Digital Asset Regulatory Recommendations
In January 2025, President Trump signed Executive Order 14178 (“the EO”), “Strengthening American Leadership in Digital Financial Technology”, establishing the President’s Working Group on Digital Asset Markets (the “group”). The group consists of officials throughout the Federal government who were tasked with submitting a report that recommends regulatory and legislative proposals to advance the policies in the EO. In early August, the group released the report, which offers those recommendations on how digital assets should be regulated. Below you will find the key recommendations within the report and an analysis of the potential impact on credit unions.
First, let’s take a look at some of the key recommendations made within the report and also summarized within this White House Fact Sheet:
1. Define U.S. Leadership in Digital Asset Markets
• Focus on an intention to promote growth and the use of digital assets across the U.S. economy, positioning the United States as the leader in digital asset markets.
• Suggest that Congress should build on the CLARITY Act.
• Grant the Commodity Futures Trading Commission (“CFTC”) authority over spot markets for non-security tokens and maintain U.S. Securities and Exchange Commission (“SEC”) oversight for securities.
2. Regulatory Clarity via SEC and CFTC
• Use existing authority to enable digital asset trading at the federal level, clarifying rules on registration, custody, trading, and recordkeeping.
• Implement safe harbors (sandboxes) and/or pilot programs for new ideas.
3. Modernize Banking Regulation
• Clarify permissible bank activities: what are they allowed to do with digital assets?
• Increase transparency and adjust bank capital rules to reflect the actual risks of digital assets.
4. Protect the U.S. Dollar
• Fully implement the GENIUS Act, including reserve requirements, issuer disclosures, and prohibitions on misleading marketing by stablecoin issuers.
• Ban creation of a Central Bank Digital Currency (to avoid privacy and surveillance risks.
• Support private U.S. dollar-backed stablecoins instead of a government-issued digital dollar.
5. Fight Financial Crime Without Overreach
• Clarify Bank Secrecy Act (BSA) obligations and Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) (collectively: BSA/AML/CFT) reporting requirements.
• Modernize AML/CFT and sanctions regulations to fit digital assets.
• Clarify FinCEN guidance.
• Define compliance rules for decentralized actors (like DeFi protocols) in compliance but protect users’ privacy rights too.
6. Reform Tax Rules
• Change IRS guidance so people aren't taxed unfairly when earning staking rewards or mining.
• Ensure taxes reflect how people actually use and benefit from digital assets.
7. Enhance Transparency & Auditing
• Enforce stronger disclosure and audit requirements for crypto exchanges, including reserve transparency and proof of solvency for intermediaries.
8. Align Bank Capital Rules With Actual Risk Faced
Capital standards for credit, market, liquidity, and operational risks should be updated, based on real and recent data about showing how crypto assets actually behave.
It’s important to note that some of these recommendations can only be achieved through legislation and that agencies may choose to act in a way that aligns with the intent of the Executive Order; however, they are not required to do so.
Next, let’s see how all of this could impact the credit union world, if implemented.
First, the report suggests adjusting bank capital rules to accurately reflect the risk of the digital asset or activity. While credit unions aren’t directly mentioned, aligning these rules could mean that credit unions could see tailored capital requirements that scale with their actual risk exposure of digital-asset activities. This could be an opportunity for credit unions to urge the NCUA to modernize capital rules, fostering stability in a way that is comparable to banking regulators.
The report also promotes development of stablecoins that don’t threaten U.S. dollar sovereignty. In July of 2025, the GENIUS Act was signed into law, which created a federal regulatory framework for stablecoins. Dollar-backed stablecoins could help credit unions implement faster, cheaper cross-border payments or member-to-member transfers. America’s Credit Unions advocated for the inclusion of credit unions and the NCUA in the GENIUS Act to ensure parity with bank authorities.
The report calls for regulatory clarity and delineated responsibilities among federal agencies. This encourages NCUA guidance on digital asset risks, vendor oversight, and disclosures, which in turn could help create regulatory certainty for credit unions.
The report also provides multiple recommendations from a BSA/AML/CFT and sanctions regulatory compliance standpoint. The focus is on encouraging revision of BSA/AML/CFT and sanctions regimes that impose clear obligations, tailored to the risk and structure of the industry. Existing guidance is often interpreted for large banks and crypto exchanges, not smaller institutions. Without this clarity, institutions risk over- or under-complying—both of which can be costly. If rules are updated to better match how digital asset transactions work, it reduces ambiguity, helps compliance teams align procedures with clear expectations, and lowers regulatory risk.
In sum, the recommendations outlined in the report signal a significant shift toward increasing regulatory clarity, enhancing opportunities for innovation, and modernizing the digital asset space. As digital finance evolves, credit unions will need to stay informed and proactive to ensure they can effectively serve their members in a changing financial landscape.
Since I mentioned both the CLARITY and GENIUS Acts, here is a blog we recently published that discuss these Acts in greater depth. We also have FAQs on the GENIUS Act.
If you have any questions regarding this topic or other compliance topics, America’s Credit Unions compliance team can be reached at compliance@americascreditunions.org .
