The Federal Reserve has concluded its supervisory program aimed at monitoring U.S. banks involved in cryptocurrency services. The decision means banks will no longer face heightened scrutiny for offering services like crypto custody or stablecoin operations. This change reflects the Fed's increased understanding of the risks associated with cryptocurrency. Previously, in 2023, banks had to notify the Fed and adhere to strict guidelines for crypto activities. The Fed has now stated that these 'novel' services will instead be governed by the standard supervisory process. This announcement follows a trend towards more favorable regulatory conditions for the crypto industry under President Trump's administration, including the withdrawal of similar supervisory letters that limited banks' engagement with crypto. Trump's recent executive order aims to restrict the debanking of crypto initiatives, indicating a shift toward a more accommodating regulatory environment as concerns about the industry’s entanglements with traditional finance continue to evolve.

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