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Fannie, Freddie Update ROV Requirements

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Mortgage lenders who do business with the Government Sponsored Enterprises (“GSEs”) should note recent updates to their reconsideration of value (“ROV”) requirements.

 What Happened?

On September 3, Fannie Mae and Freddie Mac announced updates to their ROV requirements relating to disclosures and documentation. Specifically, Fannie Mae and Freddie Mac have updated their guidance to sellers (the Selling Guide and the Single-Family Seller/Servicer Guide, respectively) to: (a) no longer require a lender to provide an initial ROV disclosure at the time of loan application, and instead to require delivery of the disclosure with the appraisal report; and (b) no longer require a lender to retain documentation relating to the initiation of an ROV, and instead to require retention only of documentation relating to the outcome of an ROV).

Why Does it Matter?

The GSEs’ announcement follows back and forth on ROVs at the federal level. In May 2024, the Department of Housing and Urban and Development issued a mortgagee letter addressing ROV requirements; that guidance was rescinded in March of this year. The GSE announcements represent a smaller-scale reduction in the regulatory compliance obligations associated with offering ROVs to borrowers.

What To Do Now?

Our team is happy to assist lenders in reviewing their ROV processes to ensure compliance with federal agency and GSE requirements.

New York’s FAIR Act: What Financial Services Compliance Teams Must Know

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What Happened?

As we highlighted in March following its introduction, the New York’s Fostering Affordability and Integrity through Reasonable Business Practices (“FAIR”) Act represents a fundamental transformation of the state’s consumer protection framework, expanding enforcement authority beyond “deceptive” practices to include “unfair” and “abusive” acts. The FAIR Act has passed the legislature and awaits the governor’s signature.  The Fair Act will take effect 60 days following its enactment.

Legislative Changes

The FAIR Act transforms the New York’s consumer protection framework by expanding General Business Law (“GBL”) Section 349 beyond “deceptive” practices to include “unfair” and “abusive” acts. The amendments include several critical changes:

Expanded Scope of Prohibited Conduct

The GBL will now include and define three categories of unlawful business practices:

  • Deceptive practices: Under the existing standard, deceptive practices include acts that involve misleading or false representations.
  • Unfair practices: Under the FAIR Act, unfair practices include acts or practices that cause or are likely to cause substantial injury to consumers, which is not reasonably avoidable and not outweighed by countervailing benefits to consumers or competition.
  • Abusive practices: Under the FAIR Act, abusive practices include acts or practices that materially interfere with a person’s understanding of terms or conditions or take unreasonable advantage of a person’s lack of understanding, inability to protect their interests, or reasonable reliance by a person on a person engaging in the act or practice to act in the relying person’s interests.

Broader Protected Classes

The FAIR Act extends protections under Section 349 of the GBL to “businesses and non-profits as well as individuals,” recognizing that “small business or non-profit” entities need protection equivalent to consumers.

Elimination of Court-Imposed Limitations

The FAIR Act makes any prohibited act or practice under Section 349 of the GLB “actionable by the attorney general regardless of whether or not that act or practice is consumer-oriented,” overturning decades of judicial precedent that limited enforcement to consumer-facing conduct.

Enhanced Enforcement Authority

The Attorney General also gains expanded powers to bring actions against any person conducting business in New York, with broader jurisdiction and streamlined enforcement procedures. The Attorney General has the power to enjoin and seek restitution from any person conducting any business, trade or commerce or furnishing a service in New York, “whether or not the person is without the state.”

Why Does it Matter?

Federal Enforcement Vacuum

The legislation emerges as federal consumer protection enforcement has recently taken a sharp turn towards less regulation and enforcement, with states working to fill the gap left by the federal pullback. As the CFPB undergoes significant transition, certain state financial regulators and attorneys general appear poised to step into the CFPB’s shoes. New York’s legislation represents the most comprehensive state-level response to this federal retreat, potentially serving as a model for other jurisdictions. It is also worth noting that in March 2024, the CFPB, under then-Director Rohit Chopra, issued a letter to New York Governor Hochul supporting amendments to New York’s consumer protection laws to address unfairness and abusiveness.

Business Impact and Compliance Challenges

The legislation creates significant new compliance obligations for businesses operating in New York:

  • The “unfair” and “abusive” standards adopt federal concepts but apply them more broadly, creating uncertainty about compliance boundaries.
  • The law creates liability for the first time for “unfair” and “abusive” acts and practices while abrogating case law limiting the scope of the statute to allegedly consumer-oriented deception.
  • Removal of the “consumer-oriented” limitation means B2B transactions, internal business practices, and commercial relationships now face potential enforcement actions.

What Do I Need to Do?

In reviewing customer-facing and business-to-business practices against the new “unfair” and “abusive” standards, industry participants should bear in mind that the broad definitions require analysis beyond traditional deceptive practice frameworks.

First, despite federal changes, consumer protection compliance remains crucial, particularly as state enforcement intensifies. Companies should:

  • Ensure compliance policies address the broader unfair and abusive practice definitions;
  • Train personnel on the expanded standards;
  • Enhance monitoring systems for the broader range of prohibited conduct; and
  • Review and ensure documentation protocols for business practice justifications. The “unfair” standard includes a balancing test considering “countervailing benefits to consumers or to competition.” Companies should document legitimate business justifications for practices that might otherwise appear harmful.

Second, New York Attorney General Letitia James has been actively leading multistate coalitions on consumer protection issues, suggesting coordinated enforcement strategies. With CFPB enforcement curtailed, New York’s expanded authority makes the state a primary regulatory battleground. Financial institutions should expect heightened scrutiny of:

  • Fee structures and disclosure practices;
  • Lending practices and underwriting standards;
  • Customer communications and marketing materials; and
  • Digital platform interfaces and user experience design.

Third, the legislation’s focus on addressing “new and emerging technologies” suggests that companies should pay particular attention to:

  • Digital platforms and user interface design;
  • Data collection and usage practices;
  • Algorithmic decision-making processes; and
  • Subscription and recurring billing practices.

The FAIR Act represents a significant shift in the consumer protection landscape, with New York positioning itself as the primary regulatory authority as federal enforcement retreats. Businesses should assess their practices against these expanded standards while preparing for a more aggressive state enforcement environment. Other states are considering similar legislation, suggesting this may represent a broader trend requiring multi-state strategic planning. For example, California has introduced legislation to broaden its already robust and aggressive California Consumer Financial Protection Law to expand the authority of the Department of Financial Protection and Innovation to enforce consumer financial protection laws.

Companies operating in New York or considering New York operations must develop comprehensive compliance strategies that address not only the immediate requirements of the FAIR Act but also the evolving landscape of state-level consumer protection enforcement.

The elimination of traditional limitations on enforcement scope, combined with the broad definitions of unfair and abusive acts or practices, creates both compliance challenges and strategic opportunities for businesses that proactively adapt to this new regulatory environment.

Alston & Bird’s Consumer Financial Services Team is actively engaged and monitoring these developments and can assist with any compliance concerns regarding these changes to New York law.

Financial Services Advisory | FDIC Takes First Steps in Revising Supervisory Appeals Processes

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Originally published August 18, 2025 on the Alston & Bird website.

Executive Summary

Our Financial Services Team examines a proposed rule by the Federal Deposit Insurance Corporation (FDIC) that would revise its process for institutions to appeal material supervisory determinations.

  • The FDIC proposes to replace its Supervisory Appeals Review Committee with a new “independent” Office of Supervisory Appeals
  • If finalized, the proposed rule would create a clearer path to challenge exam-based supervisory findings affecting institutions’ ratings, regulatory treatment, and reputational standing
  • Public comments are due 60 days after publication in the Federal Register, with a final rule expected in early 2026

On July 15, 2025, the Federal Deposit Insurance Corporation (FDIC) proposed revising its guidelines for appealing material supervisory determinations. The Proposed Rule reflects an effort to enhance the independence, clarity, and fairness of the FDIC’s internal appeals process in response to years of criticism from regulated institutions and trade groups. If adopted, the revised guidelines would strengthen procedural protections, increase transparency, and replace the FDIC’s existing Supervision Appeals Review Committee (SARC) with a standalone office within the FDIC known as the Office of Supervisory Appeals (OSA). This proposal merits a fresh comparison to the appeals processes of the other prudential agencies: the Office of the Comptroller of the Currency (OCC) and the Board of Governors of the Federal Reserve System.

FDIC’s Current Appeals Framework

Under the FDIC’s current appeals guidelines, an FDIC‐supervised institution may seek review of any “material supervisory determination.” That term broadly covers virtually all major exam ratings and related findings, including CAMELS, IT, trust, Community Reinvestment Act (CRA), and consumer‐compliance ratings; required loan‐loss provisions; significant asset classifications; certain determination relating to violations of law; Regulation Z restitution; decisions relating to informal enforcement actions; compliance with formal enforcement actions; matters requiring board attention; and certain other supervisory determinations as may be deemed appropriate. However, formal enforcement decisions (such as cease-and-desist orders, civil money penalties, placing an institution into conservatorship, or invoking prompt corrective action) are expressly excluded and are not appealable.

Before submitting a formal appeal request, institutions are encouraged, but not required, to make a good-faith effort to resolve disputes with on-site examiners or the appropriate regional office. If issues remain unresolved, the institution may submit a written request for formal review to the appropriate FDIC division director within 60 calendar days after receiving the exam report or other written notice of the disputed determination. The division director then has 45 days to review the request and must either issue a written ruling on the points raised or refer the matter to the SARC for appellate consideration.

If the institution is dissatisfied with the division director’s decision, it may appeal to the SARC within 30 calendar days of receiving that decision. The SARC is a three‐member intra‐agency panel composed of FDIC board‐affiliated senior officials, with the FDIC general counsel and FDIC ombudsman serving as nonvoting members. The appeal must be filed in writing and include a copy of the division director’s decision and the institution’s full legal and factual arguments. The institution may also request an oral presentation before the SARC. Once an appeal is filed, the SARC independently reviews the record as of the date of the original determination – focusing on consistency with applicable laws, regulations, FDIC policy, and the overall reasonableness of the supervisory action. A hearing on the appeal must be convened within 90 days of filing, and the SARC must issue a written decision within 45 days after such hearing. The SARC’s decision is communicated to the institution in writing and is published in redacted form for precedent.

The Proposed Rule

Chief among the Proposed Rule’s changes is replacing the current SARC structure with a new OSA as the final review body. Under the Proposed Rule, an institution would first appeal a material supervisory determination to the appropriate division director in the same manner as is currently in place. If the matter remains unresolved, the OSA would hear the matter. This independent office is intended to provide a “robust, independent supervisory appeals process” that promotes impartiality and consistency. The ultimate goal of the OSA is to remove appeals decisions from the usual examination management chain and vest them in a standalone entity staffed by objective experts.

The proposed OSA would be a permanent, standalone unit of the FDIC, separate from the examination divisions. The OSA would report directly to the FDIC chairperson’s office and be granted delegated authority by the FDIC board of directors to decide appeals. Decision panels would consist of three reviewing officials, each serving a fixed term. Notably, at least one panelist must have hands-on bank supervisory experience, and, to ensure neutrality, the FDIC plans to recruit from outside its own ranks. The Proposed Rule notes that potential candidates may include former regulators, former bankers, and other industry professionals with relevant expertise. Current FDIC employees would be ineligible for these panelist roles, and appointees would serve as part-time, conflict-checked FDIC staff members bound by FDIC confidentiality rules. The FDIC expects the OSA will be fully staffed and operational as soon as the Final Rule is issued and will replace the SARC as the final appeals forum.

Procedurally, the Proposed Rule otherwise mirrors the existing appeals framework. While an appeal would still originate with the division director, any further appeal would go to an OSA panel. The OSA will then conduct a new review of the contested determination. Like the division director, the OSA must assess the matter solely on legal and policy consistency and “the reasonableness of the support” offered for each side’s position. Importantly, the Proposed Rule explicitly instructs the OSA not to defer to the original examiner’s or the institution’s preferred outcome. By spelling out a nondeference standard, the Proposed Rule underscores that appeals are to be decided independently on their merits.

The FDIC’s ombudsman will continue to have a neutral oversight role under the new rules. As before, the FDIC ombudsman will serve as a nonvoting participant who liaises between the FDIC and appellant institutions; however, under the Proposed Rule, the FDIC ombudsman may submit written views to the appeals panel for its consideration and is tasked with monitoring for examiner retaliation.

FDIC leadership emphasizes that the reforms are intended to make the appeals process more independent, apolitical, and consistent. By staffing the OSA with external, term limited officials, the FDIC expects to attract impartial reviewers who have no ongoing career incentives tied to specific supervisory divisions. This “standalone entity” approach allows reviewers to devote their full attention to appeals cases, rather than juggling multiple FDIC duties. The inclusion of former bankers and regulators on appeal panels is meant to ensure that each panel has deep practical knowledge of banking, improving the quality and consistency of decisions. Collectively, these changes aim to reduce any perception of bias (for example, examiners reviewing one another) and to foster uniformity in how policies are applied across regions.

If finalized, these revisions would provide institutions with a clearer and more robust path to challenge exam-based supervisory findings that may affect ratings, regulatory treatment, and reputational standing. Public comments are due 60 days after publication in the Federal Register, with a Final Rule anticipated in early 2026. The promulgation of the Proposed Rule also invites comparisons with similar frameworks maintained by the OCC and the Federal Reserve, both of which have implemented mechanisms aimed at providing independent, impartial review of supervisory determinations.

Appeals at the OCC

The OCC has long maintained an informal appeals process, through the OCC’s supervisory officers, and a formal appeals process through its Office of Enterprise Governance and the Ombudsman or the deputy comptroller. Similar to the Proposed Rule, the OCC ombudsman is housed within the OCC but operates separately from the agency’s supervisory chain of command.

Institutions supervised by the OCC may appeal examination ratings, determination on the adequacy of allowance for credit losses, individual loan ratings, violations of law, Shared National Credit decisions, fair-lending decisions, licensing decisions, and material supervisory determinations in matters requiring attention, compliance with enforcement actions, or other conclusions in a report of examination. Generally, once an institution determines to appeal a decision, the institution may submit an informal appeal to the appropriate OCC supervisory office. Any informal appeal must be submitted within 10 days of receiving a final written agency decision. Once filed, the supervisory office then has 10 days to issue a written appeals decision. If the institution does not agree with the supervisory office’s determination, the institution may seek further resolution through the OCC’s formal appeals process.

Under the formal appeals process, an institution may submit an appeal to either the deputy comptroller or the OCC’s ombudsman. In both cases, the appeal must be submitted within 60 days of receiving the final written agency decision giving rise to the appeal.

If an appeal is filed with the deputy comptroller, the deputy comptroller will review whether the subject decision is appealable and solicit an appeal response from the applicable supervisory office. The deputy comptroller may then engage in discussions with the institution, request supplemental information, and consult with independent OCC staff. Once the review is completed, a final written decision is typically issued by the deputy comptroller within 45 days. If an institution disagrees with the deputy comptroller’s decision, the institution may further appeal the matter to the OCC ombudsman. This second-tier appeal must be submitted to the OCC ombudsman within 15 days of receiving the deputy comptroller’s decision letter. Upon receipt, the OCC ombudsman will review any material considered in the appeal response, including information submitted by the institution at the time of the appeal or any other information considered in making the appeal decision and may seek additional information from the appellant institution. As with the initial appellate decision, the OCC’s ombudsman will generally issue a response to the second-tier appeal within 45 days of acceptance.

If the appeal is filed directly with the OCC ombudsman, rather than seeking an initial determination from the deputy comptroller, the OCC ombudsman will determine whether the subject decision is appealable within seven days of receipt. If the decision is appealable, the supervisory office will submit an appeal response to the OCC ombudsman within seven days of the OCC ombudsman’s acceptance of the appeal. The OCC ombudsman may then engage in discussions with the institution, request supplemental information, and consult with independent OCC staff. In certain cases, the OCC ombudsman may order an independent reexamination, conducted by examiners who were not involved in the original review. Once the review is completed, a final written decision is typically issued within 45 days. Notably, if an appeal is filed directly with the OCC ombudsman, the institution is not eligible for a second-tier review.

As with the Proposed Rule, the OCC’s appeals policy requires the publication of anonymized appeals proceedings and prohibits retaliation against institutions that file appeals.

Federal Reserve Appeals

Under the Federal Reserve’s appeals framework, institutions are generally encouraged to raise concerns directly with Reserve Bank or Federal Reserve Board staff and resolve disagreements before beginning a formal appeal. Unlike the OCC’s informal framework, the Federal Reserve’s informal resolutions process does not have set timelines or procedural requirements; rather, institutions and regulators are expected to act in good faith. Despite the lack of procedural requirements, during this informal resolution process, institutions may contact the Federal Reserve’s ombudsman for confidential assistance and guidance.

If informal efforts do not resolve the relevant issues, the institution may submit a formal written appeal to the Fed’s ombudsman within 30 calendar days of receiving the supervisory determination. Under the Federal Reserve’s appellate process, institutions may appeal any “material supervisory determination” including material determinations relating to examination or inspection composite ratings, material examination or inspection component ratings, the adequacy of loan loss reserves and/or capital, significant loan classification, accounting interpretation, matters requiring attention or immediate attention, CRA ratings (including component ratings), and consumer-compliance ratings. Upon receipt, an initial review panel is appointed by the appropriate Federal Reserve division director. This initial panel consists of three Reserve Bank employees not involved in the original determination and an attorney adviser. The initial panel reviews the record independently, without deference to prior findings, and may meet informally with the institution. Following a review of the record, the initial panel issues a written decision within 45 days.

If the institution disagrees with the initial panel’s decision, it may request a final review by submitting written notice to the Fed’s ombudsman within 14 days. A final review panel composed of at least three Federal Reserve Board employees, including at least one who is a Federal Reserve associate director or higher, and an attorney adviser will then assess the appeal. This final panel reviews only the record from the initial appeal and applies a “clear error” standard of review. No new evidence may be submitted, but the final panel may determine in its discretion to have an informal appeal meeting at which a representative of the institution or counsel may appear personally to make an oral presentation to the final panel. Following a complete review, the final panel issues its written decision within 21 days of the request.

Unlike the OCC process (but similar to the Proposed Rule’s), the Fed’s ombudsman plays a procedural support role as opposed to a decision-making role. The Fed’s ombudsman advises institutions on how to navigate the process and serves as a confidential point of contact for retaliation concerns. While the ombudsman does not decide appeals, their involvement is intended to provide a valuable safeguard for preserving institutional independence and trust in the process.

Strategic Considerations and Industry Outlook

Supervisory appeals processes across all three federal banking agencies are critically important because they typically represent an institution’s sole administrative remedy. Judicial review of supervisory ratings is generally unavailable unless a finding is incorporated into a formal enforcement action or final agency order. Absent that, courts routinely hold that ratings decisions, and determinations on CAMELS, CRA, and IT assessments, are nonfinal agency actions and therefore ineligible for review under the Administrative Procedure Act.

As a result, institutions facing adverse examination findings must treat the appeals process as their only opportunity to create a formal record, present factual and legal rebuttals, and seek modification or reversal of supervisory conclusions. Additionally, exam findings and related requirements are not stayed as a matter of course when the determinations are appealed. If an institution desires the effects of a determination to be stayed, the institution must formally request action be taken.

The Proposed Rule and an anticipated shift in supervisory focus may encourage greater industry pushback on agency discretion, and banks may be more inclined to challenge material supervisory determinations that impact their growth, capital planning, or reputational profile. These appeals may also be strategically used to preserve a favorable standing ahead of potential mergers or capital offerings.

Nevertheless, appealing a supervisory determination carries certain risks. Institutions must carefully consider the potential impact on their ongoing supervisory relationship, the strength of their factual record, and the likelihood of success based on prevailing agency precedent. For that reason, early preparation is essential – banks should engage legal counsel at the examination stage, ensure contemporaneous documentation of examiner interactions, and begin preparing a factual narrative that supports potential appeal arguments.

If adopted as proposed, the Proposed Rule represents a meaningful shift in the FDIC’s appeals process. If finalized, the revisions would provide institutions with greater transparency and independence. While internal agency appeal remains a nonpublic and nonlitigious process, its significance cannot be overstated, particularly given the limited availability of judicial review.

While the Proposed Rule is not expected to be finalized until 2026, in the interim, regulated institutions should evaluate internal policies for addressing examination disputes, consider designating escalation teams within legal or compliance functions, and familiarize themselves with the appeals frameworks across all three federal banking regulators.

If you have any questions, or would like additional information, please contact one of the attorneys on our Financial Services team.

You can subscribe to future advisories and other Alston & Bird publications by completing our publications subscription form.

Texas Commercial Sales- Based Financing Law Poses Unique Challenges to Financial Services Industry

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What Happened?

Following the path of nine other states that have enacted laws to regulate commercial non real estate secured financing, on May 28, 2025, the Texas legislature passed a “commercial sales-based financing” bill, known as House Bill 700[1], and the Governor Greg Abbott signed the bill into law on June 20, 2025. Unlike other state laws that have required providers of commercial financing to make Truth-in-Lending-type disclosures to borrowers, and in some instances, register with state authorities, the Texas legislation caps the cost of “sales-based financing,” which is defined as “a transaction that is repaid by the recipient to the provider of the financing as a percentage of sales or revenue, in which the payment amount may increase or decrease according to the volume of sales made or revenue received by the recipient or according to a fixed payment mechanism that provides for a reconciliation process that adjusts the payment to an amount that is a percentage of sales or revenue.” Most provisions of the law become effective on September 1, 2025, except for the provider and broker registration requirement, discussed below, which takes effect on December 31, 2026.

Why It Matters

Notably, the Texas legislation includes a provision that prohibits sales-based financing providers from establishing a “mechanism for automatically debiting a recipient’s deposit account” unless the provider obtains and perfects a security interest in the recipient’s account with “first priority” against the claims of “all other persons.” As a practical matter, no provider is likely to meet this standard. Under the Uniform Commercial Code, a security interest in a deposit account can only be perfected by entering into a deposit account control agreement with the bank at which the account is maintained. These control agreements typically provide a creditor with lien priority against the claims of other secured creditors, but not against the claims of the bank itself. Because the claims of the bank will be superior to the claims of the sales-based financing provider, no provider would be able to satisfy the Texas requirement that the provider’s interest have priority against the claims of “all other persons.” This requirement is significant because most sales-based financing transactions require payment via automated clearing house (ACH) debit entries to the recipient’s deposit account. It is unclear whether providers will be able to devise alternative payment methods or whether such alternative payment methods will negatively impact the performance of sales-based finance transactions.

Further, the legislation amends Texas law to exclude “sales-based financing” from Texas’s usury exemption. Under the new legislation, fees and charges paid or charged under a “sales-based financing” transaction count as interest under state usury law, regardless of the amount financed. However, the legislation does not require disclosure of an APR or interest rate, and it is not clear how the interest rate of a “sales-based financing transaction” would be determined for usury purposes.

The Texas legislation requires providers who extend specific offers of commercial “sales-based financing” of less than $1,000,000 to disclose to Texas-based recipients, among other things, (1) the total amount of the financing; (2) the disbursement amount; (3) the finance charge; (4) the total repayment amount; and (5) the estimated period for the periodic payments to equal the total repayment amount under the terms of the financing.

The legislation requires financers (i.e., “providers”) and brokers of “sales-based financing” transactions to register with the Texas Office of Consumer Credit Commissioner and to renew their registrations annually by January 31. The legislation exempts from its requirements banks (specifically including out-of-state banks) and their subsidiaries and affiliates, certain companies that provide tech services to exempt entities, lenders regulated under the Farm Credit Act, real property secured sales-based financing, true (operating) leases, and certain a commercial sales-based financing agreement or commercial open-end credit plan of $50,000 or more.

Again, most provisions of the law become effective on September 1, 2025, except for the provider and broker registration requirement, which takes effect on December 31, 2026.

A person who violates the law would be subject to a civil penalty of $10,000 for each violation, but the legislation does not authorize a private right action for violations arising under the law.

What To Do Now

The Texas legislation, while part of a growing trend of augmented state regulation of commercial non real estate secured lending, is far more burdensome than other similar state laws enacted to date, and at first blush, absent an exemption, may render it extremely difficult, if not impossible, to conduct sales-based financing in Texas. Only time will tell whether lenders can devise alternative financing methods that are not ensnared by the legislation or whether the legislature amends the law.

[1] https://legiscan.com/TX/text/HB700/2025

 

President’s Working Group Declares a New Era for Digital Assets

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What Happened?

On July 30, 2025, the President’s Working Group on Digital Asset Markets released a comprehensive Digital Assets Report, outlining a national strategy for cryptocurrency and blockchain. Declaring a departure from the prior Administration’s approach, the report recommends that regulators adopt pro-innovation rules toward digital assets and blockchain technology. It addresses market structure, banking, payments, stablecoins, taxation, and anti-money-laundering (AML) measures.

The Working Group was established in the President’s January Executive Order, Strengthening American Leadership in Digital Financial Technology, which declared support for the responsible growth and use of digital assets, blockchain technologies, and related technologies across all sectors of the economy.

Why Is It Important?

The report marks a significant shift in U.S. policy, and it is designed to position the United States as a global leader in digital finance. It outlines lawful digital asset use, including self-custody rights, and promotes U.S. dollar-pegged stablecoins to strengthen dollar dominance globally (while rejecting a U.S. central bank digital currency). The recommended framework includes tools that include safe harbors, innovation exemptions, and updated tax and banking rules.

On July 31, 2025, SEC Chair Paul Atkins amplified the report’s significance in a speech, American Leadership in the Digital Finance Revolution, calling it a “blueprint to make America first in blockchain and crypto technology.” He characterized the potential of digital asset technology as a new area in the history of financial markets and said that regulatory clarity could unleash unprecedented capital formation and consumer choice.

What To Do Now?

The regulatory tide has clearly shifted for companies who wish to explore or engage in the digital asset ecosystem. As always, sound compliance and governance structures will be key as regulatory expectations evolve. Additionally, engaging with regulators and industry groups to craft safe harbors and sandbox programs will be crucial to ensure alignment with evolving regulatory approaches for AML, banking, tax, and digital identity standards.