The of-The banking of digital assets in the United States received another boost last week when the Federal Reserve (Fed) announced The withdrawal of guidance that requires the banks providing advance notification of planned or current digital asset activities. Fed too Published A joint statement with the Federal Deposit Insurance Corporation (FDIC) and the Office of the Foreign Exchange (OCC) and reverses two previous statements that warned banks on their exposure to digital assets due to concerns about potential risks of fraud and fraud.
On April 24 Supervision letter Establishment of an expectation that state member banks provide advance notification of digital asset activities.
“As a result, the Board will no longer expect the banks to give the notification and will instead monitor the banks’ crypto access activities through the normal supervisory process,” mentioned the statement. “These measures ensure that the Board’s expectations remain in line with developing risks and support further innovation in the banking system.”
The Board also canceled a 2023 Supervision letter requires the banks to apply for supervisory authorities before participating in Stablecoins activities.
On the same day, in a related announcement, Fed joined the FDIC – the US government organization providing deposit insurance to depositors in US commercial banks and savings banks – and OCC – an independent agency within the Department of the Tax Chamber that regulates and monitors all national banks and the Federal Support Association – for the extent that the banks’ activities.
The withdrawn joint statements, issued on January 3, 2023 and February 23, 2023Addressed risks for digital assets and liquidity risks to banking organizations as a result of “market tules”, including fraud, fraud, legal uncertainties and “significant volatility.”
Of many in the digital asset industry, these statements were seen as a form of indirect regulation, pressing banks and financial institutions so as not to handle digital asset companies, in line with an perceived anti-crrypto agenda during the administration of former President Joe Biden.
In its announcement that withdrew the statements, the agencies explained that: “This measure is intended to provide clarity that banking organizations may participate in permissible crypto resources and provide products and services to persons and companies that carry on crypto-eights, in accordance with security and health and applicable laws and regulations.”
The agencies added that they explored additional clarity for banking organizations’ digital access and related activities in the coming weeks and months.
These efforts to withdraw previous statements and provide further clarity are part of an ongoing project under President Donald Trump to Turn the assumed debate of the digital asset industry under his predecessor.
Digital Asset Debanking
“Debanking” refers to the process for financial institutions that limit or terminate banking services for certain companies due to regulatory problems, compliance risks or perceived instability, and in digital assets, all of the above.
Under Biden, important US regulators for the financial sector, including Fed, FDIC, OCC and Securities and Exchange Commission (Sec), in particular, seemed to increase its review of digital asset companies. This non-official project was renewed by several high-profile collapse and scandals in the digital asset space, for example FTX and Ground moon 2022 and Binance 2023.
In light of these different controversy, in January 2023 Fed, FDIC and OCC issued their joint statement Warning banks about the risks of managing digital asset -related companies.
Specifically, they said that “issue or hold as main crypto resources issued, stored or transferred on an open, public and/or decentralized network, or similar systems are very likely to be inconsistent with safe and sound bank practice.”
Fed later Published an order Denies Custodia Banks application For membership, with reference to concerns about the risks of digital assets, which seemed to confirm the industry’s fear that the administration and establishment had an anti-digital asset agenda.
This view was reinforced only by SEC’s tough strategy for the industry under former chairman Gary GensesThat made it potentially risky and less profitable when there was always half a chance that they may be at the end of Sec -charges for securities laws.
These various legislative measures were accompanied by-or depending on who you are talking to, caused-20123 collapsed by several digital asset-friendly banks, SilvergateThe Signature Bankand Silicon Valley Bank.
In February 2023, digital currency advocates and venture capitalist Nic Carter coined the term ”Operation Choke Point 2.0“To describe what he thought, this coordinated attempt was from federal agencies to limit digital asset banks.
But after Trump, a singing advocate for the digital asset industry, took office in January, the landscape began to look definitely different.
In February, a sub-committee was called the House of Financial Services to investigate “The negative effects of the Biden administration’s operation Choke Point 2.0”, where sub-Committee Chairman Dan Meuser (R-PA) claimed that it had been an official policy for the previous administration “which is performed by the prudent regulator
Reverse debanal in Trump 2.0 ERA
Legislators and supervisory authorities to reverse debanal began with Gusto almost as soon as Trump was back in the White House.
On February 6, Travis Hill, acting chairman of FDIC, announced that the organization was “Actively re-evaluate our supervisory method into crypto-related activities.” This was followed shortly – also in February – by the Trump administration dismantled Consumer Agency for Economic Protection (CFPB), a federal agency whose task is to support consumers in their business with financial institutions, such as banks, credit associations, payrolls, debt collectors and – significant – digital asset exchange.
Shortly after being appointed to the role, acting CFPB Director Russel Vought told cfpb personnel to “cease all surveillance and investigation activity” and to stop all enforcement measures. The next domino to fall was OCC, which in March made it clear that digital asset activities are allowed in the federal banking system.
In a March 7 ””Letter 1183“The agency confirmed that:“ Crypto Asset Custody, some StableCoin activities and participation in independent nodgerification networks as a distributed general account are permitted for national banks and federal savings associations. “
The letter also repealed a requirement for OCC-monitored institutions for obtaining supervisory-expression-expression approval from supervisory authorities-and shows that they have sufficient checks in place before they can participate in digital asset activities.
Meanwhile, in the legislative area, March 6 Senate’s Banking Committee Chairman Tim Scott (R-SC) Published a bill Specifically aims to combat digital asset department.
‘The Act on Economic Integrity and Regulatory Management (Company)“Would limit” weapons of federal banking offices “by eliminating the ability for supervisory authorities to use reputation as a measure to determine the security and health of regulated financial institutions.
“As chairman of the Senate Bank Committee, I have made it to debate a highest priority,” Scott said when I announced the bill. “This discriminatory and O -American practice should touch on everyone, which is why I have led my colleagues in working to find concrete solutions.”
On March 13, Senate Bank Committee voted to promote the bill.
With the American plant that increasingly covers very malicious industry, it is likely that digital asset -supporting legislation, such as the fixed law, will be a common view over the next four years of Trump’s second term.
Watch: It’s time for regulation to enable blockchain growth
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