FinReg Currents

Keep up with the latest legal and industry insights, news, and events from MoFo

Each week of the first 100 days of the new Trump administration, we will publish updates on key federal financial services regulatory and related developments.

This week, we review the following developments as of Wednesday:

Senate Banking Committee Approval of Nomination of McKernan to Lead Consumer Financial Protection Bureau (CFPB)
Treasury Secretary Bessent on Refocusing Banking Regulation
White House Executive Order on Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile, Digital Assets Summit
Office of the Comptroller of the Currency (OCC) Reaffirmation of Bank Authority to Engage in Certain Crypto-Asset Activities
OCC Workforce Reduction from Administration Buyout Offer
Securities and Exchange Commission (SEC) Acting Chairman Uyeda’s Direction to Staff to Determine How to Abandon Regulation ATS Proposal Provisions Affecting Crypto Exchanges

Senate Banking Committee Approval of Nomination of McKernan to Lead CFPB

Following its February 27, 2025 hearing on the nomination of Jonathan McKernan to be director of the CFPB, the Senate Banking Committee held an executive session on March 6, 2025, at which the Committee ordered McKernan’s nomination to be reported favorably to the full Senate. The vote was 13–11, along party lines. The nomination was then placed on the Senate Executive Calendar. If approved by the full Senate, McKernan would replace CFPB Acting Director Russell Vought as director of the CFPB.

Treasury Secretary Bessent on Refocusing Banking Regulation

In a March 6, 2025 speech at the Economic Club of New York, Treasury Secretary Scott Bessent said that a goal of the Trump administration is “to make financial regulation more efficient, effective, and appropriately tailored.” To do so, the administration will “start with a fundamental refocusing of supervisors’ priorities . . . on material risk taking.” Secretary Bessent said he plans to utilize the Financial Stability Oversight Council and the President’s Working Group on Financial Markets to “drive change in our regulatory environment.”

While he said that the federal banking agencies need to “sing[] in unison from the same song sheet[,] . . . this does not mean consolidation of agencies, but coordination via Treasury, such that our regulators work in parallel with each other and industry.” In particular, Secretary Bessent called out “unduly burdensome regulatory requirements” and “unproductive reporting requirements that have little to do with reducing material financial risk.” He said the new focus of banking regulation will be “improving the efficiency and effectiveness of our financial sector to underwrite and finance domestic activity.” The Treasury Department will work on refocusing the federal banking regulatory agencies on material financial risks, but will not work toward consolidation of the agencies. Secretary Bessent emphasized the importance of the federal banking agencies taking a unified approach to regulation, and said that coordination in this regard will be facilitated by the Treasury Department.

White House Executive Order on Strategic Bitcoin Reserve and Digital Asset Stockpile, Digital Assets Summit

On March 6, 2025, President Trump signed an Executive Order establishing a Strategic Bitcoin Reserve and a U.S. Digital Asset Stockpile, as well as directing the Treasury Secretary to establish an office to administer the accounts. The Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile would include bitcoin and other digital assets, respectively, from criminal or civil asset forfeiture proceedings. The Executive Order calls for the secretaries of the Treasury and Commerce Departments to develop budget-neutral strategies to obtain additional bitcoin for the Strategic Bitcoin Reserve but prohibits any purchase of other digital assets for the U.S. Digital Asset Stockpile.

The Executive Order requires all agency heads to account for any digital asset ownership to the Treasury Secretary and the President’s Working Group on Digital Asset Markets. The Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile are intended to “resolve the current disjointed handling of cryptocurrencies” across federal agencies.

On March 7, 2025, the White House held a Digital Assets Summit with digital asset CEOs, advocates, and investors. In remarks at the Summit, President Trump pointed to his administration’s work in ending regulators’ “war on crypto” and expressed his support for legislation establishing a regulatory framework for digital assets.

OCC Reaffirmation of Bank Authority to Engage in Certain Crypto-Asset Activities

On March 7, 2025, the OCC issued Interpretive Letter 1183 (the “Letter”) reaffirming the authority of national banks and federal savings associations (collectively, “federal charters”) to engage in certain crypto-asset activities. Specifically, the Letter confirms that the crypto-asset custody, distributed ledger, and stablecoin activities discussed in prior OCC interpretive letters (i.e., Interpretive Letters 1170, 1172, and 1174) are permissible. In the Letter, the OCC rescinded Interpretive Letter 1179 (November 2021), which required notification to, and written supervisory non-objection from, the OCC before the federal charters could engage in cryptocurrency activities.

The Letter emphasizes that federal charters are required to conduct crypto-asset activities “in a safe, sound, and fair manner and in compliance with applicable law.” In addition, the Letter states that new activities should be “developed and implemented consistent with sound risk management practices and align with [federal charters’] overall business plans and strategies.”

OCC Workforce Reduction from Administration Buyout Offer

According to press reports, approximately 140 OCC employees have accepted the administration’s “deferred resignation” buyout offer. Under the offer, which was made to all federal employees and is now closed, those who accepted the buyout offer will be placed on administrative leave and stay on the federal payroll through this fiscal year, which ends on September 30, 2025. The OCC terminated a number of probationary employees last month. All federal agencies have until March 13, 2025 to develop reorganization plans that include additional workforce reductions.

SEC Acting Chairman Uyeda’s Direction to Staff to Determine How to Abandon Regulation ATS Proposal Provisions Affecting Crypto Exchanges

In a speech on March 10, 2025, SEC Acting Chairman Uyeda said that he has directed staff to review options to abandon provisions of a Regulation ATS proposed rule that would broaden the definition of “alternative trading system” (ATS) to include crypto exchanges. In 2022, the SEC, under former Chair Gensler, published a revised proposed rule that would define “exchange” to include “communication protocol systems.” This would expand Regulation ATS to cover certain protocols used with crypto assets. The revised proposed rule remains pending.

In his speech, Uyeda said that, because of “significant negative public comment” on the expanded exchange definition, he has asked SEC staff for options to abandon that part of the proposal. He said he also has asked SEC staff to re-engage with the Treasury Department, Federal Reserve, and market participants to determine whether other proposed regulatory changes for government securities ATSs should move forward.

For more details on any of these developments, or to discuss how these changes may impact your business, please reach out to our team. Stay tuned for next week’s update, where we will continue to bring you the latest in federal financial services regulatory and related developments.

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