November 3, 2025
This week in digital asset federal policy
This week decoded
This week in digital asset federal policy, the OCC and FDIC published a notice of proposed rulemaking to codify the elimination of reputation risk from supervisory programs; the public comment period ends December 29, 2025. Treasury Secretary Scott Bessent discussed efforts in increasing the use of digital assets and U.S. dollar stablecoins with the Prime Minister of Singapore. The comment period on Treasury’s GENIUS Act implementation ANPRM closes November 4.
In Congress, Senators opine about the chances of market structure passage this year and question the viability of a de minimis tax exemption for digital asset capital gains.
Speaking of market structure, all eyes are on the Senate Agriculture Committee and the potential impending release of their CFTC-focused market structure draft text.
Read more below
Congress
Hearings
Last week
On October 30, the Senate Banking Committee held a hearing to consider the nomination of Travis Hill to be Chairperson of the Board of Directors of the Federal Deposit Insurance Corporation (FDIC).
This week
No relevant hearings are scheduled this week.
Legislation
Rep. Scott Fitzgerald (R-WI) introduced a bill to strengthen the authority of the United States Secret Service to investigate various crimes related to digital asset transactions and to counter transnational cybercriminal activity, including unlicensed money transmitting businesses, structured transactions, and fraud against financial institutions. (Text)
Rep. Tom Suozzi (D-NY) introduced the Market Choice Act, which contains a provision establishing an interagency task force to create recommendations targeting money laundering related to human trafficking, including changes to “existing statutory law to more effectively detect and deter money laundering relating to severe forms of trafficking in persons, where such money laundering involves the use of emerging technologies and virtual currencies.” (Text)
Rep. Ro Khanna (D-CA) announced he would introduce the Ban Crypto Corruption resolution to “prohibit the issuance, sponsoring or endorsing of digital assets (including cryptocurrency, meme coins, stablecoins, tokens, NFTs, digital trading cards, and decentralized finance platforms) by the President, Vice President, Members of Congress, candidates for public office, elected public officials, high-ranking executive branch employees and special government employees, and their immediate family members; require politicians and their immediate family members to place any digital assets they hold in a qualified blind trust inaccessible during their candidacy, public service, and 2 years after an individual’s service; prohibit foreign investment in any digital assets issued, promoted, or controlled by politicians and their immediate family; and mandate the full and timely disclosure of all cryptocurrency transactions by politicians and their immediate family. (Text)
Sen. Thom Tillis (R-NC) released a discussion draft of the Ensuring Fair Access to Banking Act to prevent both regulator and financial institution-initiated de-banking by establishing a federal fair access standard, enforcement mechanisms, and additional targeted reforms to the examination and supervision process. (Press release)
Correspondence
Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee Elizabeth Warren (D-MA), Ranking Member of the Senate Committee on Health, Education, Labor and Pensions Bernie Sanders (I-VT), Ranking Member of the Senate Judiciary Committee Dick Durbin (D-IL), and Ranking Member of the Senate Finance Committee Ron Wyden (D-OR), and Sens. Jeff Merkley (D-OR), Chris Murphy (D-CT), Tina Smith (D-MN), sent a letter to Labor Secretary Lori Chavez-DeRemer and Securities and Exchange Commission Chair Paul Atkins raising concerns about President Donald Trump’s executive order allowing alternative assets in Americans’ retirement plans. The letter says, “The Executive Order exposes these hard-earned savings to volatile financial instruments, while attempting to rebrand them as ‘alternative assets,’ although they lack transparency and have exaggerated claims of high returns.” (Letter)
Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee Elizabeth Warren (D-MA), Ranking Member of the Senate Committee on Health, Education, Labor and Pensions Bernie Sanders (I-VT), Ranking Member of the Senate Armed Services Committee Jack Reed (D-RI), and Sens. Chris Van Hollen (D-MD), Mazie Hirono (D-HI), Richard Blumenthal (D-CT), and Jeff Merkley (D-OR) sent a letter to Attorney General Pamela Bondi and Treasury Secretary Scott Bessent expressing concerns on how President Donald Trump’s pardon of Binance founder Changpeng Zhao will affect their agencies’ ability to hold criminals accountable. (Letter)
Trump Administration
The Office of the Comptroller of the Currency (OCC) and the Federal Deposit Insurance Corporation (FDIC)
The OCC and FDIC published a notice of proposed rulemaking to codify the elimination of reputation risk from supervisory programs. The proposed rule would prohibit the agencies from taking adverse action against an institution on the basis of reputation risk, and from requiring, instructing, or encouraging an institution to close an account, refrain from providing an account, product, or service, or modify or terminate any product or service on the basis of a person or entity’s political, social, cultural, or religious views or beliefs, constitutionally protected speech, or solely on the basis of politically disfavored but lawful business activities perceived to present reputation risk. The notice was originally announced on October 7, 2025. The public comment period ends December 29, 2025. (Federal Register)
Consumer Financial Protection Bureau (CFPB)
The CFPB issued a final rule to rescind its rule requiring certain types of nonbank covered persons subject to certain final public orders obtained or issued by a government agency in connection with the offering or provision of a consumer financial product or service to report the existence of the orders and related information to a Bureau registry. The CFPB originally announced the recission in May. (Federal Register)
Internal Revenue Service (IRS)
The Treasury Inspector General for Tax Administration (TIGTA) released a report on IRS management challenges that highlights tax compliance efforts around digital assets, saying, “The IRS had made progress addressing the tax implications of virtual currencies, another emerging industry. In the last 15 years, virtual currencies have grown into a trillion-dollar industry and have proven challenging for the IRS from both a guidance and an enforcement perspective. The IRS considers virtual currency as property, that when sold, can create taxable consequences each time the virtual currency is used. For some taxpayers, the anonymity of virtual currency is appealing, and it complicates the IRS’s enforcement efforts. We reported that IRS Criminal Investigation used analytics to address virtual currency noncompliance. Between FYs 2018 to 2023, IRS investigated 390 cases involving virtual currencies. In that period, 224 cases were completed with a recommendation for prosecution.” (Report)
Treasury Department
The comment period for the advance notice of proposed rulemaking (ANPRM) on implementation of the GENIUS Act closes on November 4, 2025. (Federal Register)
During Secretary Scott Bessent’s meeting with Prime Minister Lawrence Wong of Singapore, the Secretary recognized Singapore’s efforts in increasing adoption and use of digital assets and U.S. dollar stablecoins. (Press release)
Noteworthy Quotes and Events
ADMINISTRATION
Securities and Exchange Commission (SEC)
Commissioner Hester Peirce posted “Congratulations to MikeSeligEsq on your nomination to be CFTC Chairman. Having had the opportunity to work with you on the Crypto Task Force, I know the CFTC will be in good hands”
CONGRESS
Market Structure Legislation
On the ability to get market structure done this year, Sen. Thom Tillis (R-NC) said, “Unless something happens in the first quarter, it’s unlikely to happen. And with everything else going on, I just don’t see how they have enough runway to land.” (Punchbowl)
On the same question, Sen. Cynthia Lummis (R-WY) said, “I think it’s still feasible. Now, remember: I’m a perennial optimist. I’m a glass-half-full girl.”
When asked by Punchbowl News if President Trump’s pardon of Changpeng Zhao would make bipartisan negotiations on market structure legislation more difficult, Sen. Cynthia Lummis (R-WY) said, “I can’t think of any way that we can make the politics of market structure more difficult.” (Punchbowl)
On market structure negotiations, Sen. Catherine Cortez Masto said, (D-NV) “Time is of the essence. We get that. But setting an arbitrary deadline without having the ability to work through it, with all the issues with our colleagues, is not helpful.” (Punchbowl)
On negotiating market structure legislation during the government shutdown, Sen. Mark Warner (D-VA) said, “We should be able to freaking multitask a bit.” (Punchbowl)
When asked by Punchbowl News if market structure legislation pass before the end of the year, Warner said, “I don’t know. The one thing that’ll guarantee it won’t happen is if we can’t get Democratic and Republican staff back in the room together.” He added, “Republicans on the Banking committee — you know, they’ve got questions too, because this is really complicated.” (Punchbowl)
Sen. Ruben Gallego (D-AZ) told Punchbowl, “I don’t think anything’s changed. [Scott’s] problem is that his own members don’t support the markup date.” (Punchbowl)
Asked about Sen. Elizabeth Warren’s calls for addressing corruption connected with presidential pardons, Gallego said, “She’s not wrong. It does need to be addressed, and the president and Binance are causing the issue.” (Punchbowl)
Sen. Katie Britt (R-AL) told Punchbowl she has concerns about ancillary assets and impacts on community banks, saying, “That is kind of an outstanding question — of just making sure that we preserve those institutions, knowing they are the ones that so often are giving the home loan to achieve the American dream or giving that line of credit to create this small business.” (Punchbowl)
On market structure generally, Sen. Josh Hawley (R-AR) said, “I don’t know the details. But it seems to me like some sort of regulatory framework that is predictable is going to be necessary. And right now, it’s sort of the Wild West.” (Punchbowl)
Of crypto industry executives, market structure legislation skeptic Sen. John Kennedy (R-LA) said, “I invited them to send me their white papers. I haven’t yet received anything. I met with the White House czar [David Sacks]. Nice guy. Really smart. He has promised to send me something. I’m sure he will. He hasn’t sent it to me.” (Punchbowl)
Digital Asset Tax Legislation
On potential consideration of a de minimis exemption for nominal digital asset transactions, Sen. Elizabeth Warren (D-MA) said, “Why should crypto get a special deal?” She continued, “They don’t want to follow the same income rules that all stock brokers and other traders have to follow… They can’t play the game both ways.” (PoliticoPro)
Sen. Cynthia Lummis (R-WY) responded, “Otherwise American businesses and consumers will face ridiculous recordkeeping requirements.” She added, “This isn’t about giving a ‘tax break’ to digital asset uses, it’s about giving digital assets the same treatment as foreign exchange transactions so they can be used for payments.” (PoliticoPro)
On support for a de minimis exemption, Senate Finance Ranking Member Ron Wyden (R-OR) said, “I have some due diligence to do.” (PoliticoPro)
On support for a de minimis exemption, Senate Finance Chair Mike Crapo (R-ID) said, “We have to decide that, but I have not yet taken a position on it.” (PoliticoPro)
On the potential for bipartisan legislation, Crapo said, “I hope that we will be able to get a bipartisan approach and, if and when that comes together, then we could put out a discussion draft, but I can’t predict.” (PoliticoPro)
Miscellaneous
Sen. Roger Marshall (R-KS) said about China, “Don’t underestimate them. And I know you don’t. I’m much more concerned about the cyber-attacks from China and what they’re doing with crypto. The Chinese triad, the Chinese mafia that’s throughout the United States. They do all the money laundering for the cartel. They’ve taken over the marijuana industry across the country as well. And they are very involved in human trafficking in many ways as well. So, all I can tell you is, however bad you think it is, it’s worse, and it’s a full-time job just trying to keep track of the CCP in the country.” (Press release)
House Financial Services Ranking Member Maxine Waters (D-CA) issued a press release on the pardon of Changpeng Zhao, saying, “Since taking office, Trump has made it his priority to excuse crypto criminals while weakening the very regulators responsible for holding these bad actors accountable and protecting American investors. One of his earliest actions was to gut the SEC and dismantle the Justice Department’s National Cryptocurrency Enforcement Team—the specialized unit responsible for prosecuting crypto-related crimes. In fact, in just the first month of his presidency, the Administration dropped investigations or cases against at least 89 companies.” (Press release)
What I’m Reading This Week
Digital Asset Tax Treatment Doubly Highlighted, Part 1, Carrie Brandon Elliott, Tax Notes.