Quick overview

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The White House is preparing to issue a new executive order that could change how the financial system handles digital assets by addressing banks’ bias against cryptocurrency companies.

According to a Wall Street Journal report, the directive is expected to penalize banks that refuse to serve clients, including those in the cryptocurrency industry, based on political concerns rather than real financial risk

]The order may lead to fines or other penalties for non-compliance and will instruct regulators to investigate whether such actions violate current consumer protection, antitrust, or credit laws.

Due to perceived reputational and legal risks, traditional financial institutions have been hesitant to offer services, which has long hindered the growth of legitimate crypto businesses.

The cautious stance taken by banks is often justified by anti-money laundering (AML) regulations and previous regulatory guidance, including during the Trump administration. The proposed executive order aims to foster a more inclusive financial ecosystem to correct this imbalance.

It could reduce the likelihood of sudden account closures, enhance stability in the sector, and grant crypto companies better access to banking services.

Analysts suggest it will encourage more advanced risk assessments by financial institutions and broader adoption of digital assets.

Additionally, it signals a new era of increased regulatory oversight for banks. Instead of relying on subjective biases, financial institutions will need to ensure their customer offboarding policies are based on objective risk evaluations. To adapt to these new norms, cooperation and open communication will be essential for both sides as the relationship between traditional finance and the digital asset economy evolves..