The Federal Reserve has terminated a supervisory program monitoring U.S. banks involved in crypto services. Initially created in 2023, this program enforced strict guidelines for banks offering crypto custody and stablecoin services. The Fed stated that its understanding of the risks associated with crypto had improved, allowing these activities to be monitored through normal supervisory processes. This decision follows the withdrawal of two regulatory letters earlier this year, which had limited banks' involvement in crypto. The change comes amidst a shifting regulatory landscape under the Trump administration, which has shown greater receptivity to the digital asset sector compared to previous years, particularly after high-profile collapses in the crypto industry like FTX. Today's announcement reflects a broader regulatory retreat, as U.S. regulators, responding to industry pushback against earlier strict guidelines, seek to balance oversight without overly constraining crypto-related banking services.

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