The Federal Reserve has announced it will sunset a targeted crypto and fintech oversight program established during the Biden administration and absorb its functions into routine bank supervision.
The initiative, launched in 2023 via a “novel activities” supervision program, was specifically designed to monitor banks’ involvement in digital assets such as stablecoins and other crypto-related activities.
The Fed said the program succeeded in deepening its understanding of risks and institutions’ control systems, Bloomberg reported on Friday.
As a result, it's rescinding the 2023 supervisory letter that created the framework and integrating oversight into standard examinations.
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This shift follows similar actions by U.S. banking regulators who, earlier in 2025, withdrew guidance requiring banks to notify authorities before offering crypto services such as custody or stablecoin-related operations.
The 2023 initiative originated from a Biden-era directive to subject banks to advance approval, or supervisory nonobjection, before engaging in digital asset activities, especially involving stablecoins ("dollar tokens").
State member banks were required to demonstrate robust risk controls to qualify.
Additionally, the Federal Reserve, along with the FDIC and OCC, issued 2023 Joint Statements warning banks of risks associated with crypto assets, such as volatility, legal uncertainty, and liquidity vulnerabilities.
These statements have now been withdrawn.
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