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Fed Vice-Chair Michael Barr Resigns Amid Accusations of Impacting Crypto Banking Services

U.S. Federal Reserve Vice-Chair for Supervision Michael Barr has announced his resignation from the position ahead of President-elect Donald Trump’s return to the White House. His departure has sparked reactions from lawmakers and crypto industry leaders, who pointed out his controversial role in shaping U.S. banking policies concerning digital assets. A Polarizing Figure in Banking and Crypto In a January 6 release , the Fed stated that Barr would leave his post at the end of February or even earlier if the new president found a suitable successor. However, it noted that the legal scholar would remain on the seven-member Federal Reserve Board of Governors. Barr has served as the Fed’s Vice Chair for Supervision since July 2022. The office was created in the aftermath of the 2008 Global Financial Crisis to offer more transparency and accountability for the U.S. central bank’s supervision and regulation of the country’s financial system. In his time, the 58-year-old has been at loggerheads with the fledgling crypto industry, especially following his push to give the Federal Reserve the power to regulate and enforce laws against digital asset issuers in the United States. Barr once stated that the monetary authority would likely deem it “unsafe and unsound” for banks to hold crypto-assets directly on their balance sheets. Many in the industry blame that perspective for limiting the ability of U.S. financial institutions to engage with the cryptocurrency sector. Recent revelations about unredacted letters acquired from the Federal Deposit Insurance Corporation (FDIC) through legal efforts by Coinbase seem to bolster these claims. The documents allegedly show a coordinated effort to slow or halt banks’ crypto-related activities, including basic Bitcoin transactions, custody services, and crypto payments. Allegations of Overreach At a November 2024 grilling before the House Financial Services Committee, Barr and his fellow regulators were criticized by Iowa Congressman Zach Nunn, who accused them of stifling virtual currency innovations. “You’ve all engaged in an anti-crypto crusade during your time here. You have helped make the United States a second-tier place for digital assets,” said Nunn. Reacting to news of Barr’s impending exit, Wyoming Senator and crypto advocate Cynthia Lummis issued a statement alleging that the Fed governor had “illegally increased his power at the cost of Wyoming’s digital asset industry,” further accusing him of failing to uphold his responsibilities as the Vice Chair of Supervision. The Yale alumnus is the latest anti-crypto official to resign from their position following Donald Trump’s crypto-fueled victory in last year’s U.S. presidential polls. Gary Gensler, head of the Securities and Exchange Commission (SEC), announced his departure on November 21, 2024, forestalling a promise by Trump to fire him on his first day in office. Similarly, Barr has cited the “risk of a dispute over the position,” ostensibly with the incoming administration, as part of his reason for leaving. The post Fed Vice-Chair Michael Barr Resigns Amid Accusations of Impacting Crypto Banking Services appeared first on CryptoPotato . Crypto Potato

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Crypto Hawk Rostin Behnam Steps Down As CFTC Chair Amid Failing Kalshi Lawsuit

Commodities Futures Trading Commission (CFTC) Chairman Rostin Behnam will step down on January 20, 2025, amid an unresolved lawsuit against retail betting market Kalshi, the agency announced today. Behnam’s departure comes as the commission battles Kalshi over the regulator’s ban on political betting contracts, highlighting regulatory challenges in emerging financial markets. During his tenure, Behnam established himself as a staunch advocate for cryptocurrency oversight. His most notable achievement was securing a $4.3 billion settlement with crypto exchange Binance over regulatory violations. Behnam pushed for expanded CFTC authority over digital assets, arguing for clearer regulatory frameworks in congressional testimonies. Under his leadership, the agency intensified enforcement actions against crypto firms operating outside regulatory boundaries. The White House has not yet nominated a successor. Behnam’s exit raises questions about the future direction of digital asset regulation and the commission’s stance on novel financial products. Last January, Behnam said he was worried the then-recent approval of spot market Bitcoin ( BTC ) exchange-traded funds (ETFs) would “magnify” the issues surrounding digital asset markets. According to Behnam , the goal of his enforcement actions was always to protect investors. “Without a regulatory framework, without that transparency, without those tools that we typically use as regulators, you are going to continue to see this fraud and manipulation. And putting aside the legitimacy and where this technology may go and what role it might play in our economy and commerce, the internet, digital assets generally… we just have to think about things from a regulatory and consumer protection standpoint. And I think that needs to be our guiding light in terms of driving this conversation, filling these regulatory gaps and creating this framework that’s ultimately going to protect American investors.” Don`t Miss a Beat – Subscribe to get email alerts delivered directly to your inbox Check Price Action Follow us on X , Facebook and Telegram Surf The Daily Hodl Mix Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing. Generated Image: Midjourney The post Crypto Hawk Rostin Behnam Steps Down As CFTC Chair Amid Failing Kalshi Lawsuit appeared first on The Daily Hodl . Crypto Potato