Fed Warns Banks to Adopt Blockchain or Risk Irrelevance

Federal Reserve Vice Chair Michelle Bowman issued a stark warning to traditional financial institutions during her keynote at the Wyoming Blockchain Symposium. "Banks must evolve or face obsolescence," she declared, framing blockchain adoption as an existential imperative rather than technological curiosity.

Tokenization emerged as Bowman's central case study. The process of converting physical assets into blockchain-based digital tokens could revolutionize securities settlement, she explained, eliminating custodial bottlenecks that currently plague traditional finance. "This isn't speculation—it's operational mathematics," Bowman noted, pointing to measurable reductions in settlement times and counterparty risk.

The Fed official saved her most pointed remarks for regulatory inertia. "Caution has become camouflage for complacency," she argued, suggesting that risk-averse institutions might inadvertently cede market share to crypto-native competitors. Her prescription? Immediate experimentation with permissioned blockchain networks and digital asset custody solutions.