Fintech Crypto Groups Urge Trump to Defend Open Banking Rules as Banks Push Back

A coalition of fintech, crypto, and consumer advocacy groups has intensified pressure on Donald Trump to defend open banking rules under threat from major U.S. banks. In a July 23 letter, organizations including the Blockchain Association and the Financial Technology Association argued that banks are undermining innovation by litigating to block new open banking regulations and imposing restrictive data fees on third-party apps. The letter emphasizes that financial data ownership should rest with consumers, framing open banking as essential to U.S. financial leadership and innovation [1].

The dispute centers on a 2024 finalized open banking rule allowing consumers to share financial data across platforms via secure APIs. This framework is critical for crypto on-ramps, stablecoins, and decentralized finance (DeFi) ecosystems. However, the Bank Policy Institute—a trade group representing banks like JPMorgan Chase and Bank of America—filed a lawsuit immediately after the rule’s enactment, citing security risks and unfair burdens on traditional institutions. Meanwhile, JPMorgan and other banks have begun charging fintech and crypto firms for access to customer account data, with fees escalating for payment-related services [1].

The coalition’s letter urges the Trump administration to intervene in ongoing litigation by July 29, advocating for a court ruling that confirms consumer ownership of financial data and unrestricted sharing. The outcome could determine how easily Americans connect their bank accounts to crypto exchanges, stablecoin wallets, and payment apps. Critics of open banking argue that the rules create systemic risks by enabling unregulated third-party access to sensitive data, a concern amplified by the absence of a comprehensive crypto regulatory framework in the U.S. [1].

Adding complexity to the debate, major banks are simultaneously expanding into crypto. JPMorgan recently applied to trademark “JPMD,” a blockchain-based stablecoin for institutional settlements, while Mastercard and ten U.S. banks participated in a tokenization pilot for instant settlements. This dual approach—opposing open banking while investing in crypto infrastructure—highlights a strategic tension within the banking sector. Fintech and crypto advocates view such moves as contradictory, arguing that banks seek to control innovation through regulatory barriers while capitalizing on crypto’s growth [1].

President Trump, a vocal crypto supporter, faces a pivotal test in balancing these competing interests. His administration has positioned the U.S. as a global crypto leader, with Trump explicitly stating his commitment to fostering the industry. However, the coalition’s letter underscores the need for consistent enforcement of pro-innovation policies, particularly as banks leverage legal and lobbying efforts to reshape the financial landscape. The resolution of this conflict will likely influence whether the U.S. maintains its competitive edge in digital finance or cedes ground to global peers like the UK and EU, where open banking is already established [1].

Source:

[1] [title1: Crypto and fintech groups are urging Trump to defend open banking rules] [url1: https://cointelegraph.com/news/fintech-groups-trump-open-banking-banks-crypto]

[2] [title2: Bank trade groups push back on crypto firms' bank charter pursuit] [url2: https://www.bankingdive.com/topic/regulations-policy/]