Federal Reserve Board withdraws supervisory guidance on banks’ crypto-asset and dollar token activities and ends related notification and nonobjection expectations

The Federal Reserve Board has withdrawn supervisory guidance covering banks’ crypto-asset and dollar token activities, changing its supervisory expectations for these activities. Oversight of banks’ crypto-asset activities will shift from advance-notification expectations to monitoring through the normal supervisory process. The Board rescinded its 2022 supervisory letter that expected state member banks to provide advance notification of planned or current crypto-asset activities, and it also rescinded its 2023 supervisory letter that set out a supervisory nonobjection process for state member banks engaging in dollar token activities. In addition, the Board, together with the Federal Deposit Insurance Corporation, joined the Office of the Comptroller of the Currency in withdrawing from two 2023 joint interagency statements addressing crypto-asset risks to banking organizations and liquidity risks arising from crypto-asset market vulnerabilities. The Board will work with the other federal banking agencies to consider whether additional guidance to support innovation, including crypto-asset activities, is appropriate.