- Fed ends 2022 and 2023 supervisory actions on banks regarding crypto-related actions.
- This move follows the FDIC and OCC removing similar restrictions, easing crypto operations.
- Old guidance required banks to notify in advance and cautioned about risks in crypto assets.
In a significant move for the US cryptocurrency landscape, the Federal Reserve Board announced on Thursday that it is withdrawing its restrictive guidance on banks’ crypto-asset and dollar token activities. This move signals a more open regulatory environment for banks engaging with digital assets.
According to the Fed’s press release, the now-restricted guidance stems from a 2022 supervisory letter and two joint statements issued in January 2023 by the Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC).
Previously, these guidelines required state member banks to notify the Federal Reserve ahead of time about any crypto-related activities and cautioned holding cryptocurrencies like Bitcoin on their balance sheets. They also warned about liquidity risks and market vulnerabilities that come with crypto assets. However, with the Federal Reserve’s recent announcement, these requirements have now been removed. Instead, the Fed will monitor banks’ crypto activities through normal regulations.
Source: federalreserve.gov
The Federal Reserve’s move comes after the FDIC announcement on March 28, 2025, wherein FDIC-supervised banks were given the green light to engage in crypto-related activities without needing prior approval, as long as they handle the risks efficiently. Similarly, the OCC reversed its 2022 guidance, confirming that activities like crypto custody and stablecoin operations are now allowed for national banks.
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This news attracted widespread bullish sentiment from the crypto community. Michael Saylor commented on this by quoting the Federal Reserve’s tweet, where he said, “Banks are now free to begin supporting Bitcoin”.
The Fed’s policy reversal shows how fast traditional finance is embracing crypto. In just 18 months, we’ve seen ETFs, futures, and now banks allowed to custody crypto as a strategic reserve asset. Overall, the Federal Reserve’s decision to withdraw crypto-unfriendly guidance marks a turning point for the US financial system and its integration with digital assets.
