Michelle Bowman, the newly appointed vice chair for supervision at the U.S. Federal Reserve, has expressed openness to allowing Fed staff to hold small amounts of cryptocurrency, such as Ether, to better understand the underlying technology. In a speech delivered in Wyoming, Bowman emphasized the need for a clear and strategic regulatory framework for the crypto industry that facilitates innovation while recognizing the limitations of applying traditional banking regulations to emerging digital assets [3]. She likened the idea of regulators lacking hands-on experience with crypto to a ski instructor who has never skied, underscoring the importance of direct engagement with new financial technologies [3].
Bowman’s comments reflect a broader shift in the Federal Reserve’s approach to digital assets. She noted that banks that fail to embrace the evolution of the crypto space risk diminishing their role in the broader financial system [3]. Her stance aligns with the recently passed Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, which mandates the development of stablecoin regulations tailored to the unique characteristics of these digital assets. As the leading figure in drafting these rules, Bowman is expected to play a crucial role in shaping the Fed’s approach to stablecoins and asset tokenization [3].
Beyond her crypto-related initiatives, Bowman has also spoken on the Fed’s capital rule reforms. She stated that the agency is reworking its capital requirements for large banks, aiming to propose a new risk-based capital rule by early 2026 [2]. The new rules are expected to be less burdensome than the Biden-era plan, which was criticized for its complexity. The revised approach will integrate with the Fed’s broader regulatory efforts, including changes to leverage ratios, which could allow banks to lend more relative to their capital holdings [1]. These proposals are currently under public review, with a comment period set to close on August 26 [1].
The Fed’s regulatory agenda extends to addressing concerns about “debanking,” the practice of banks withdrawing services from certain individuals or businesses. In response to criticism from President Donald Trump and lawmakers, the Fed has committed to removing reputation risk from its examination criteria [2]. This shift is part of a larger effort to ensure fair access to banking services, though consumer advocates remain divided on the extent of the issue.
While much of the attention on the Fed has centered on its regulatory and crypto initiatives, discussions about interest rates remain a key focus. Bowman has maintained her stance against an immediate rate cut, despite pressure from the Trump administration and a recent weak jobs report. Markets are currently pricing in an 83 percent chance of a rate cut in September, but uncertainty persists due to mixed signals on inflation and labor conditions [1]. The Fed’s policy direction will be closely watched ahead of the upcoming Jackson Hole Symposium, where Chair Jerome Powell is expected to provide further guidance on the central bank’s strategy.
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[1] Fed’s Bowman doubles down on her dissent (https://thehill.com/business/5459518-michelle-bowman-rate-cut/)
[2] Bowman Focuses on Her Current Fed Role Including … (https://www.bloomberg.com/news/articles/2025-08-19/bowman-focuses-on-her-current-fed-role-including-rules-overhaul)
[3] U.S. Federal Reserve’s New Supervision Chief Sold on … (https://www.coindesk.com/policy/2025/08/19/u-s-federal-reserve-s-new-supervision-chief-sold-on-bringing-crypto-to-finance)
