Crypto-First Banks Are Coming To Shake Up The Banking World

Crypto banks look set to redefine the banking sector in 2025
The Federal Reserve is the latest U.S. regulator to clear the path for crypto banking to enter the mainstream, so let’s take a look at where the market stands and how it might evolve.
One of the implications of the pro-crypto policies pursued by the Trump administration is that the banking sector is positioned to undergo a transformation via both the expansion of crypto friendly banks as well as the launching of multiple crypto-native banks. As of this writing the only federally chartered crypto operating in the U.S. is Anchorage Digital Bank NA, with other efforts such as those launched previously by Paxos National Trust and Protego National Trust having faced obstacles at the federal level. One other institution of note is FV Bank, which operates as a U.S. licensed digital bank, providing a platform where clients can manage both traditional USD accounts and cryptocurrencies. FV Bank services encompass digital asset custody, traditional banking services like payments, and support for various stablecoins.
Even in face of state-based efforts such as in Wyoming the regulatory outlook has remained challenging since cryptoassets first became a mainstream financial markets topic; these icy market conditions seem set to finally begin thawing. To understand the importance of such developments in the U.S. banking industry crypto investors and advocates would be well served to reflect on how crypto banking hopefuls were treated in the past. One notable example is the ongoing legal battle between Custodia and the Federal Reserve, following multiple denials for inclusion in the Federal Reserve system despite substantial efforts by the firm to satisfy previously stated requirements. Despite these setbacks, in March 24 the firm partnered with Vantage Bank to tokenize U.S. dollar demand deposits on Ethereum via ERC-20; the appetite and interest in tokenized payments continues to accelerate.
In short the U.S. banking landscape has proven to be difficult, if not outright hostile, to crypto-native institutions, but this has not stopped innovation and the creativity in the space. As this outlook continues to pivot to a more hospitable one, let’s take a look at what this means for crypto investors going forward.
More Yield Generating Crypto Instruments
One of the missing pieces of the cryptoasset ecosystem has been the lack of ability for investors to generate yield from investments and/or holdings. Notable collapses and potentially fraudulent activity that have occurred at various DeFi and stablecoin protocols in the past have not helped in the effort to develop legitimate options for investors. Most recently, Resolv Labs closed a $10 million seed round to not only expand a crypto-native yield platform utilizing the USR stablecoin, which amplifies the influence of the $450 DeFi protocol of the same name.