The Federal Reserve has announced it will shut down its dedicated program that focused on overseeing banks involved in crypto and fintech. Known as the “novel activities” supervision program, it was launched in 2023 to monitor emerging financial technologies more closely. Now, those responsibilities will be absorbed into the Fed’s standard supervisory process. This change shows the Fed feels better equipped to evaluate crypto-related risks , including services like stablecoins, digital asset custody, and tokenization, without needing a separate framework. Instead of requiring heightened scrutiny, these activities will now be reviewed like any other banking operations. The move is part of a larger rollback of regulatory barriers this year. In April, the Fed, FDIC, and OCC dropped rules requiring banks to seek pre-approval for crypto services. Then in June, the Fed removed “reputational risk” as a factor in how banks are judged—shifting the focus to concrete financial concerns. For crypto and fintech players, this shift could open the door to more seamless integration with traditional banking , reducing friction and uncertainty around compliance.
