TradFi coalition urges Trump to overhaul ‘restrictive’ Biden-era crypto policies
Leading financial industry groups have urged President Donald Trump’s administration to roll back federal policies they say have restricted US banks from engaging in digital asset markets and warned that regulatory overreach is hampering American leadership in financial innovation.
In a joint letter addressed to David Sacks – Special Advisor on Artificial Intelligence and Crypto and Chairman of the President’s Working Group on Digital Asset Markets – the groups demanded that federal banking policies adopted by the previous administration be immediately rescinded or revised.
According to the letter
“These policies have made it exceedingly difficult for banks to engage in digital asset-related activities, despite their clear legal authority to do so.”
They also pressed the White House to include key regulators — the Federal Reserve, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) — in the working group’s efforts to reshape the U.S. digital asset framework.
US banks are left out
The letter signed by Bank Policy Institute and American Bankers Association and Securities Industry and Financial Markets Association and other financial groups argued that US bank policies restricting digital asset trading have caused them to fall behind international competitors.
The banking organizations highlighted several regulatory actions taken under the Biden Administration, including:
- Federal Reserve’s SR22-6 policy On crypto-asset engagement
- OCC’s Interpretive letter 1179 Crypto custody restrictions
- FDIC FIL-16-2022 Notice requirement Crypto activities
- Joint agency statement warning of crypto-assets risks
The letter read:
“The United States will not be able to achieve a leadership position in digital assets and financial technology under the status quo.”
The banking groups stated that the first step to achieving this goal is to roll back the restrictions of the Biden era, which, they said had created uncertainty and discouraged US Financial Institutions from participating in the industry.
The organizations have indicated their intention to submit detailed legislative and regulation proposals in order to help US Banks regain competitiveness within the global digital asset market. The organizations also requested to meet with Sacks, the working group and discuss next steps.
Included in Crypto Task Force
They also asked Sacks to extend the President’s Working Group so that it would include banking regulators. Citing their influence on financial markets, they urged Sacks. FDIC, OCC and Federal Reserve are not part of the current taskforce despite being responsible for overseeing banks that want to use digital assets.
The letter referred to recent remarks by FDIC Acting Chair Travis Hill, who acknowledged that FDIC’s approach towards crypto led to the perception that it was “closed” for business in relation to blockchain and digital assets.
Beyond banking regulators, the groups suggested that the Financial Crimes Enforcement Network (FinCEN) and the Office of Foreign Assets Control (OFAC) — both divisions of the Treasury Department — should also be included in digital asset discussions, given their role in regulating financial crime and sanctions compliance.
