Fed’s Michelle Bowman Advocates Limited Crypto Ownership for Fed Staff

Fed’s Michelle Bowman Advocates Limited Crypto Ownership for Fed Staff

Michelle Bowman, Vice Chair for Supervision at the Federal Reserve, suggests allowing staff to hold small crypto holdings to boost regulatory expertise. This aligns with efforts to modernize Fed policy and follow the Trump administration’s crypto-friendly stance.

Bowman’s proposal signifies a shift towards a more technologically inclusive regulatory approach, potentially reshaping institutional engagement with digital assets.

Michelle Bowman emphasized the need for Fed staff to better understand digital assets by holding small amounts . At the Wyoming Blockchain Symposium, she argued this would align policy with technological innovation. “There’s no replacement for experimenting and understanding how that ownership and transfer process flows,” stated Bowman, highlighting the initiative’s importance. Historically cautious, Bowman now champions this initiative.

Bowman’s statements primarily impact BTC, ETH, and stablecoins. While there are no immediate financial changes, the proposal suggests a future regulatory shift. Under Bowman’s leadership, the Fed addresses stablecoin rules through initiatives like the GENIUS Act.

Immediate effects include a potential change in how banks and regulators view digital assets. Bowman’s stance may inspire increased institutional interest, although public blockchain data does not yet reflect these changes. The move aligns with a broader regulatory engagement trend.

Bowman’s advocacy contrasts previous Federal Reserve policies that restricted staff from holding crypto. Historically, similar regulatory openness, as seen in Switzerland and Singapore, has led to positive impacts on governance token utility and Layer 1/2 valuations.

The proposal could lead to deeper regulatory expertise in digital markets, affecting how banks and crypto firms interact. It reinforces the Fed’s commitment to transparent and efficient frameworks, encouraging cautious yet informed adoption of digital currencies within the financial system.