February 10, 2025

This week decoded

White House AI and Crypto Czar David Sacks joined the Republican chairs of the Senate Banking, House Financial Services and House/Senate Agriculture Committees in hosting a press conference to announce a bicameral working group on digital assets and to show party unity on “ensuring American dominance in digital assets” and “creating a golden age in digital assets.” The committee chairs answered questions on timing for stablecoin and market structure bills, related legislative priorities such as AML, and the ongoing education of colleagues on blockchain technologies. Senate Banking Chair Tim Scott (R-SC) said, “My goal is to be as aggressive as possible to achieve an objective of having bills through the Senate in 100 days.”

Debanking and stablecoins were themes of the week. Debanking hearings were held in the Senate Banking and House Financial Services Committees, along with legislation on fair access to banking in both chambers, document releases, letters, publications, and statements. On stablecoins, major bills were introduced in the Senate (GENIUS Act) and House (STABLE Act discussion draft). In the Administration, while the CFTC announced a CEO Forum of firms involved in stablecoins.

Looking ahead, the SEC Crypto Task Force officially launched with detailed priorities, invitations for engagement, and a new website.

Join me February 19 for a networking luncheon and panel discussion on Policy, Innovation, and the Future of Crypto. More details are below in Highlights of the Week. You can also find bonus content in Highlights on the surprising connection between ancient anthropology and blockchain technology – DLT has been an emerging technology for centuries.

Read more below

Congress

Hearings

• Last week
  • On February 5, the Senate Banking Committee held a hearing on Investigating the Real Impacts of Debanking in America.
  • On February 6, the House Financial Services Oversight and Investigations Subcommittee held a hearing on Operation Choke Point 2.0: The Biden Administration’s Efforts to Put Crypto in the Crosshairs.
• This week
  • On February 11, the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee will hold a hearing on A Golden Age of Digital Assets: Charting a Path Forward.
  • On February 11, the Senate Banking, Housing and Urban Affairs Committee will hold a hearing on the Semiannual Monetary Policy Report to the Congress with Fed Chair Jerome Powell.
  • On February 12, the House Financial Services Committee will hold a hearing on the Semiannual Monetary Policy Report to the Congress with Fed Chair Jerome Powell.

Legislation

• Sens. Bill Hagerty (R-TN), Cynthia Lummis (R-WY), and Kirsten Gillibrand (D-NY) and Senate Banking Chair Tim Scott (R-SC) introduced the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act to establish “a clear federal regulatory framework that preserves a strong state pathway to stablecoin issuance.” (Text)(Fact sheet) (Press release)

• House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee Chairman Bryan Steil (R-WI) and Committee Chair French Hill (R-AR) released a discussion draft of the Stablecoin Transparency and Accountability for a Better Ledger Economy (STABLE) Act to establish a framework for the issuance and operation of dollar-denominated payment stablecoins. (Text)(Press release)

• Sen. Mike Lee (R-UT) introduced the No CBDC Act to prohibit the Federal Reserve from developing a Central Bank Digital Currency (CBDC). (Text)(Fact sheet)(Press release)

• Sens. John Curtis (R-UT) and Kevin Cramer (R-ND), with 39 Republican Senators, introduced the Fair Access to Banking Act to prohibit large banks and financial institutions from denying fair access to financial services based on political or ideological preferences. Rep. Andy Barr (R-KY) introduced the House version. (Text)(Senate press release)

• House Subcommittee on Digital Assets, Financial Technology, and Artificial Intelligence Chairman Bryan Steil (R-WI) and House Committee on Commodity Markets, Digital Assets, and Rural Development Chairman Dusty Johnson (R-SD) introduced a House Resolution expressing support for blockchain technology and digital assets. (Text) (Press release)

Correspondence

• Sen. Elizabeth Warren (D-MA) sent a letter to President Donald Trump requesting he lift the stop-work order at the CFPB and allow the Bureau to finalize rules that address debanking due to overdraft fees, religious affiliation, or political beliefs, including the Prohibited Terms and Conditions Proposed Rule, Data Broker Proposed Rule, Overdraft Fee Final Rule, Prohibitions on Unfair Debanking, and Larger Participant Final Rule. Warren also encouraged the prudential regulators to use existing authority to address debanking. (Letter)

Publications

• Sen. John Kennedy (R-LA) published an op-ed in the New York Post arguing Congress must defend freedom of dissent after Biden’s outrageous “debank” scandal, focusing on religious and political discrimination in access to financial services. (Op–ed)

Trump – Vance Administration

Securities and Exchange Commission (SEC)

• Commissioner Hester Peirce issued a statement entitled The Journey Begins, detailing her priorities for the SEC’s new Crypto Task Force, including clarifying the status of crypto assets, lending, and staking under securities laws; no-action letters; temporary relief for coin or token offerings; modifying registered offerings; special-purpose broker dealer no-action updates; custody solutions for investment advisers; consideration of new exchange-traded products; modernizing clearing agency and transfer agent rules; and creating a cross-border payment sandbox. Peirce also details how stakeholders can engage with the Task Force. (Statement)
• The SEC Crypto Task Force launched a new webpage. (Site)

Commodity Futures Trading Commission

• The CFTC announced a CEO Forum of firms involved in stablecoins, including Circle, Coinbase, Crypto.com, MoonPay and Ripple, to discuss the launch of the CFTC’s digital asset markets pilot program for tokenized non-cash collateral. (Press release)

Federal Deposit Insurance Corporation (FDIC)

• The FDIC released 175 documents totaling 790 pages related to supervision of banks involved in crypto-related activities. (Correspondence)(Procedures)(Pause letters)(FOIA Reading Room)

Noteworthy Quotes and Events

ADMINISTRATION

White House

• White House AI and Crypto Czar David Sacks said in an opening statement at the Republican news conference on digital assets, “Our objective is to accomplish the task the president assigned for us in his EO, which is to propose a federal regulatory framework governing the issuance and operation of digital assets, including stablecoins in the United States. I’ve talked to many founders over the past few years. And they’ve told me repeatedly that the number one thing they need from Washington has regulatory clarity. They just want to know what the rules of the road are, so they can abide by them.”

Securities and Exchange Commission (SEC)

• In an interview with CoinDesk, Commissioner Hester Peirce discussed The Journey Forward and said “people don’t really trust the SEC anymore” and her goal of engaging in productive conversations. (Video)(Clip)

Federal Deposit Insurance Corporation (FDIC)

• Acting Chair Travis Hill issued a press statement upon the release of documents related to supervision of crypto-related activities, saying, “Previously, the FDIC released 25 so-called ‘pause’ letters sent to 24 institutions interested in pursuing crypto- or blockchain-related activities. The documents released today include (1) additional correspondence with those 24 institutions and (2) correspondence with additional institutions beyond those 24. The documents that we are releasing today show that requests from these banks were almost universally met with resistance, ranging from repeated requests for further information, to multi-month periods of silence as institutions waited for responses, to directives from supervisors to pause, suspend, or refrain from expanding all crypto- or blockchain-related activity. Both individually and collectively, these and other actions sent the message to banks that it would be extraordinarily difficult—if not impossible—to move forward. As a result, the vast majority of banks simply stopped trying. Looking forward, we are actively reevaluating our supervisory approach to crypto-related activities. This includes replacing Financial Institution Letter and providing a pathway for institutions to engage in crypto- and blockchain-related activities while still adhering to safety and soundness principles. The FDIC also looks forward to engaging with the President’s Working Group on Digital Asset Markets established by the President’s January 23, 2025 Executive Order.” (Press release)

CONGRESS

Debanking Hearings

• Sen. Cynthia Lummis (R-WY) released a statement on the FDIC document release, saying, “The days of an administration that operates in the dark are over. I appreciate the Trump administration for ensuring the federal government is transparent and beholden to the American people it serves. I look forward to working with Acting Chairman Hill to restore the FDIC’s mission to serving American businesses, not shielding unelected bureaucrats.” (Press release)

• Lummis tweeted an appearance on Fox Business and said, “Your views on guns, crypto, or religion should NOT be relevant to your banking business. We are blowing the whistle on debanking and Chokepoint 2.0. The Federal Reserve must never be allowed to engage in these actions again.”

• Lummis also tweeted, “Today, BankingGOP discovered the first indisputable evidence of Operation Chokepoint 2.0. Rest assured, the Subcommittee on Digital Assets WILL find those responsible and hold them accountable.”

• Sen. Mike Rounds (R-SD) tweeted, “This week’s BankingGOP hearing confirmed what many have feared: misguided debanking policies and an anti-crypto and fintech bias from Biden-era regulators are stifling innovation and impacting growth. Banks should be able to provide services to legal businesses – it’s as simple as that. We need common-sense oversight that protects our financial system while unleashing progress. Thank you to Nathan McCauley from Anchorage Digital in Sioux Falls for coming and telling your story.”

• Financial Services GOP tweeted, “Our regulators’ highest priority should be promoting safety and soundness at our financial institutions, not picking winners and losers in our economy.”

• Rep. Dan Meuser (R-PA) tweeted, “The Biden administration’s Operation Choke Point 2.0 weaponized regulators to debank crypto, forcing innovation out of the U.S. The FDIC, OCC, and the Fed actively pressured banks to steer clear of digital assets—crippling crypto in our country. Today’s FinancialCmte hearing will expose how this debanking occurred, hold regulators accountable, and lay the groundwork to allow crypto to thrive. This is about regulators getting on board with a reasonable regulatory framework for digital assets, if not, we are at risk of losing this important industry.”

• Rep. Bryan Steil (R-WI) tweeted, “Financial institutions should not be punished for engaging in digital assets.”

• Rep. Ann Wagner (R-MO) tweeted, “I spoke during our Financial Services Oversight and Investigations subcommittee hearing on digital assets. It is clear that under the Biden administration, digital asset firms were the victim of a pressure campaign initiated by regulators, designed to cut them off from our economy. Regulators should not be picking winners and losers based on what industries enjoy the political favor of the sitting President. Individuals operating fully legal businesses deserve the right to seek access to banking, and banks must be free to make decisions about the customers they serve—without regulators pressuring them to toe a hostile Administration’s line.”

Miscellaneous

• In the House Small Business Committee hearing on Prioritizing Small Business Growth, Rep. Troy Downing (R-MT) said, “Now we’re entering into a brave new world as cryptocurrency, blockchain and artificial intelligence integrate further into every sector of the economy, our energy, infrastructure and production capacity are nowhere near the size they need to be to manage this technological expansion. Now, unleashing American energy production is a priority for the Trump administration. And I look forward to working with them to do just that.” 

• Sen. Bill Hagerty (R-TN) tweeted, “The tide has turned in favor of digital assets here in America. I’m pleased to lead my colleagues in the GENIUS Act, which will help make our nation a positive environment for stablecoins and digital assets.”

• Sen. Cynthia Lummis (R-WY) tweeted, “I’ve said it once, and I’ll say it again: this is the year for digital assets. I joined Senator Hagerty to introduce the GENIUS Act, fulfilling POTUS’s promise to make America the capital of crypto.”

• House Financial Services Chair French Hill (R-AR) tweeted, “I was so pleased to come together with Senator Tim Scott, davidsacks47, John Boozman, and Congressman GT yesterday to talk about our priorities to move regulatory clarity for digital assets in the US so that we can have fintech and digital assets be a premiere area of innovation and technological advance right here in America.”

• In an interview on CNBC’s SquawkBox, Hill said, “Crypto has been under assault by the SEC over the past four years, and so the reason for legislation is to have a regulatory clarity that directs the SEC and the CFTC exactly what they need to do to protect investors, encourage innovation, encourage companies to use blockchain, and that’s what we’re going to do.” (Press release)

• House Committee on Agriculture tweeted, “FYI: The Ag Committees oversee CFTC, which regulates commodity derivatives & polices spot markets. Commodities aren’t just wheat & corn—they include digital assets like ₿itcoin & Ether. That’s why this bicameral group is key to shaping clear, fair rules.”

• House Committee on Agriculture also tweeted, “Millions of Americans trade digital assets every day, but without clear federal regulations, they’re left navigating uncertainty. We need a regulatory framework that fosters innovation while protecting consumers. The SEC and CFTC both play a role in digital asset regulation—but gaps remain. Without clear guidance, innovation is stifled, and bad actors thrive. Congress must step up. The SEC’s “regulation by enforcement” approach to digital assets is leaving entrepreneurs in the dark. Clear, consistent rules—not lawsuits—are needed for responsible growth. America should lead the future of digital assets—but our outdated regulations are driving innovation overseas. We need a regulatory framework that works for both businesses & consumers. Retail investors are flooding into digital asset markets—but without clear regulations, they lack basic consumer protections. It’s time to close the regulatory gaps and ensure a fair playing field. The CFTC regulates commodity derivatives. The SEC oversees securities. But when it comes to digital assets, a regulatory “no man’s land” exists. It’s time to bring clarity to the market. America is falling behind on digital asset innovation. Other countries are moving forward with clear rules, while America relies on lawsuits instead of leadership. That needs to change.”

• Rep. Gwen Moore (D-WI) tweeted, “When Elon Musk bought Donald Trump, he bought access to your private financial information. The Scammer-in-Chief has crypto bro interns digging through everything from your bank accounts to Social Security number.”

• Rep. Frank Pallone (D-NJ) tweeted, “Trump and the Republicans want to completely deregulate the crypto industry, which will only help scammers take advantage of inexperienced investors while avoiding taxes on their ill gotten gains.”

Highlights of the Week

• Join me at a luncheon and panel discussion on Policy, Innovation, and the Future of Crypto on February 19 in Washington, DC. This informal networking event will bring together policymakers, crypto industry leaders, investors, and academics to explore the evolving intersection of cryptocurrency, blockchain technology, and public policy.   

• The Wilson Center Digital Assets Forum hosted a briefing on the New Executive Order on Cryptocurrency and Financial Innovation. Shout out to Alan Rechtschaffen, Wilson Center Trustee and Chair of the Digital Assets Forum, for introducing me to the stone currency distributed ledger system on the Micronesian island of Yap.  

What I’m Reading This Week

• De-Banking/De-Risking: Issues for the 119^th Congress, Congressional Research Services (CRS).

• Banking on Stone Money: Ancient Antecedents to Bitcoin, Scott M. Fitzpatrick and Stephen McKeon, Economic Anthropology.

About Zero One Strategies

Zero One Strategies is a boutique government relations practice dedicated to navigating the complex landscape of U.S. federal policy in emerging technologies. As advancements in technology continue to outpace regulatory frameworks, Zero One Strategies aims to provide strategic guidance and bipartisan advocacy for innovators and businesses operating at the forefront of technological development.

The practice focuses on key areas such as artificial intelligence, blockchain, decentralized technologies, cybersecurity, data, and digital infrastructure, as well as the multiple policy issues impacting these sectors, including tax and financial services.

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