Key Supervisory Letters Rescinded as Trump-Era Crypto Policy Shifts Take Shape
The U.S. Federal Reserve has officially withdrawn crypto-related supervisory guidance that had previously discouraged banks from participating in digital asset and stablecoin activities.
In an April 24 statement, the Fed said it is rescinding its 2022 supervisory letter that required state member banks to provide advance notice before engaging in crypto activities. A similar letter issued in 2023, which specifically restricted bank participation in stablecoin projects, has also been revoked.
“Crypto-asset activities will now be monitored through the Federal Reserve’s normal supervisory processes,” the central bank said.
This policy shift marks a significant regulatory pivot under the administration of President Donald Trump, which has pledged to make the U.S. more crypto-friendly.
Fed Eases Back from Cautionary Tone
The now-rescinded letters were originally issued to address risks to financial stability, consumer protection, and the soundness of the banking system. The Fed had warned that widespread adoption of certain crypto assets — particularly stablecoins — could lead to “destabilizing runs” or payment system disruptions.
The guidance also cited crypto’s alleged links to money laundering and terrorist financing as reasons for heightened scrutiny.
However, as the Fed clarified this week, oversight of crypto-related activity will now fall under standard supervisory channels, eliminating the need for advance bank disclosures specific to digital asset activity.
Joint Warnings on Crypto Fraud Also Repealed
The Fed, alongside the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC), also announced the withdrawal of two 2023 joint statements that warned banks about potential fraud risks when dealing with crypto-asset clients.
“Inaccurate or misleading representations and disclosures by crypto-asset companies […] may be unfair, deceptive, or abusive,” the agencies previously warned.
That language has now been officially retracted, signaling a broader regulatory softening toward the digital asset sector.
Part of Broader Trump Administration Policy Shift
This rollback is the first major action on crypto by the Federal Reserve under the Trump administration, which has already made moves to reposition the U.S. as a leader in crypto innovation.
In January, the Securities and Exchange Commission (SEC) reversed a controversial rule that had required banks holding crypto to report them as balance sheet liabilities, removing a key obstacle that slowed crypto adoption within the financial sector.
Together, these actions suggest a coordinated effort across agencies to open the door to wider crypto integration within the U.S. financial system.
Final Thoughts: A Regulatory Green Light?
The Federal Reserve’s withdrawal of prior crypto guidance is being interpreted by many as a green light for traditional financial institutions to explore digital asset services more freely.
While standard supervisory oversight remains in place, the elimination of pre-approval requirements and withdrawal of fraud-related warnings marks a clear softening of Washington’s stance toward crypto under Trump.
As the regulatory tide turns, U.S. banks may finally have the clarity and flexibility they need to embrace blockchain finance — and compete in a rapidly evolving global market.
