The Federal Reserve has terminated its supervisory program that monitored U.S. banks engaged in crypto activities. This decision allows banks offering services like crypto custody and stablecoins to operate under regular supervision instead of stricter guidelines. The program, introduced in 2023, required banks involved in fintech to inform the Fed and adhere to heightened scrutiny. The Fed's latest move comes in light of changes in the regulatory landscape under President Trump, who has promoted a more favorable environment for the digital asset industry. The previous supervisory framework arose from concerns over risks associated with crypto, notably following the FTX collapse and the failure of several banks. Trump's recent executive order aims to prevent the debanking of crypto initiatives, countering earlier regulation efforts that critics labeled as attempts to restrict growth within the crypto sector. The decision marks a significant shift in how the Federal Reserve approaches the intersection of traditional banking and innovative crypto services, reflecting an evolving stance toward digital assets.

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