The Federal Reserve has discontinued its supervisory program that monitored U.S. banks involved in cryptocurrency services. Originally established to enforce strict guidelines for banks offering crypto custody and stablecoin services, the central bank now aims to manage these activities under standard supervisory procedures. The decision reflects a deepened understanding of the risks associated with crypto, which has evolved since the program's inception. The Fed had previously required banks engaged in crypto activities to notify it and to adhere to heightened scrutiny. The move comes amid broader regulatory changes in the U.S., particularly following the failures of notable firms in the cryptocurrency sector and a shift towards a more favorable stance under the current administration. Increased regulatory attention had previously been aimed at minimizing exposure to risks stemming from crypto activities, but now, with adjustments made, banks will face regular oversight instead of specialized programs that impose more stringent rules.

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