Leading financial trade groups, including the American Bankers Association and the Securities Industry and Financial Markets Association, have expressed deep concerns about cybersecurity vulnerabilities at federal regulatory agencies. In a letter to the US Treasury, they highlighted the OCC’s email breach, where hackers accessed 150,000 emails. The associations urged stricter security standards for regulators, better incident response protocols, and reduced data-sharing demands to mitigate risks from nation-state cyber threats. The breach underscores growing fears over the security of sensitive financial data held by government agencies.
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US Treasury’s SLR Overhaul Could Boost Bitcoin Markets
The US Treasury is nearing a decision to overhaul the supplementary leverage ratio (SLR), a post-2008 rule requiring banks to hold capital against even risk-free assets like Treasuries. Exempting or reducing this requirement could free up $250 billion in bank capital, compressing Treasury yields and injecting liquidity into markets. Analysts suggest this regulatory shift could act as ‘shadow QE,’ benefiting Bitcoin as investors seek higher-risk assets. Bitcoin’s price has already reacted, with on-chain data showing tightening supply as institutional buyers accumulate. Critics warn that banks may still hesitate to absorb more Treasury debt, potentially forcing the Fed to intervene. Nevertheless, the SLR adjustment is seen as a structural tailwind for Bitcoin amid fiscal constraints and sticky inflation.
read moreBanks Urge SEC to Rescind Cybersecurity Disclosure Rule
Leading U.S. banking associations, including the American Bankers Association, have formally requested the SEC to rescind its cybersecurity incident disclosure rule. In a May 22 letter, the groups contended that the four-day public reporting mandate undermines confidential cybersecurity protocols and national security efforts. The coalition, which also includes SIFMA and the Bank Policy Institute, warns that premature disclosures could alert malicious actors and hinder regulatory coordination. The SEC has yet to respond to the petition, leaving financial firms in limbo over compliance obligations.
read moreUS Plans to Ease Bank Capital Rules Amid Industry Pushback
The US government is reportedly set to relax banking regulations by lowering the supplementary leverage ratio (SLR), a key capital reserve requirement introduced under Basel III after the 2008 financial crisis. Advocates, including Federal Reserve Chair Jerome Powell and banking lobbyists, claim the move will enhance liquidity in the Treasury market and align US standards with global norms. However, critics like Nicolas Véron of the Peterson Institute warn that easing rules now could expose banks to greater risks amid economic uncertainty. The exact new SLR threshold remains undisclosed, but lobbyists aim to bring US requirements closer to the international minimum of 3%. The debate highlights tensions between financial stability and market flexibility.
read moreFinancial Industry Urges Inclusion of Banking Regulators in Crypto Working Group
A coalition of financial industry groups is urging David Sacks to include federal banking regulators in the President’s Working Group on digital assets. They argue that the current regulatory framework hinders banks’ participation in the crypto space, which is essential for the U.S. to maintain its leadership in the global digital assets ecosystem. The groups emphasize that the involvement of federal banking agencies is crucial for developing a comprehensive regulatory framework that supports the responsible growth of digital assets.
read moreSEC revokes crypto accounting guidance in win for industry
The U.S. Securities and Exchange Commission (SEC) has revoked the controversial accounting guidance known as Staff Accounting Bulletin 121, which required companies to treat digital assets held in custody as liabilities. This decision, welcomed by the crypto industry and banking sector, marks a shift in regulatory approach under the new administration. Republican Commissioner Hester Peirce, who leads a newly formed crypto task force, expressed her approval of the move on social media.
read moreBanks sue Federal Reserve over alleged flaws in stress test procedures
Several groups representing major banks, including JPMorgan and Goldman Sachs, have filed a lawsuit against the Federal Reserve in Ohio, claiming that the Fed’s annual capital stress tests violate US law. The plaintiffs argue that the testing system lacks transparency and was adopted without proper administrative procedures, calling for clearer regulations and public input. The American Bankers Association emphasizes the need for increased transparency to enhance the tests’ effectiveness in assessing bank resilience.
read moreBNY Advances Crypto Custody Services Following SEC’s Revised Accounting Guidelines
The Bank of New York (BNY) is advancing towards offering custody services for Bitcoin and Ether ETFs after the SEC exempted it from the contentious SAB 121 accounting guidelines. This decision may pave the way for other financial institutions to receive similar treatment, provided they ensure adequate protection for client crypto assets. BNY is seeking authorization from additional regulators to scale its custody services for crypto ETP clients.
read moreHouse Fails to Overturn Biden’s Veto on Crypto Banking Rule
The House failed to overturn President Biden’s veto of a measure nullifying the SEC’s guidance on banks offering crypto custody services. The veto means that banks must continue to hold cryptocurrency on their balance sheets as liabilities, hindering their ability to scale crypto custody businesses. Despite bipartisan support, the veto was upheld, with Democratic lawmakers expressing concerns about the broad impact of the Congressional Review Act resolution.
read moreUS Banks Urge SEC for Flexibility in Custodianship of Bitcoin ETFs
Major US banks are urging the SEC to allow them to explore custodianship of recently launched spot Bitcoin ETFs, as they were notably absent from the approved products. The plea aims to modify clauses to provide more flexibility for banks, with experts dubbing the increased interest in Bitcoin spot ETFs as a positive sign for the industry and signaling a bullish streak in Bitcoin’s price.
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