- Lummis doubts Fed’s crypto guidance change, calling it “noise.”
- Fed still uses reputational risk and labels digital assets “unsafe.”
- She vows to hold Fed accountable for fair crypto treatment.
United States Senator Cynthia Lummis on April 25 expressed doubts about the excitement in the crypto industry over the recent move by the Federal Reserve.
On April 24, the Fed said it would retract a 2022 supervisory letter that discouraged banks from engaging with cryptocurrencies and stablecoins. While others in the cryptocurrency community support this as progress, she described it as “just noise” and not a true progression.
Lummis Questions Fed’s Actions
Lummis, a proponent of cryptocurrency who introduced the Bitcoin Strategic Reserve Bill in 2024, saw issues with Fed actions. She stated the Fed remains to be law breaking in its handling of bank master accounts and is still applying reputational risk when it supervises banks.
This occurs even while the Federal Insurance Deposit Corporation is developing a regulation to end including reputational risk in bank examinations, Bloomberg reports.
She further pointed out that the Fed’s policy under Section 9(13), where Bitcoin and digital assets have been labeled “unsafe and unsound,” still exists. She further remarked that numerous of the same individuals who were engaged in Operation Chokepoint 2.0, which she feels hurt crypto companies, continue to dictate crypto policies today.
Lummis commented,
We are NOT fooled. The Fed assassinated companies within the industry and hurt American interests by stifling innovation and shuttering businesses. This fight is far from over.”
Custodia Bank CEO Caitlin Long agreed with Lummis, thanking her for perceiving the circumstances clearly.
Some others in the crypto industry, such as Fideum’s Anastasija Plotnikova and MicroStrategy’s Michael Saylor, complimented the Fed’s action.
As stated by Saylor, it would make it possible for banks to support Bitcoin, while Anastasija Plotnikova, co founder and CEO of blockchain regulatory firm Fideum called it a step towards simpler institutional adoption of crypto.
Despite these views, Lummis is determined to keep the Fed accountable so that the digital asset industry is treated equally.
