Fed governor tells bankers there’s nothing to fear in crypto payments

Federal Reserve Governor Christopher Waller told bankers and innovators this week that paying with cryptocurrencies is not scary and urged them to embrace digital assets as the next step in payment systems.

At the Wyoming Blockchain Symposium 2025, Waller said smart contracts, tokenization, and distributed ledgers are just new ways to record transactions. He rejected fears from traditional finance that digital assets bring special risks, noting that payments have always changed with new technology.

Waller tells banks crypto payments are safe to use

Waller advised banks to treat crypto payments as a regular part of how people pay for goods and services. He said financial technology has always started out as unfamiliar, but with time, become part of everyday life for people. He referred to the history of how payment cards developed and said people are now questioning stablecoins like they did the cards back then.

Waller explained that stablecoins are unique because they are tied to the U.S. dollar and can move instantly at any time of the day. These features make them highly attractive for everyday retail transactions, such as buying groceries or paying bills and international transfers, where delays and high fees have always been an issue.

He further emphasized the benefits of stablecoins, saying they can strengthen the dollar’s position worldwide. Because the coins allow people to securely hold and use U.S. dollars without direct access to physical cash or American banks, they can benefit countries with weak financial systems or unstable local currencies.

Waller reminded the audience that all payment methods have a system to record and confirm transactions, so smart contracts, tokenization, and distributed ledgers fit the same description. His message comes weeks after Congress passed the first federal law designed to provide a clear regulatory framework for stablecoin issuers, the GENIUS Act.

Waller described the legislation as a big step to help stablecoins reach their full potential by removing uncertainty and reducing the patchwork of state-level rules. He explained that regulation allows businesses and banks to plan for the future with confidence and should therefore be seen as a foundation for growth, not as an obstacle. 

Fed studies new technology to improve payments

Waller reminded the audience that the Federal Reserve has always overseen the financial system and highlighted its long history of innovating solutions that continue serving as the backbone of digital bank transfers. He stated that the Fed isn’t competing with private innovators but rather providing the guidelines for innovation to ensure stability and growth in the United States.

He also said that the Fed is researching how tokenization, smart contracts, and artificial intelligence could make payments more efficient and secure. Waller said these tools are real advances that could soon be used in everyday payment networks just like chips and mobile wallets. 

His remarks aligned with fellow Fed governor Michelle Bowman, who shared the stage at the Wyoming Blockchain Symposium and warned banks against avoiding cryptocurrency. Bowman pointed out the recent changes in Fed supervision guidelines, where the central bank removed “reputational risk” to block banks from offering crypto-related services. She urged banks to participate responsibly instead of sitting on the sidelines. 

Bowman also proposed on Tuesday that Fed employees be allowed to hold small amounts of cryptocurrency, as reported by Cryptopolitan. She argued that direct experience would help regulators better grasp the markets they oversee.

Bowman said handling digital assets firsthand would give examiners crucial insight into crypto activities at banks and financial institutions—a perspective current rules block, as Fed staff cannot own crypto.

She emphasized that real understanding comes from hands-on experience, noting that you wouldn’t trust someone to teach skiing if they had never actually skied, no matter how much they had read or written about it.

Waller and Bowman’s message showed that the Fed sees crypto as the newest form of financial innovation that will take shape in a matter of time. It also suggests that banks risk falling behind at a time when technology is moving faster than ever if they continue to resist the growing trend.