The United States Federal Reserve has announced the withdrawal of its special guidance for banks regarding crypto-asset and dollar token activities. Let’s understand it: 

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Easier Entry into Crypto for Banks

     Previously, banks in the U.S. were required to provide advance notice and obtain special approval before engaging in crypto-related business. Now that this guidance has been rescinded, such prior notifications are no longer necessary. However, this does not equate to complete financial freedom – banks must still comply with existing laws and regulatory frameworks.

A Big Step for the Cryptoverse

     This move increases the likelihood that more banks will begin offering crypto services, potentially bringing more flexibility and innovation to the U.S. banking sector. With increased competition among financial institutions, users can benefit from a wider range of options. It also paves the way for mainstream adoption of on-chain services like DeFi.

My Point

     Crypto is inherently borderless and volatile. While operating within the boundaries of laws and ensuring proper risk management and compliance, this can also pose some challenges for the crypto landscape. Nevertheless, due to Donald Trump’s ambition to establish the US as a global crypto hub, it is possible that the upcoming regulations will encourage the cryptoverse even more.

Originally published on Wubits