The Federal Reserve has discontinued a supervisory program designed to monitor U.S. banks offering cryptocurrency services. This decision reflects the Fed's enhanced understanding of the associated risks, as it outlines that banks will now fall under regular supervisory processes instead of the stricter guidelines that were previously in place. The program, initiated in 2023, required banks involved in crypto custody or stablecoin services to adhere to heightened scrutiny. The Fed's announcement follows a broader shift in regulatory attitudes under President Trump's administration, which has been favorable towards the crypto industry following a series of bank failures associated with digital assets. Previously, U.S. regulators had imposed increased oversight in response to significant events like the collapse of FTX in 2022. With this change, the Fed aims to integrate crypto activities into standard banking practices rather than treating them as an exceptional risk, signaling a potential easing of regulatory pressure on banks involved in the cryptocurrency market.

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