The US Federal Reserve has announced it is withdrawing two supervisory letters that had required banks to seek prior approval before engaging in crypto-asset and stablecoin activities. In parallel, the Fed, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) jointly rescinded two 2023 statements warning of risks tied to crypto exposure.
Those earlier statements had pointed to concerns such as volatility, legal ambiguity, and liquidity risks. Banks were encouraged to be wary when considering relationships with crypto firms or offering crypto-based services.
The decision reflects a broader shift under the Trump administration toward a more crypto-friendly regulatory stance. While the withdrawn guidance had aimed to contain potential instability from digital asset markets, critics had argued it stifled financial innovation.
Support
In its statement, the Fed said it will assess whether new guidance is needed to “support innovation, including crypto-asset activities.”
The withdrawal leaves banks with fewer regulatory hurdles for entering or expanding their presence in crypto markets. However, the absence of updated supervisory frameworks may also introduce uncertainty around compliance expectations.
