The Federal Reserve has terminated its supervisory program that monitored U.S. banks involved in crypto services. Initially imposed in 2023, this program required banks to notify the Fed and comply with strict guidelines when engaging in crypto activities, including custody and stablecoin services. The Fed indicated that its understanding of the risks associated with crypto has matured, allowing it to move these activities to a regular supervisory framework without enhanced scrutiny. This announcement marks a shift in the regulatory landscape following a series of high-profile failures in the crypto sector, including the collapse of FTX and issues faced by crypto-friendly banks. The change comes as the regulatory approach towards crypto under President Trump becomes more favorable, easing the restrictions that had previously limited banks in their involvement with digital assets. The Fed's move allows banks to better integrate crypto services into their offerings without heightened oversight, reflecting a broader acceptance of crypto operations in the traditional banking system.

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