Citing an evolved financial landscape, the US Federal Reserve has pulled a 2023 guidance that served as a barrier preventing banks from offering crypto services. The decision signals ongoing adaptation by US regulators to the digital asset space.
The policy had required all banks under Fed supervision, regardless of insurance status, to follow a single set of rules. Its foundational idea was that activities presenting similar risks should be subject to the same regulatory scrutiny.
This created a significant impediment for uninsured banks wishing to engage with crypto, as these services were not allowed for their nationally chartered counterparts. Pursuing such lines of business invalidated their eligibility for membership within the Federal Reserve system.
In its notice, the Fed identified the guidance as outdated. The Board pointed to advancements in the sector and its own improved knowledge of innovative technologies as reasons for the change.
“Accordingly, the 2023 policy statement is no longer fitting and has been withdrawn,” the Fed stated. Caitlin Long of Custodia Bank expressed approval on a social media platform, linking the old policy directly to the prior denial of her institution’s master account request.
