How Banking-Grade Crypto Is Replacing Bitcoin’s Cowboy Finance

Crypto’s Wild West used to have a cowboy problem. For much of the sector’s nascent history there were too many gunslingers and not enough sheriffs, with the digital asset space defined by its rule avoidance and a culture that prized speed over safety.

But after years of rug pulls, bankruptcies and busted idols, the cryptocurrency industry is learning that lawlessness is more a liability than it is a pre-requisite for innovation. What is happening now looks very different from the on-chain ecosystem of the 2010s, when bitcoin first launched. Since the start of 2026, a sequence of tightly scoped but consequential actions by U.S. regulators including the Securities and Exchange Commission (SEC), the Depository Trust & Clearing Corporation (DTCC), and the Office of the Comptroller of the Currency (OCC) have begun to normalize blockchain technology inside layers of the financial system.

These U.S. agencies are drawing a new map to show where digital assets can live inside existing market plumbing: how tokenized securities can settle through familiar clearing rails, how broker-dealers can custody crypto assets without breaking customer-protection rules and how banks themselves can hold, transfer and even issue blockchain-based instruments at scale.

See also: Crypto IPOs Are Getting Boring, and That’s the Point

From Parallel Ledgers to Core Market Infrastructure

In December 2025, the SEC issued a no-action letter permitting DTCC’s depository subsidiary to run a controlled, multi-year production program that tokenizes assets already custodied and settled through DTCC infrastructure. The scope is deliberately conservative: U.S. Treasuries, select large-cap equities, and index-tracking ETFs. But the implication is that tokenized representations of these instruments are being treated as legally equivalent to their traditional forms, with the same economic entitlements and settlement finality.

After all, DTCC is not a sandbox at the edge of finance; it is the backbone of U.S. post-trade processing. By authorizing tokenization within this environment, regulators are signaling that blockchain can function as an internal system upgrade rather than an external competitor.

And firms are already taking the green light at face value. On Jan. 19, the New York Stock Exchange, part of Intercontinental Exchange, Inc., announced it was developing a platform for the trading and on-chain settlement of tokenized securities, for which it will seek regulatory approvals.

Crypto-native firms are getting into the treasury and equity management game as well, with Ripple on Jan. 28 introducing a treasury platform built atop enterprise blockchain infrastructure.

At the same time, some of the world’s payment networks used their recent earnings investors calls to detail the numbers and strategies behind stablecoins, which are becoming among the most intriguing and even divisive tokenized on-chain financial instruments.

It’s not just payment networks, either. PYMNTS and Citigroup have launched of a weekly podcast series offering corporate leaders practical guidance on stablecoins and tokenized real-world assets. “From the Block: Straight Talk on Stablecoins and Digital Assets for Corporate Leaders,” which debuted Jan. 13, will be co-hosted by PYMNTS CEO Karen Webster and Citi Global Head of Digital Assets, Treasury and Trade Solutions Ryan Rugg.

See also: Conditional Charters Pull Crypto Closer to Core of US Banking

Custody Stops Being the Weak Link

If there was one issue that consistently stalled institutional crypto adoption, it was custody. The technology promised self-sovereignty, but institutions require segregation, control, auditability and regulatory certainty.

Recent OCC and SEC guidance has begun to dismantle that barrier. Rather than inventing a bespoke cryptocurrency custody regime, the SEC, across a series of letters and speeches, has proven to be set on clarifying how existing rules apply to digital assets, especially when those assets are securities. Broker-dealers can now custody crypto asset securities either through qualifying third-party control locations or, under defined conditions, directly on-chain while still being deemed in “physical possession” of the asset.

Still, the speeches and letters are just that, and none of the guidance has been codified into law by the Senate and House. As Dan Boyle, partner at Boies Schiller Flexner, told PYMNTS’ Karen Webster in an earlier interview, crypto is not getting a get-out-of-jail-free card.

In parallel, the OCC has conditionally approved several national trust banks designed specifically to offer digital-asset services under close supervisory oversight.

See also: Stablecoin Fragmentation Creates New Risks for Businesses

Banks Re-Enter the Crypto Picture on Their Own Terms

Perhaps the clearest signal that crypto’s cowboy era is ending comes from banks themselves. For years, the relationship between banks and digital assets oscillated between caution and outright hostility. Now it is settling into something more pragmatic.

The recent guidance from federal regulators opens the door to products that have long been discussed but rarely implemented at scale: deposit tokens that move across internal blockchains, regulated stablecoins backed by bank balance sheets and tokenized assets that settle with the same confidence as traditional cash and securities. None of this looks like decentralized finance in its original sense. But it looks very much like financial infrastructure modernization.

News broke at the end of last year (Dec. 15) that J.P. Morgan Chase is reportedly deepening its blockchain efforts with its first tokenized money market fund; while on Jan. 28 of this year, Fidelity Investments announced it will launch a stablecoin called the Fidelity Digital Dollar (FIDD).

The PYMNTS Intelligence and Citi report “Chain Reaction: Regulatory Clarity as the Catalyst for Blockchain Adoption” found that blockchain’s next leap will be shaped by regulation; that evolving guidance is beginning to create the foundations for safe, scalable blockchain adoption; and that implementation challenges continue to complicate progress.