{"id":59697,"date":"2025-12-18T10:30:50","date_gmt":"2025-12-18T07:30:50","guid":{"rendered":"https:\/\/coinengineer.net\/blog\/?p=59697"},"modified":"2025-12-18T09:09:26","modified_gmt":"2025-12-18T06:09:26","slug":"fed-withdraws-2023-crypto-guidance-for-banks","status":"publish","type":"post","link":"https:\/\/coinengineer.net\/blog\/fed-withdraws-2023-crypto-guidance-for-banks\/","title":{"rendered":"Fed Steps Back: Bank-Crypto Restrictions Are Lifted"},"content":{"rendered":"

The US Federal Reserve<\/strong> has officially withdrawn its 2023 guidance that restricted how banks<\/strong> interact with crypto<\/strong> assets. The decision marks a structural shift in how Fed-supervised institutions approach digital assets. For banks operating in the crypto space, long-closed doors are now reopening.<\/p>\n

The withdrawn guidance required uninsured banks to follow the same limitations as federally insured institutions. As a result, many crypto-friendly banks were effectively barred from Fed membership and access to core payment systems. The Fed now acknowledges that both the financial system and regulatory understanding have materially evolved since that framework was introduced.<\/p>\n

\n
\n

Table of Contents<\/p>\nToggle<\/span><\/path><\/svg><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n

  • Fed Explains Why The 2023 Crypto Guidance Was Withdrawn<\/a><\/li>
  • Custodia Bank Case Highlights Regulatory Friction<\/a><\/li>
  • New Fed Framework Creates Pathway For Bank Innovation<\/a><\/li>
  • Market And Investor Behavior Implications<\/a><\/li><\/ul><\/nav><\/div>\n

    <\/span>Fed Explains Why The 2023 Crypto Guidance Was Withdrawn<\/span><\/h2>\n

    In its statement, the Federal Reserve said the 2023 guidance no longer reflected current risks or product structures. The central bank emphasized that innovation across financial services has accelerated. Regulatory tools designed two years ago are no longer sufficient to address today\u2019s market dynamics.<\/p>\n

    Crucially, the Fed signaled a shift away from blanket activity bans. Instead of prohibiting certain crypto-related services outright, the updated approach focuses on how risks are managed. This change is especially significant for state-chartered banks that were previously excluded from crypto services by default.<\/p>\n

    Trump: \u201cThe Fed Chair Should Consult Me on Interest Rates\u201d<\/em><\/a><\/p>\n

    <\/span>Custodia Bank Case Highlights Regulatory Friction<\/span><\/h2>\n

    Custodia Bank CEO Caitlin Long publicly welcomed the decision. She stated that the now-withdrawn guidance was cited when the Fed denied Custodia\u2019s application for a master account. Such accounts allow banks to settle payments directly in central bank money, rather than through intermediaries.<\/p>\n

    Long argued that the Fed relied on the guidance even before it was formally finalized. According to her, leadership changes inside the central bank have weakened the anti-crypto stance that previously dominated supervisory decisions. Her remarks underscore growing internal divergence within US financial regulators.<\/p>\n

    \n

    @federalreserve<\/a> withdraws 2023 policy statement and issues new policy statement regarding the treatment of certain Board-supervised banks that facilitates responsible innovation: https:\/\/t.co\/5s1I9LO9EF<\/a><\/p>\n

    — Federal Reserve (@federalreserve) December 17, 2025<\/a><\/p><\/blockquote>\n