The Federal Reserve announced the removal of 'reputational risk' as an oversight factor in crypto banking on June 23, 2025.
New Fed Decision
The Federal Reserve has decided to eliminate the reputational risk aspect from bank examinations related to crypto services. This is aimed at facilitating enhanced bank participation in crypto products and potentially expanding market opportunities for digital assets.
Impact on the Crypto Market
The removal is a coordinated effort alongside the Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency. This move effectively motivates banks to explore crypto developments more freely, paving the way for increased institutional investments in cryptocurrencies like Bitcoin and Ethereum.
Expert Expectations
Experts expect that this regulatory shift will encourage further technological progress and higher liquidity within decentralized finance platforms. Increased institutional interest can bolster trust and expansion of crypto ETFs in the broader market.
The overall push for greater bank participation in crypto developments may lead to increased market activity and enhanced crypto prices.
