FDIC says banks can engage in crypto activities without prior approval

The Federal Deposit Insurance Corporation (FDIC) issued new guidance on March 28 clarifying that FDIC-supervised banks may engage in crypto-related activities without first obtaining the agency’s approval, provided they manage the associated risks by safety and soundness standards.

The announcement, published as Financial Institution Letter (FIL-7-2025), rescinds FIL-16-2022 and marks a significant policy shift for the agency. 

Acting Chairman 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 said it will continue working with the President’s Working Group on Financial Markets to issue additional guidance and coordinate with other regulatory agencies to replace prior interagency documents on digital assets.

The Executive Director of the Presidential Working Group on Digital Assets Markets, Bo Hines, called the decision “a huge step forward toward innovation and adoption.”

The agency’s decision reflects a broader effort to reset its approach to financial innovation. 

‘Pause’ letters

In recent years, several banks pursuing digital asset activities reportedly received informal “pause” letters instructing them to halt engagement with crypto services, including custody, tokenized deposits, and even basic retail crypto offerings.

Crypto industry figures said these decisions were a part of “Operation Chokepoint 2.0,” an alleged effort by former President Joe Biden’s administration to hinder the crypto industry’s growth in the US.

Hill has criticized the actions for lacking transparency and contributing to a perception that the FDIC discouraged innovation through non-public enforcement tactics.

In a January speech, he acknowledged that the agency had failed to offer banks clear public guidance, opting instead for ad hoc interventions. 

He cited the over 20 cases where banks had received letters asking them to stop or delay crypto-related activities without formal rulemaking or open comment periods.

Call to reevaluate

Hill emphasized that compliance with the Bank Secrecy Act should not be used as a pretext for denying access to banking services and called for a reevaluation of how the BSA is implemented across financial institutions.

Recent internal discussions at the FDIC haven reortedly focused on allowing banks to pursue tokenized deposit services and other blockchain-based financial infrastructure without unnecessary regulatory delays.

The move brings the FDIC into closer alignment with other regulators, such as the US Securities and Exchange Commission (SEC), which has begun formalizing crypto regulatory frameworks.

It also comes amid growing pressure from industry participants and lawmakers for banking regulators to provide a consistent, transparent roadmap for lawful crypto-related services.

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