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| MARKETS — as of Oct 6, 6:24 AM ET |
Equity futures S&P7,843+0.21% Nasdaq31,423+0.34% Dow51,775+0.42% Rates 2-Year4.81%-2 bps 10-Year5.28%-3 bps SOFR3.88%+1 bps Credit & risk High Yield3.10%-14 bps Crude87.68-1.96% Bitcoin$86,106+0.37%
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Tuesday, October 6 · Lead FinCEN withdraws crypto rulemakings on digital-asset reporting and currency mixing FinCEN withdrew two crypto rulemakings effective October 6, removing two sets of reporting duties banks would have carried on digital-asset flows. The December 23, 2020 proposal would have required banks and money services businesses (MSBs) to report transactions over $10,000 involving unhosted wallets, with records kept above $3,000. The October 23, 2023 proposal would have named convertible virtual currency (CVC) mixing a class of transactions of primary money laundering concern under section 311 of the USA PATRIOT Act; FinCEN now cites lawful users' interest in privacy on public blockchains. It will take no further action on the 2020 proposal. | ▸ | What leaves the compliance plan: The mixer proposal would have had banks report wallet addresses, transaction hashes, IP addresses or narrative descriptions for mixing activity. The 2020 proposal would also have required identity checks on customers sending to unhosted wallets. Both were proposals, so no rule in force changes; systems work built for either can stop or be redirected. FinCEN tied the move to the President's Working Group report of July 2025, issued under Executive Order 14178. Both withdrawals publish in the Federal Register today. |
| ▸ | The CFTC's crypto rulebook, same week: The CFTC published an advance notice of proposed rulemaking (ANPR) on October 5 announcing its intent to write two rules, Regulation Crypto Asset Transactions and Regulation Crypto Asset Markets, for retail commodity transactions in crypto assets under section 2(c)(2)(D) of the Commodity Exchange Act. American Banker described it as a request for industry feedback on federal rules for leveraged crypto markets. Benjamin Schiffrin, director of securities policy at Better Markets, said the CFTC and the SEC are competing to be the industry's biggest cheerleader. An ANPR binds no one. The notice states no comment deadline. |
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REGULATORY DEVELOPMENTS Two more firms asked the OCC for national trust charters in the days after community bankers took the agency to court over them. The Fed sent an interagency statement on core providers to its examiners; it also cleared one holding company application while another applicant publicly faulted it. The SEC set a December 7 deadline on two adviser proposals. | ▸ | Trust charter filings after the lawsuit: Modern Treasury, the payments infrastructure company, applied to the OCC to establish Modern Treasury National Trust Bank, a limited-purpose trust bank for stablecoin plus fiat custody. Rain filed separately to form Rain National Trust Bank for stablecoin payments. Both filings come days after the Independent Community Bankers of America (ICBA) sued the OCC on October 2 in the U.S. District Court for the District of Columbia, arguing the agency lacks authority to grant crypto firms these charters. A national trust bank is uninsured, takes no deposits and makes no loans. A charter would not make either firm a permitted payment stablecoin issuer. These are applications; the OCC has acted on neither. |
| ▸ | Core providers, now with examiners: The Fed issued SR 26-7 on October 5, directing Reserve Banks to distribute the September 11 joint statement from the Fed, FDIC and OCC on community banks' engagement with core service providers to supervised institutions and examination staff. The statement says a few large providers hold much of the core market, which limits community banks' leverage over due diligence information, contract terms or monitoring. The agencies also state they may use supervisory or enforcement authority where a core provider engages in unsafe practices, or causes a bank to. SR 26-7 sets no compliance date for banks. |
| ▸ | Call Reports at the 8 percent ratio: The FDIC told insured institutions on October 5 that third-quarter Call Report instructions reflect the April 29 capital rule (91 FR 22973). That rule lowered the community bank leverage ratio (CBLR) requirement from 9 percent to 8 percent; it also lengthened the grace period from two quarters to four. No data items were added. The report covers the quarter ended September 30. |
| ▸ | Fed applications, two outcomes: The Federal Reserve Board announced its approval of an application by Isabella Bank Corporation on October 5; the announcement as circulated does not describe the transaction. Old Glory Bank, meanwhile, raised $8 million and still plans to go public, though in a way that bypasses Fed approval, American Banker reported. Its chief executive said the Fed failed to approve its recent application because the bank is pro-crypto. Old Glory says the money came from Main Street investors. |
| ▸ | Private credit loans under review: Semafor reported that the Federal Reserve Bank of New York has been visiting large banks to review their loans to private credit firms. No findings or supervisory actions have been reported. The New York Fed has issued no statement. |
| ▸ | Preemption petitions, a call for the government's view: The Supreme Court on October 5 neither granted nor denied the three bank preemption petitions, Cantero v. Bank of America (No. 25-1313), Flagstar Bank v. Kivett (No. 25-1350) and Citizens Bank v. Conti (No. 25-1004). In each, it invited the Solicitor General to file a brief expressing the views of the United States, the Court's dockets show. The question of how far state law reaches national banks stays open until that brief is filed. |
| ▸ | Adviser fees and the accredited test: The SEC's proposal to amend Rule 205-3, publishing today, would let registered investment advisers charge performance fees to registered funds plus business development companies (BDCs), subject to conditions. It would also widen "qualified client" to anyone meeting Regulation D's accredited investor definition, so the credentials the SEC floated on October 5 for accredited status could open performance-fee products as well. Banks with adviser subsidiaries sit on both dockets. The SEC's crypto custody proposal, which would let advisers use state trust companies, now carries the same deadline. Comments on both close December 7. |
INDUSTRY AND AI SIGNALS | ▸ | Long yields, Japan in view: The 10-year Treasury yield was 5.28 percent early Tuesday, down about 3 basis points, while the 2-year stood at 4.81 percent. Reuters' Morning Bid said long-term yields sit at their highest since 2002 as rising Japanese yields raise the prospect of investors bringing money home from U.S. and French bonds. The high-yield spread, the premium risky borrowers pay over Treasuries, narrowed about 14 basis points to 3.10 percentage points; crude fell about 2 percent to near $88 a barrel. France's central bank governor, Emmanuel Moulin, warned that interest rates risk strangling the country, the Financial Times reported. SOFR, the overnight funding rate, stood at 3.88 percent. |
| ▸ | Anthropic's chip loan hits the market: Wall Street banks launched syndication of a record $60 billion financing package for Broadcom and Anthropic, the Financial Times reported, calling it a test of lending appetite. For lenders the deal is credit exposure to the AI build-out, placed into a market the FT describes as worried about mounting AI debt; for institutions that run Claude in operations or customer channels, it shows how much borrowed compute sits under their provider. PitchBook said Anthropic's leaked financials show fast growth but do not support a $2 trillion valuation. Microsoft and Meta have steered staff from Claude to in-house tools, PYMNTS reported, citing The Information. Microsoft's internal Claude spend was on track for $1 billion. |
| ▸ | Deals waiting on regulators: Western Union and International Money Express have refiled with antitrust regulators after delays in their proposed merger, which could trigger a new 30-day waiting period, American Banker reported. Bank of Ann Arbor agreed to acquire Huron Valley Bancorp, expanding into suburban Oakland County, Michigan. The Michigan deal is Bank of Ann Arbor's first since 2021. |
| ▸ | Banks in the stablecoin plumbing: Anchorage Digital partnered with Standard Chartered to offer USD accounts plus Swift wires, including third-party transfers, to eligible non-U.S. institutional clients; Morgan Stanley set up a digital asset lab to test stablecoins, tokenization or decentralized finance applications. Stripe, separately, is expanding stablecoin cards, PYMNTS reported. Stripe's stablecoin cards target 100-plus countries by year end. |
POLITICAL & LEGISLATIVE Senate Democrats turned the housing finance regulator's shrinking watchdog into an oversight fight. | ▸ | FHFA's inspector general, a testimony demand: Senate Banking Committee Democrats are seeking testimony from Federal Housing Finance Agency Director Bill Pulte, who said last week that the agency will slash the budget of its inspector general, American Banker reported in a preview of coming oversight. FHFA supervises the Federal Home Loan Banks, which lend to member banks; the inspector general's office oversees FHFA itself. No hearing date was reported. |
WHAT'S COMING | ▸ | Small-bank exam cycle, eight days: The OCC's comment window on its proposal to expand the examination cycle for certain small insured depository institutions, along with U.S. branches and agencies of foreign banks, closes October 14, eight days out, with no extension recorded. Banks that would move to a longer cycle should put their view of the eligibility line on the record. |
| ▸ | TabaPay's holding company, same day: Comments are due October 14, eight days out, on TabaPay's application to become a bank holding company for Transact Bank, N.A. (91 FR 58122). It is the Fed-side step for a payments firm that would own a national bank; competitors and sponsor banks with views have until then. |
| ▸ | Swap clearing, Thursday: The CFTC's clearing determination for interest rate swaps, updated for the Canadian dollar and Mexican peso benchmark transitions, takes effect October 8, two days out. Bank swap dealers should confirm which trades in those currencies now require clearing. It applies from Thursday. |
WHAT IT MEANS | ▸ | FinCEN's withdrawal moves the wallet question into the stablecoin rulebook. Banks that built unhosted-wallet thresholds for the 2020 proposal no longer face a federal $10,000 reporting or $3,000 recordkeeping trigger, so those controls can return to judgment inside an existing risk-based program. The GENIUS Act makes a permitted payment stablecoin issuer a BSA financial institution, and FinCEN's April 10 proposal on issuer anti-money-laundering programs (91 FR 18582) has not been finalized. Today's charter applicants describe that business: Rain for stablecoin payments, Modern Treasury for stablecoin custody. Wallet-level expectations for a bank's stablecoin counterparties would come from that rulebook, not the withdrawn one. That proposal remains unfinalized. |
Dates That Matter OCT 8
2d | Effective: Clearing Requirement Determination Under Section 2 of the Commodity Exchange Act [CFTC] | OCT 13
7d | Comments close: Community Reinvestment Act Regulations [OCC] | OCT 13
7d | Watch: respondents' briefs in opposition due in *Custodia*, S. Ct. No. 26-62 [Watch] | OCT 14
8d | Comments close: Expanded Examination Cycle for Certain Small Insured Depository Institutions and U.S. [OCC] | OCT 14
8d | Watch: comments due on TabaPay's BHC application for Transact Bank, N.A. [Watch] | OCT 15
9d | Comments close: Petition for Rulemaking of Robert Michael Vanleeuwen [FTC] | OCT 16
10d | Effective: Whistleblower Award Determination [CFTC] | OCT 20
14d | Comments close: Request for Comment on the Listing of Compute Derivatives Contracts [CFTC] |
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Today's inputs
| 86 docs | 20 high priority | 42 social | 367 news |
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That's today's brief. A short note: the same engine that writes it each morning now runs inside banks and fintechs — scoped to your charter, your regulator, and your data, cited to primary text. It drafts and reviews policies, preps Call Reports, and turns what changed into what it means for us. See LexRegulator.com, or simply reply to this email.
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