The Federal Deposit Insurance Corporation (FDIC) has recently introduced new guidance that opens the door for banks under its supervision to venture into bitcoin and crypto activities without having to get pre-approval. This marks a significant shift away from the policy set during the Biden administration, which was often seen as a hurdle.
In an announcement made on March 28, the FDIC stated that banks now have the opportunity to offer services related to cryptocurrencies, like custody and trading, as long as they have measures in place to manage associated risks effectively. Moreover, the agency committed to updating its crypto regulations to keep pace with the evolving landscape.
Previously, a Financial Institution Letter from 2022 required banks to secure FDIC approval before they could engage in dealing with bitcoin and other crypto assets. This regulation was often a sticking point for banks eager to explore the crypto space.
By lifting this restriction, the FDIC is aiming to foster a more exploratory environment for its supervised banks within the emerging crypto ecosystem. However, while this opens up new possibilities, actual permissions will still hinge on coordination between different regulatory agencies.
Commenting on this change, Acting FDIC Chairman Travis Hill highlighted it as part of a broader initiative to create a secure and supportive framework for crypto activities. He remarked, “The FDIC is moving forward from the missteps of recent years.” As part of this initiative, the agency plans to issue further guidance after discussions with the President’s Working Group on digital assets.
Despite murky regulations, major banks have already dipped their toes into bitcoin and crypto services. By providing clearer regulatory insights, the FDIC aims to encourage more banks to join in and explore these new opportunities.
