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The U.S. Federal Reserve has withdrawn key supervisory letters that had previously discouraged banks from participating in cryptocurrency and stablecoin activities. The reversal marks a significant step toward fostering a more crypto-friendly environment under the Trump administration.
Fed Scraps 2022 and 2023 Guidance on Crypto Activities
On April 24, the Federal Reserve Board announced the withdrawal of its 2022 supervisory letter that required state member banks to provide advance notification of any crypto-related activities. Simultaneously, it rescinded its 2023 letter that restricted bank involvement in stablecoin-related services.
“Crypto-related activities will now be supervised through the Federal Reserve’s standard oversight process,” the Board stated, removing a major hurdle that had previously deterred financial institutions from entering the digital asset sector.
The original guidance had warned of potential risks to financial stability, citing concerns around consumer protection, fraud, and systemic threats from the widespread use of stablecoins. Crypto assets were also flagged for their association with illicit activities such as money laundering and terrorism financing.
Also Read: Federal Reserve Endorses BFT Consensus: A Game Changer for XRP, XLM, and HBAR
Regulatory Reversal Signals Broader Policy Shift
The Fed’s policy reversal is part of a broader rollback of anti-crypto measures. Alongside the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC), the central bank also withdrew 2023 joint statements cautioning banks against working with crypto firms that might be engaged in fraud or misleading practices.
This shift aligns with the Trump administration’s broader efforts to support digital innovation and make the U.S. more competitive in the global crypto economy. Earlier this year, the SEC revoked a controversial rule that required banks holding crypto assets to list them as liabilities—another move aimed at removing barriers to crypto adoption within the traditional banking system.
With these regulatory withdrawals, U.S. banks may find new freedom to explore digital asset services and stablecoin projects, potentially unlocking a new era of mainstream crypto integration and innovation across the financial sector.
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