The Federal Reserve’s announcement on April 24, 2025, to withdraw prior guidance and supervisory letters concerning banks’ involvement in cryptocurrency and stablecoin activities is the latest turn by US regulators under President Trump to ease cryptocurrency regulation in the United States. See our earlier posts here, here, here and here. On the campaign trail, President Trump vowed to make the U.S. the “crypto capital of the planet.” The Fed’s announcement said the Fed would work with the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) to consider whether additional guidance to “support innovation, including crypto-asset activities, is appropriate.”
Under the Biden administration, the Federal Reserve had imposed stringent supervisory expectations on banks engaging with crypto-assets and stablecoins. Key among these were:
- The 2022 supervisory letter (SR 22-6) requiring state member banks to notify the Fed in advance of any planned or ongoing crypto-asset activities.
- The 2023 supervisory letter (SR 23-8) imposing a nonobjection process for banks’ involvement with dollar tokens (stablecoins).
- Joint 2023 statements by the Federal Reserve, FDIC, and OCC warning banks about risks related to crypto fraud, consumer protection, liquidity volatility, and financial stability concerns.
These measures were designed to mitigate perceived risks such as operational safety and soundness, consumer harms, potential financial system instability, and illicit finance associated with crypto-assets.
In its April 24 announcement, the Federal Reserve officially rescinded these prior supervisory letters and joint statements, effectively removing the requirement for banks to provide advance notification or seek prior approval before engaging in crypto-related activities. The Fed’s new approach places greater responsibility on banks themselves to identify, manage, and mitigate risks related to crypto activities. This delegation to internal risk management systems signals a move away from a “prior validation” model toward one that emphasizes accountability and ongoing supervision. While the Fed’s decision eases restrictions, it does not eliminate regulatory oversight. The Fed emphasized that it will continue to monitor risks through its normal supervisory processes and expects banks to maintain safe and sound operations.
By eliminating prior notification and approval requirements, the Federal Reserve has lowered compliance barriers for banks interested in engaging with cryptocurrencies and stablecoins. This regulatory easing aligns the Fed with the OCC (see here) and FDIC (see here), which had already withdrawn similar guidance earlier in 2025. The rescinding of earlier guidance and statements reduces regulatory uncertainty that had previously deterred banks from crypto engagement.
The coming months will be critical in observing how banks adapt to this new framework and how the Federal Reserve and other agencies continue to refine crypto regulation to balance innovation with safety and soundness. This decision not only marks progress toward a more crypto-friendly banking landscape but also underscores the Fed’s role in shaping a resilient and forward-looking financial system.
