No Bailout for Crypto Act

This legislation establishes a comprehensive prohibition on federal financial assistance to various participants in the digital asset market. This includes digital asset intermediaries , digital asset service providers , distributed ledger protocols , and decentralized finance trading protocols , as well as financial service providers engaged in digital asset activities. The core purpose is to prevent the use of taxpayer funds to avert the failure or bankruptcy of these entities. Specifically, the bill denies these digital asset market participants access to emergency liquidity facilities established under section 13(3) of the Federal Reserve Act. Furthermore, it prohibits the Secretary of the Treasury from utilizing the Exchange Stabilization Fund for the benefit of any such digital asset entity. The legislation defines key terms like "blockchain" and "decentralized finance trading protocol" to clarify its scope. A crucial provision clarifies that this prohibition does not alter the Federal Reserve's existing authority to lend to traditional depository institutions under section 10B of the Federal Reserve Act. This ensures that the bill's restrictions are focused solely on digital asset-related activities and entities, without impacting conventional banking support mechanisms.