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- FDIC removed a rule that required banks to get approval before offering crypto services.
- Banks can now engage in crypto if they manage risks and follow rules set by regulators.
- The new policy reflects support for crypto under the Trump administration and ends Biden era restrictions.
The Federal Deposit Insurance Corporation has officially withdrawn its 2022 policy requiring banks to notify the agency before engaging in crypto-related activities. The announcement, made on March 28, reflects a shift in regulatory tone under the Trump administration. Banks can now pursue digital asset services without first seeking permission, provided they follow risk management standards and comply with relevant laws.
The 2022 rule was introduced under the Biden administration and faced strong opposition from the crypto industry. Many firms said the rule created delays and discouraged banks from supporting crypto businesses. Under the new guidance, FDIC-supervised institutions can enter the digital asset space more freely, marking a significant change in the federal approach to crypto and banking.
Banks Still Responsible for Risk Management
While banks do not need previous approval, they must perform adequate risk assessments. The FDIC listed essential concerns which institutions must analyze before starting crypto operations. The three main operational risks that financial institutions must consider are market volatility, liquidity issues, and operational risks. The main focus of banks must include defense against cybersecurity attacks and threats.
Banks must continue to comply with laws such as consumer protection and Anti-Money Laundering regulations. The FDIC stressed that institutions should understand the risks tied to each crypto activity. While they have more freedom, they remain accountable for maintaining safety and soundness.
The updated rules are outlined in a new Financial Institution Letter (FIL-7-2025). It confirms that FDIC-supervised institutions may engage in crypto activities allowed by law without receiving prior approval from the agency. This letter replaces previous guidance that some critics said created confusion and slowed down innovation.
Political and Regulatory Shifts Influence Change
Earlier this month, the Office of the Comptroller of the Currency reaffirmed that national banks can offer certain crypto services. These include custody solutions and stablecoin transactions.
Donald Trump has expressed strong support for digital assets and has criticized the Biden administration’s stance. On March 7, he claimed the previous administration pressured banks to block crypto businesses. Documents released through Freedom of Information Act requests revealed that the FDIC had often discouraged crypto engagement during that time.
Lawmakers also raised concerns, comparing past restrictions to “Operation Chokepoint 2.0,” an Obama-era practice that targeted specific industries. Critics said similar informal pressure was used to block crypto access to banking services.
Further Guidance on Crypto Services Planned
The FDIC plans to issue more guidance on crypto-related services, including custodial platforms and lending operations. It will continue working with the President’s Working Group on Digital Asset Markets.