Fed Proposal Eases Bank Capital Rules, Boosts Treasury Liquidity – Coincu

The Federal Reserve has proposed changes to capital requirements impacting large U.S. banks starting June 26, 2025. Morgan Stanley estimates these rules will release up to $185 billion in capital.

The adjustment allows for greater liquidity in the U.S. Treasury market, which may later influence cryptocurrency sectors.

Fed Rule Changes to Release $185 Billion for Banks

The Federal Reserve, under Michelle Bowman’s supervision, proposed easing leverage rules for large banks, which was approved by a 5-2 vote. This measure is expected to enhance participation in U.S. Treasury markets.

This change is set to unlock approximately $60 trillion in balance sheet capacity, potentially freeing $185 billion. The proposal aims to modify the ‘enhanced supplementary leverage ratio’ for global banks dealing with low-risk assets.

“SLR reform is the first of many capital proposals we expect over Michelle Bowman’s tenure,” wrote Morgan Stanley analysts led by Betsy Graseck: Morgan Stanley Analysis.

Crypto Impact Expected from Treasury Market Liquidity Boost

Did you know? Owners of large financial institutions have historically seen market gains following regulatory ease in the U.S., such as after the 2020 COVID-19 mitigations.

As of June 26, 2025, Ethereum (ETH) is valued at $2,423.50 with a market cap reaching $292.56 billion according to CoinMarketCap. Though ETH saw recent declines, its 60-day performance increased by 34.82%, revealing resilience amid market fluctuations across cryptocurrencies.

Economic analysts from Coincu indicate that changes in leverage ratios can indirectly affect crypto liquidity. Strategic realignment by banks could see increased lending and market activity over time, strengthening ties between traditional finance and digital assets.