Why are established financial institutions stepping into crypto rulemaking now? The progression reflects a convergence of market maturation, regulatory momentum, and institutional interest, with JPMorgan and Franklin Templeton taking visible roles to shape frameworks that could govern widespread digital asset activity. Scott Lucas of JPMorgan was appointed co-chair of the CFTC’s Digital Asset Markets Subcommittee (DAMS), and Sandy Kaul of Franklin Templeton joined him as co-chair, succeeding a prior leader, signaling traditional finance’s deeper engagement in policy development. Both executives emphasize the need for clear, effective regulatory mechanisms that promote mainstream adoption while maintaining consumer protection, indicating a shift from passive market participation to active rulemaking influence. This focus on regulatory clarity also aims to address legal risks that have long challenged the crypto ecosystem. DAMS itself has expanded to include representatives from both crypto-native firms and established banks, creating a hybrid advisory body that offers policy advice and risk assessments to the CFTC, and the inclusion of members from Uniswap, Aptos, Chainlink, BNY, and JPMorgan reflects intent to gather broad industry expertise. The subcommittee supports initiatives to build well-structured digital asset markets, and public consultations such as the “Crypto Sprint” are designed to solicit industry feedback through October 2025, which may help inform consistent regulatory approaches. This expansion suggests regulators seek practical input on technical and market design issues, blending centralized finance perspectives with decentralized protocol insights. Wall Street’s institutional entry into crypto markets also conveys a message about market legitimacy, as large asset managers, including Franklin Templeton and JPMorgan, explore tokenization and other digital asset services, though many offerings remain contingent on regulatory approvals. Institutional involvement can reduce skepticism about market integrity and liquidity provisioning, yet it simultaneously raises questions about concentration risk and the compatibility of legacy systems with programmable assets. Global and domestic regulatory developments, from Basel crypto exposure rules to U.S. exchange authorizations, underscore a coordinated effort to balance innovation with investor protections, and caution remains warranted as frameworks and industry standards continue to evolve. New leadership consideration at the White House also highlights ongoing attention to federal oversight and the selection of candidates with crypto regulation expertise. BlackRock’s moves into tokenization and partnerships across the industry signal that tokenized assets are increasingly part of mainstream institutional strategy.
