The post Federal Reserve scraps old crypto policy, opens access to digital asset activities appeared on BitcoinEthereumNews.com.

The United States Federal Reserve has withdrawn old guidance that prevented certain banks, including uninsured state institutions, from engaging with crypto-facing activities under the same conditions as federally insured counterparts. Summary The Federal Reserve has rescinded its 2023 guidance that prevented uninsured state-chartered banks from engaging in crypto-related activities under Federal Reserve supervision. New guidance offers crypto-native banks a formal route to join the Fed and settle payments directly, without relying on intermediaries. According to the Fed, the decision to rescind the 2023 policy was grounded in the view that it was outdated and that both the financial system and the Board’s understanding of innovative products and services had “evolved” over the years. “The new policy statement creates an avenue for both insured and uninsured Board-supervised state member banks to engage in certain innovative activities,” the Fed wrote in its Wednesday guidance, allowing such institutions to participate in areas including cryptocurrencies, provided they meet supervisory expectations. Under the 2023 framework, uninsured banks that were primarily engaged in activities not permissible for national banks had to follow the same restrictions as insured institutions, even while their own charters allowed otherwise. As such, these institutions were effectively locked out of Fed membership and critical payment infrastructure. This guidance was also why Custodia Bank’s bid for a master account was denied, according to Custodia Bank CEO Caitlin Long, who welcomed the latest decision as a long-overdue correction and criticized Fed Governor Michael Barr, who dissented the updated guidance. Custodia Bank, which specializes in crypto custody and does not carry FDIC insurance, applied for a Fed master account back in 2020. However, at the time, a U.S. District Court for the District of Wyoming dismissed Custodia’s case after the Fed cited the very guidance that has now been rescinded. Barr, in a separate statement…

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Filed under: News - @ December 18, 2025 7:28 am