Federal Reserve ends special oversight of crypto at banks
Last Updated on 15 August 2025 by CryptoTips.eu
The US central bank is changing course when it comes to supervising crypto and fintech activities at banks. The special supervisory program launched in 2023 to scrutinize these “novel” activities of financial institutions is being discontinued. Instead, the Federal Reserve will return to using the standard supervisory process already in place for other banking activities.
Crypto and fintech no longer get special treatment
With the termination of the so-called Novel Activities Supervision Program, the Fed wants to make it clear that it is comfortable with how banks are managing crypto, digital assets and innovative technologies. The program was originally created to closely monitor the risks associated with these emerging markets, such as crypto custody, blockchain technology, stablecoins and related fintech solutions.
According to the central bank, that goal has now been achieved. They have gained sufficient understanding of the risks and how banks manage them. As a result, a separate approach is no longer necessary and these activities will now be treated like any other financial products and services. The official 2023 policy that shaped the program is being withdrawn.
A signal to the market: crypto is becoming normal
Although the news may seem technical at first glance, the symbolism is significant. The fact that the Fed no longer considers crypto activities as “outliers” can be seen as a signal of normalization. Crypto is simply part of the system now, and banks no longer need to be placed on a separate list to work with it.
That does not mean there will be no oversight. On the contrary, crypto and fintech activities remain subject to supervision, but now within the existing framework. No more extra hurdles or special procedures.
JUST IN: FEDERAL RESERVE TO END PROGRAM MONITORING BANKS ON BITCOIN, CRYPTO, AND FINTECH ACTIVITIES
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The announcement is receiving mixed reactions from the sector. Some view it as a positive sign that banks are getting more freedom to work with crypto. Others warn that less targeted oversight could create new risks if the market grows rapidly again.
For now, it seems the Federal Reserve is giving crypto a permanent place within the regular financial system.
