- Federal Reserve aligns with FDIC and OCC on crypto regulation.
- Expect increased bank engagement with crypto-assets.
- Regulatory shift may elevate U.S. institutional market activity in crypto.
In April 2025, the Federal Reserve Board withdrew prior guidance requiring U.S. banks to seek approval for crypto activities, offering more freedom in engaging with digital assets.
Regulatory Overview
The Federal Reserve’s decision to withdraw its earlier guidance aligns with similar actions by the OCC and FDIC. U.S. banking regulators now expect digital asset activities to be monitored through standard supervision, eliminating the requirement for advance notification. The move eases restrictions on American banks’ interaction with crypto-assets, including stablecoins and cryptocurrencies such as BTC and ETH. Market dynamics may shift as banks engage more freely in crypto-market operations without seeking prior regulatory approval.
The financial industry anticipates significant adjustments, especially for institutions previously constrained by stringent approval processes for digital asset engagements. Experts suggest this regulatory relaxation could catalyze innovation and greater resource allocation toward digital assets, fostering U.S. leadership in crypto finance.
“The Board is rescinding its 2022 supervisory letter establishing an expectation that state member banks provide advance notification of planned or current crypto-asset activities. … The Board will no longer expect banks to provide notification and will instead monitor banks’ crypto-asset activities through the normal supervisory process.” – Federal Reserve Press Release
Historical context reveals that past regulatory policies required stringent disclosures and approvals, which often limited banks’ participation in digital asset markets. The new guidelines reflect a shift toward embracing financial technologies while maintaining oversight through routine supervisory methods.
