The Federal Reserve has just announced that they are loosening supervision of bank interactions with crypto. Previously, they maintained a program to monitor these activities, but now this program is closing.
This action reflects an executive order signed by President Trump last week, aimed at restricting unfair exclusion of crypto. This seems to be a positive development for the industry.
New Federal Reserve Cryptocurrency Guidelines
The Federal Reserve has been the target of criticism from many in the crypto industry in recent months, with Chairman Jerome Powell firmly refusing to lower interest rates. This led to a wave of criticism led by President Trump, but not everything is bad. Just today, the Fed announced that they are loosening their crypto regulations:
"The Federal Reserve Board announced on Friday that they will end the program monitoring novel activities and return to supervising novel activities of banks through the usual supervisory process. Since the Board began monitoring certain crypto and fintech activities in banks, the Board has strengthened its understanding of those activities," they stated.
Since the Fed has gained deeper insights into crypto, they declare they will end this program. This reflects recent developments in Trump's crypto enforcement campaign, with many executive orders seeking to limit unfair exclusionary practices.
By refusing to supervise bank interactions with crypto, the Federal Reserve's decision is very much in line with these orders. It is unclear how this new situation will play out in the market, but it seems very positive.
