Federal Reserve Collaborates with OCC and FDIC to Revoke Cryptocurrency Alerts for U.S. Financial Institutions

The Federal Reserve has joined its fellow U.S. banking regulators in rescinding previous crypto guidance, including the requirement for banks to obtain pre-approvals before engaging in crypto activities. Now, all three agencies — the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation included — have reversed these prior policies, leaving decisions regarding crypto matters at banks to their managers and compliance executives. In the absence of established guidance, the banking sector is anticipating new legislation from Congress to clarify the operations of the digital assets industry in the U.S.

“These actions ensure the Board’s expectations remain aligned with evolving risks and further support innovation in the banking system,” the Fed stated in its announcement regarding the change made on Thursday.

One of the various roles the Fed plays is the supervision of its state member banks, alongside its more widely recognized responsibility for monetary policy. The agency’s recent action will specifically eliminate four pieces of crypto guidance the board endorsed in 2022 and 2023, which underscored the risks to banks presented by the sector. Fed officials “will instead monitor banks’ crypto-asset activities through the normal supervisory process.”