A PYMNTS Company

Fed’s Bowman Pushes New Rules for Banks and Stablecoin Issuers

By  |  December 2, 2025

Federal Reserve Governor Michelle Bowman plans to signal to House lawmakers that the central bank is preparing new standards for both traditional lenders and stablecoin issuers, according to Bloomberg. Her comments are set to be delivered Tuesday during a House Financial Services Committee hearing focused on the evolving competition between banks, FinTech firms and cryptocurrency companies.

    Get the Full Story

    Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

    yesSubscribe to our daily newsletter, PYMNTS Today.

    By completing this form, you agree to receive marketing communications from PYMNTS and to the sharing of your information with our sponsor, if applicable, in accordance with our Privacy Policy and Terms and Conditions.

    Bowman, the Fed’s top banking supervisor, is expected to emphasize that regulators must foster innovation while keeping the financial system safe. “As a regulator, it is my role to encourage innovation in a responsible manner, and we must continuously improve our ability to supervise the risks to safety and soundness that innovation presents,” Bowman said in remarks prepared for the hearing. She noted that advances in technology could widen credit access and bring more balance between Wall Street institutions and newer digital finance players, per Bloomberg.

    As part of those efforts, Bowman intends to coordinate with other federal agencies to craft capital and diversification requirements for stablecoin issuers, as required by the Genius Act. The law calls for companies that issue these digital dollar-linked assets to register and hold full reserves in cash-equivalent dollars. According to Bloomberg, she also stressed that regulators will work to provide clearer guidance on how digital assets fit within existing oversight frameworks and will respond to proposals for new uses of crypto-related technologies.

    Related: South Korea’s Stablecoin Rules Stalled as Debate Over Issuer Control Intensifies

    Bowman’s message arrives as banks and crypto businesses push for regulatory changes that could determine who controls the future of digital finance. Crypto firms see bank charters as a way to gain legitimacy and access to the broader financial system. Traditional banks, however, have warned that granting such access too easily could weaken the charter system if firms receive the benefits of a banking license without fully embracing the associated obligations, according to Bloomberg.

    In addition to her commentary on digital assets, Bowman’s testimony is expected to address pending capital reforms for U.S. banks, including the long-debated Basel III Endgame rules. “My approach is to address the calibration of the new framework from the bottom up, rather than reverse engineer changes to achieve pre-determined or preconceived approaches to capital requirements,” she said in the prepared remarks.

    The discussions on Tuesday underscore the growing urgency in Washington to modernize financial regulation as technological shifts reshape how money moves and who controls it.

    Source: Bloomberg