The Federal Reserve (FED) relaxes cryptocurrency regulatory requirements: withdraws relevant guidelines, releases new regulatory signals.

The Federal Reserve (FED) announced on April 24 that it will withdraw its regulatory guidance regarding banks engaging in activities related to encryption assets and dollar stablecoin, and will simultaneously adjust the relevant regulatory expectations. This represents the FED's open attitude towards financial innovation and reflects the ongoing evolution of regulatory agencies' risk assessment of encryption assets.

Loosen regulations, The Federal Reserve (FED) withdraws the 2022 encryption notification requirements.

According to the statement, The Federal Reserve (FED) has officially withdrawn the regulatory letter issued in 2022, which required state member banks to notify regulators in advance before engaging in encryption asset business. Now, this requirement will no longer apply, and the continuous supervision of banks' encryption activities will be conducted through existing regulatory processes.

This means that if banks wish to advance into or have already entered the cryptocurrency field, they no longer need to make additional declarations; they only need to cooperate with regular supervision, which simplifies the original administrative procedures.

The stablecoin regulatory process was also canceled in 2023.

The Federal Reserve (FED) also revoked the supervisory nonobjection process for "USD token activities" in 2023. This was originally an evaluation process to determine whether banks could legally participate in USD stablecoin projects.

This move means that the Federal Reserve (FED) will no longer require banks to obtain a regulatory "no objection statement" in advance, but will instead incorporate such activities into daily regulatory oversight, indicating an increased risk tolerance for innovative financial instruments such as stablecoins.

Joint Action: Three Major Institutions Withdraw Crypto Statement

This regulatory easing is not only led by The Federal Reserve (FED). The Federal Reserve (FED) and the Federal Deposit Insurance Corporation (FDIC) announced that they will jointly withdraw two joint statements issued in 2023 with the Office of the Comptroller of the Currency (OCC), which originally imposed restrictions and warnings on banks' involvement in encryption assets and their exposures.

Support innovation, The Federal Reserve (FED) releases regulatory flexibility.

The Federal Reserve emphasized that the purpose of this change is to ensure that regulatory expectations are aligned with the development of market risks, while also supporting the banking industry's exploration in innovative areas. The statement mentioned that in the future, it will collaborate with other regulatory agencies to issue new guidelines as needed to support the sound development of emerging financial activities such as encryption assets.

In other words, this does not mean that The Federal Reserve (FED) has completely relinquished regulation, but rather has chosen a more flexible and industry-oriented approach to respond to the rise of encryption assets.

Loosening does not mean letting go, encryption finance is still under scrutiny.

Although these measures are seen as a regulatory loosening, they actually show that regulatory agencies are adjusting their strategies, shifting from "reporting before execution" to "continuous supervision and flexible response." The Federal Reserve (FED) is trying to find a balanced path between innovation and risk.

For the banking industry, this will provide them with more flexibility to venture into the fields of encryption and stablecoin; for the cryptocurrency industry, it is another potential policy bullish signal.

This article The Federal Reserve (FED) eases cryptocurrency regulation requirements: withdraws related guidelines, releases new regulatory signals first appeared in Chain News ABMedia.