Congressional Research Service Report Highlights Regulatory Instability for Banks and Crypto

A recent report from the Congressional Research Service (CRS), published on September 30, 2026, reveals that U.S. banks' ability to engage with digital assets like Bitcoin is heavily dependent on the regulatory environment, which shifts with political leadership rather than established laws.

The report, titled “Crypto and Bank-Permissible Activities” (IF13324), outlines a regulatory landscape that is both ambiguous and fragile. It emphasizes that permissions for crypto-related activities can change with agency leadership and presidential administrations, rather than through consistent statutory guidelines.

Since 2017, the three primary federal bank regulators—the Office of the Comptroller of the Currency (OCC), the Federal Reserve, and the Federal Deposit Insurance Corporation (FDIC)—have reversed their policies multiple times in response to the political climate. The report notes a significant shift from pro-crypto policies during the Trump administration to tighter regulations under the Biden administration, with a subsequent easing of restrictions in March 2025.

The CRS identifies a lack of consensus among regulators regarding a two-part test to evaluate crypto activities: whether they are connected to the “business of banking” and the safety-and-soundness risks they pose. This disagreement leads to inconsistent regulatory outcomes.

Looking ahead, the CRS outlines three potential paths for Congress: continuing to defer to regulators, enacting clear legislation on crypto activities for banks, or a hybrid approach that combines both strategies. Legislative efforts like the GENIUS Act, which permits stablecoin issuance by bank subsidiaries, and the CLARITY Act, which aims to establish a broader regulatory framework, are already underway but face challenges in the legislative process.