The Federal Reserve just made it a lot easier for banks to get involved in the crypto world. They’ve dropped the requirement for banks to ask permission before working with crypto businesses.
A Big Change in Policy
This is a major shift from the Fed’s previous cautious approach. It’s a win for banks wanting to work with cryptocurrencies and stablecoins (like “dollar tokens”). They don’t need special approval anymore, but will still be under normal banking supervision. This fulfills a campaign promise by President Trump to make the US more crypto-friendly. The FDIC and OCC had already made similar moves.
What Changed?
Previously, banks had to notify the Fed before
doing anything crypto-related. These rules were put in place after the crypto market saw some trouble in 2022. It seems banks rarely, if ever, got approval to work with crypto under the old rules.
New Approach: Regular Oversight
Now, the Fed will use its standard oversight process for crypto activities. They’ve also dropped restrictions on banks working with stablecoins and withdrawn from joint statements warning about crypto risks.
What This Means
This makes things simpler for banks wanting to get into the crypto space, opening up new opportunities. The Fed says they’ll still monitor risks, but through regular checks instead of special restrictions. This follows a SEC decision to reverse a rule on how banks classify crypto assets.