Why did the Fed scrap the dedicated crypto oversight unit?
The US Federal Reserve has announced it will shut down its dedicated program for overseeing banks’ involvement in cryptocurrencies and financial technology, folding the work into its broader supervisory framework. The decision marks a significant shift in how America’s top banking regulator approaches emerging technologies.
According to Reuters, the Fed confirmed on Friday that it will end its “novel activities supervision program,” which was set up in 2023 to specifically monitor how banks engage with crypto firms, blockchain projects and other fintech ventures. At the time, regulators were concerned about gaps in oversight as digital assets and new financial platforms moved deeper into the mainstream banking system.
