The U.S. Federal Reserve (Fed) has completely abolished its cryptocurrency-related bank supervision program, leading to analyses suggesting a new breakthrough in Bitcoin (BTC) and traditional finance integration. Michael Saylor, a strong Bitcoin supporter, welcomed the move, stating, "Now the path is open for Bitcoin and the banking industry."
The abolished program was a supervisory body that had been operating since 2023, applying separate regulations to banks pursuing cryptocurrency experiments. While it was operated based on the argument of high volatility and significant technological risks, this decision means cryptocurrency-related financial services will now be managed within the existing supervision framework.
The Federal Reserve determined that special regulations for cryptocurrencies and fintech projects are no longer necessary. The reasoning is that existing banks have reached a level of understanding and self-management of these risks, and numerous experiments have increased the possibility of acceptance within the institutional framework. Accordingly, financial authorities have positioned that existing monitoring tools are sufficient to manage cryptocurrency transactions and technological developments.
This measure is evaluated as a catalyst for cryptocurrency adoption within the institutional framework. Jerome Powell, Fed Chairman, has previously mentioned that "cryptocurrencies are now moving into the mainstream." Particularly, as the institutional framework becomes clearer and policies are relaxed, the possibility of institutional investor market entry is expected to increase.
Cynthia Lummis, a Republican senator and Bitcoin supporter, described this decision as the "end of Checkpoint 2.0", suggesting that bank access restriction policies for cryptocurrency companies have essentially been terminated. This is seen as a meaningful change from previous administrative regulatory trends and is expected to have a positive impact on industry normalization and growth foundation.
Meanwhile, U.S. financial authorities have been strengthening institutionalization by releasing specific guidelines for cryptocurrency custody services to the banking sector last month. The Fed's current move is part of this effort and is expected to be a crucial turning point for the global cryptocurrency industry.
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