FDIC Allows Banks to Engage in Crypto Without Approval

Highlights:

• FDIC removes 2022 policy, allowing banks to engage in crypto without approval.
• The agency urges banks to assess risks, including cybersecurity and liquidity issues.
• Industry welcomes the move, but some criticize the lack of strict oversight.

The U.S. Federal Deposit Insurance Corporation (FDIC) is changing its approach to digital assets under the Donald Trump administration. The FDIC’s latest guidance, announced on March 28, rescinds a 2022 policy that required banks to notify the agency before engaging in crypto activities.

This change reverses a rule from Joe Biden’s administration. Earlier, banks had to notify the agency before dealing with crypto.

FDIC Acting Chair Travis Hill stated:

“With today’s action, the FDIC is turning the page on the flawed approach of the past three years. I expect this to be one of several steps the FDIC will take to lay out a new approach for how banks can engage in crypto and blockchain related activities in accordance with safety and soundness standards.” 

The FDIC advised banks to assess risks before engaging in crypto activities. These risks include market and liquidity issues. Operational and cybersecurity threats are also concerns. Banks must follow consumer protection and Anti-Money Laundering rules.

The new guidance gives banks more freedom to engage in crypto activities. The FDIC will still collaborate with the President’s Working Group on Digital Asset Markets moving forward. It also plans to release more guidance on crypto activities like custodial services and lending platforms.

BREAKING: FDIC says banks can engage in crypto activities without prior approval. pic.twitter.com/H0eGXfvSna

— Bitcoin Magazine (@BitcoinMagazine) March 28, 2025

Regulators Align as Trump Supports Crypto-Friendly Policies

This decision follows a similar move by the Office of the Comptroller of the Currency (OCC). Earlier this month, the agency confirmed that national banks can engage in some crypto activities. These include custody services and stablecoin transactions. This follows Donald Trump’s support for crypto. He criticized Biden’s tough stance on banks and crypto. On March 7, he claimed Biden’s administration pressured banks to block crypto businesses.

Mixed Reactions to FDIC’s Crypto Policy Shift

Industry representatives see the FDIC’s guideline change as a positive step. It brings crypto further into the banking sector. Bo Hines, executive director of the President’s Council of Advisers for Digital Assets, called it a “big win.” Removing approval requirements makes it easier for banks to enter the digital asset market.

Another big win!

The FDIC just dropped its 2022 rule requiring banks to get pre-approval before engaging with crypto-related activities.

A huge step forward towards innovation and adoption! https://t.co/EDAGgNuhr9

— Bo Hines (@BoHines) March 28, 2025

American Bankers Association President and CEO Rob Nichols supported the FDIC’s decision. He welcomed the new guidance allowing banks to engage in crypto activities without prior approval. According to him, U.S. banks are exploring ways to compete safely in financial services. He also emphasized that clear regulations are essential for driving innovation in the sector.

Some raised concerns about the sudden policy shift. Bank advisor Donald F. Billings reacted sarcastically on LinkedIn. He commented that the FDIC’s new requirement for crypto activities is just a “pinky swear.” This implies that the agency is relying on trust rather than strict oversight, making the regulation seem weak or informal.