The U.S. Federal Reserve (Fed) recently officially reversed its controversial regulatory guidance for banks seeking to enter the cryptocurrency sector, indicating a significant shift in its views on financial risk and innovation. This move is XEM as a crucial adjustment in U.S. banking supervision policy, especially as the digital asset market gradually recovers after the volatile period following the collapse of FTX.
Specifically, on December 17th, the Fed's Board of Governors repealed its 2023 Policy Statement, which had made the very strict assumption that Fed-supervised state-level member banks should not be allowed to engage in "novelty" activities beyond what is permitted for national banks, including many crypto-related services. Instead, the Fed issued a new, more flexible policy statement, reflecting a more open approach to financial innovation.
In its accompanying statement, the Fed acknowledged that its 2023 declaration had confined state-owned member banks to the same operating framework as banks under the supervision of other federal regulators. However, since then, the U.S. financial system has undergone significant changes, and the Fed's understanding of innovative products and services, including digital assets and blockchain technology, has also progressed considerably. This "evolution" in the perception of risks and opportunities has prompted the Fed to adjust its policy.
