured credit unions, including their ability to issue stablecoins or participate in the infrastructure supporting them.
The policy debate is increasingly shifting from whether regulated financial institutions should interact with blockchain technology to how those activities should be supervised.
Banks potentially bring established compliance systems and direct access to conventional payment infrastructure. Crypto-native companies, meanwhile, argue that rules should not create structural advantages allowing banks to dominate stablecoin issuance or digital-asset services.
Consumer protection is another consideration.
Holding cryptocurrency through a bank does not automatically make the asset equivalent to an insured bank deposit. Deposit insurance generally protects qualifying deposits within statutory limits, not every asset that a financial institution may custody for customers.
Similarly, a bank-issued stablecoin remains legally and economically distinct from an ordinary checking-account balance unless legislation explicitly provides otherwise.
The congressional proposals therefore could materially broaden the role of regulated financial institutions in digital assets without eliminating the distinctions between deposits, stablecoins and custodial crypto holdings.
If enacted, the changes would represent another stage in the integration of crypto with U.S. finance.
The first phase largely involved banks providing services to cryptocurrency companies. The emerging framework goes further by contemplating banks and credit unions themselves holding digital assets, issuing blockchain-based dollars and using distributed ledgers as part of ordinary financial infrastructure.