Main Points :
- Urgency of Adoption: Traditional banks that fail to integrate blockchain and decentralized finance (DeFi) risk becoming obsolete within ten years.
- Critique of Legacy Systems: Current financial infrastructures like SWIFT are criticized as “broken,” “slow,” and excessively costly.
- DeFi Advantages: Blockchain-based systems offer near-instant, low-cost peer-to-peer transfers without intermediaries.
- Political & Social Dimensions: Crypto is framed as a tool against systemic exclusion and politicization of traditional banking.
- Emerging Industry Momentum: Major players—from JP Morgan’s JPM Coin to fintech giant SoFi’s planned crypto re-entry—signal growing institutional embrace.
A Crisis of Confidence in Legacy Banking
In an interview with CNBC on April 30, 2025, Eric Trump—Executive Vice President of the Trump Organization and son of President Donald Trump—unequivocally warned that “the modern financial system is broken, it’s slow, it’s expensive,” and that without embracing blockchain technology, “banks will be extinct in ten years”. His scathing assessment targeted not only the cost and latency of services but the rigidity of centralized intermediaries that dominate global payments. He called out SWIFT—the interbank messaging network trusted for decades—as “an absolute disaster,” arguing that private blockchains and public networks alike can replicate and improve every function SWIFT provides, but faster and cheaper.
Decentralized Finance: Speed and Cost Efficiency
Eric Trump lauded decentralized finance platforms, which allow users to move assets from wallet to wallet with negligible fees and near-instant settlement. “Open a DeFi app right now, and you can send value instantly with zero volatility and zero cost,” he explained, contrasting this experience with the typical multi-day wire transfer that often incurs fees upward of $30 per transaction. DeFi networks achieve this by replacing centralized clearinghouses with distributed consensus protocols—validating transactions across nodes rather than routing through a handful of correspondent banks. This model not only reduces counterparty risk but also democratizes access: anyone with an internet connection can participate without credit checks or minimum balances.
Political Weaponization Fuels Crypto Interest
Beyond operational critiques, Trump framed his crypto advocacy as a response to what he calls the “weaponization” of banking against average Americans and political dissenters. He recounted discovering that “the banking system was being used against people who didn’t hold immense wealth or who wore MAGA hats,” prompting his deeper involvement in crypto ventures such as the USD 1 stablecoin project he co-launched with his brother Donald Jr. In Trump’s view, decentralized networks insulate financial services from political interference, providing an alternative for those marginalized by traditional institutions.
Institutional Experimentation: From JPM Coin to Central Bank Digital Currencies
It’s not only fringe fintech firms embracing blockchain. For years, global banks have run pilot programs exploring tokenized assets, cross-border payments, and identity solutions on private ledgers.
- JPM Coin: Launched by JPMorgan in 2020, this permissioned stablecoin facilitates instantaneous settlement between institutional clients, reducing intraday credit exposure.
- Project Stella: A joint research between the European Central Bank and Bank of Japan investigating interoperability between wholesale and retail CBDCs.
- HSBC’s FX Settlement Trials: Using the Contour platform built on Corda to streamline foreign exchange confirmations.
These initiatives demonstrate that blockchain’s value extends beyond speculative tokens, addressing real pain points in liquidity management, reconciliation, and regulatory reporting.
Regulatory Shifts Under the Trump Administration
According to industry observers, the regulatory environment is growing more permissive. Under President Trump’s administration, key regulators such as the Office of the Comptroller of the Currency (OCC) have signaled openness to bank-chartered crypto activities. In March 2025, the OCC issued new guidance clarifying that nationally chartered banks may custody and issue stablecoins, provided they meet existing safety and soundness standards. This “fundamental shift,” as SoFi CEO Anthony Noto described it, has emboldened institutions to plan broader crypto offerings.
SoFi’s Imminent Crypto Comeback
Fintech leader SoFi provides a case study in the evolving landscape. After suspending crypto services in 2023 to secure its bank charter, SoFi announced on April 29, 2025, plans to re-enter the cryptocurrency market by year-end . CEO Anthony Noto highlighted that new OCC guidance removes previous barriers, allowing SoFi to “make a bigger, more comprehensive push into cryptocurrency,” embedding blockchain capabilities across lending, saving, spending, and investing products. The re-entry timeline spans the next six to 24 months, signaling confidence that regulated banks can safely integrate crypto services under clear supervisory frameworks.
Mainstream Financial Institutions Follow Suit
Alongside SoFi, other major banks are signaling deeper crypto engagement:
- Bank of America and Morgan Stanley have reportedly formed internal committees to evaluate digital asset strategies, exploring everything from custody solutions to tokenized debt issuance.
- Goldman Sachs relaunched its crypto trading desk in early 2025, focusing on institutional market-making for Bitcoin and Ether futures.
- Vanguard and BlackRock began submitting SEC filings for spot Bitcoin ETFs in late 2024, reflecting investor demand for regulated access.
This convergence suggests a tipping point: what was once a fringe sector is now on the radar of every financial giant seeking competitive differentiation and revenue diversification.
Risks and Considerations
Despite the enthusiasm, significant challenges remain:
- Cybersecurity Threats: As DAOs and smart contracts proliferate, vulnerabilities can lead to multi-million-dollar exploits. Robust auditing and insurance solutions are imperative.
- Regulatory Fragmentation: Global inconsistencies in KYC/AML standards and securities classifications risk creating compliance bottlenecks. Harmonization efforts by the FATF and BIS are ongoing but incomplete.
- Scalability Constraints: Public blockchains like Ethereum face throughput limits without Layer 2 scaling or migration to proof-of-stake, which comes with its own trade-offs.
Banks venturing into crypto must balance innovation with these operational and legal safeguards to avoid reputational or financial setbacks.
A Decade to Transform
Eric Trump’s stark prognosis—that banks face extinction within ten years if they ignore blockchain—underscores a broader reality: the financial industry is at an inflection point. Decentralized technologies offer transformative potential in speed, cost, and inclusivity. Early adopters—from JPM Coin experiments to SoFi’s crypto re-entry—are pivoting to capture emerging markets and meet evolving consumer expectations. Yet the path forward demands vigilant risk management, regulatory coordination, and technological scalability. Institutions that navigate these complexities can unlock new revenue streams and resilience; those that balk may indeed find themselves left behind in the next era of digital finance.
