Government Official Advocates for Employee Cryptocurrency Holdings to Enhance Regulatory Scrutiny

Michelle Bowman Advocates for Flexible Crypto Regulation at Wyoming Blockchain Symposium

In a significant development for the cryptocurrency industry, Michelle Bowman, the Deputy Chair for Supervision of the U.S. Federal Reserve, called for tailored regulation and increased staff involvement in digital assets during the 2025 Wyoming Blockchain Symposium.

Bowman, who has been a strong advocate for cryptocurrencies, compared the need for crypto knowledge to learning a sport. She stated that one cannot teach skiing without ever putting on skis, implying that regulators need hands-on experience to understand the intricacies of cryptocurrencies.

Bowman believes that exposure to crypto ownership would give regulators direct insight into how transfers and custody work. She suggested that Federal Reserve staff should be allowed to own limited amounts of cryptocurrencies to better understand blockchain and digital assets.

The proposed framework, according to Bowman, aims to allow banks to engage with crypto firms legally and manageably. It also aims to keep banks stable while remaining competitive in digital finance. Consumer protections, anti-money laundering standards, and safety requirements must still apply in the new regulatory framework.

Bowman emphasized the importance of collaboration between banks, developers, and regulators in building a durable framework. She outlined principles for a clear and proportional regulatory framework for digital assets, suggesting that tailoring supervision means evaluating each use case individually instead of applying worst-case assumptions.

The debate over cryptocurrencies inside U.S. regulatory circles has taken a new turn with Bowman's comments. Her remarks came as regulators explore staff crypto exposure rules, following the passage of the GENIUS Act, which puts stablecoins under new federal oversight.

Bowman's suggestion is intended to boost the ability of regulators to supervise the technology with real-world knowledge. She also highlighted that limits on staff investments may hinder the Fed's ability to hire and retain skilled supervisors.

The proposed framework, if implemented, could revolutionize the way cryptocurrencies are regulated in the United States. It is a step towards fostering a more inclusive and innovative digital finance ecosystem. The comments were delivered during a high-profile blockchain event in Wyoming, marking a significant milestone in the ongoing discourse about the future of cryptocurrencies.