Once relatively obscure, crypto has gone global. Cryptocurrency has experienced continual, rapid growth and significant price fluctuations. Between 2021 and 2022, after reaching what was then an all-time high of around $3 trillion, the market lost two-thirds of its value and fell to $800 billion. Since then, the market increased steeply again and is valued at $2.8 trillion as of April 1, 2025.
The two most widely used cryptocurrencies are Bitcoin and Ether, which, as of January 2025, represent more than 65% of the crypto market capitalization. Cryptocurrencies such as Bitcoin and Ether fluctuate in value based on market supply and demand.
By contrast, stablecoins are designed to maintain a stable value relative to a national currency or other assets. As of April 2025, the stablecoin market is valued at greater than $237 billion. As with other cryptocurrencies, stablecoins have not been widely adopted for payments and are primarily used when trading cryptocurrency. Stablecoins attempt to match their value to fiat currencies in different ways but have been known to lose their stable values.
Cryptocurrency was originally designed as an alternative to traditional banking and financial services, regulated by a patchwork of rules across various government agencies. However, in the past decade, banks have expressed interest in offering services related to cryptocurrencies and other digital assets. Further, some crypto firms have sought bank or special depository charters at the federal and state levels. This overlap has presented policymakers with a challenge in deciding whether and how crypto fits into the traditional bank regulatory regime.
