On April 24, 2025, the Federal Reserve quietly pulled the plug on two major rules that had been holding back banks from offering crypto services. No press conferences. No fanfare. Just a simple announcement that removed the need for banks to ask permission before letting customers buy, hold, or custody Bitcoin and other digital assets. This wasn’t a tweak. It was a full reset of how American banks can interact with cryptocurrency.
What Exactly Changed?
Before 2025, if you worked at a bank and wanted to offer crypto custody or handle stablecoins, you had to jump through hoops. The Federal Reserve’s SR 22-6 and SR 23-8 letters forced banks to notify regulators in advance and get formal approval before even starting. It wasn’t just bureaucracy-it was a de facto ban. Many banks just gave up. Why risk a months-long approval process when you could focus on mortgages or small business loans instead? The Office of the Comptroller of the Currency (OCC) led the charge. On March 7, 2025, they rescinded Interpretive Letter 1179, a 2021 rule that had told national banks they needed special permission to custody crypto. Now, banks can hold digital assets for customers without asking. The FDIC followed on March 28, removing its own notification requirement for state-chartered banks. Suddenly, every major bank in the U.S. could legally offer crypto services without waiting for a regulator’s green light.Why Now?
The change didn’t come out of nowhere. After years of crypto collapses-FTX, Celsius, BlockFi-the regulators in 2021 and 2022 took a hardline stance. They wanted to protect consumers and the financial system. But over time, they realized something: the banks weren’t the problem. The problem was unregulated exchanges and shady operators outside the banking system. By 2024, banks had already built out crypto custody systems, hired compliance teams, and trained staff. The Federal Reserve’s own examiners had become fluent in blockchain technology. They saw that banks were handling crypto responsibly-often more responsibly than some crypto-only firms. So instead of fighting the tide, they decided to bring crypto into the regulated mainstream. The OCC said it plainly: "The supervisory non-objection process is no longer necessary." They didn’t lower standards. They just stopped treating crypto like a dangerous experiment.What Can Banks Do Now?
Under the new rules, banks can legally do three big things without prior approval:- Custody crypto assets for customers-holding Bitcoin, Ethereum, or other tokens securely on their behalf.
- Hold stablecoins like USDC or USDT as part of reserve management or payment systems.
- Participate in independent node verification networks, meaning banks can run their own blockchain nodes to validate transactions.
What’s Still Off Limits?
Don’t get the wrong idea. This isn’t a free-for-all. Banks still can’t:- Hold non-stablecoin crypto on their own balance sheets-they can’t buy Bitcoin as an investment.
- Lend against crypto assets-no crypto-backed loans yet.
- Trade crypto for profit-market-making or proprietary trading is still restricted.
What This Means for You
If you’re a regular bank customer, this change means faster, simpler access to crypto. Soon, you’ll see options like:- Buy Bitcoin directly in your mobile banking app.
- Receive crypto payments from employers or freelancers into your checking account.
- Use stablecoins to send money overseas with lower fees and faster settlement.
What’s Next?
The regulators have made it clear this is just the first step. In their April 2025 joint statement, the Fed, OCC, and FDIC said they’re working with the President’s Working Group on Digital Asset Markets to draft more guidance. What’s left to figure out? Lending, staking, DeFi integration, and how to handle volatile crypto assets beyond stablecoins. Some experts believe the next big move will be allowing banks to offer crypto-backed loans-something that’s already common in Europe and Asia. Others think we’ll see banks launch their own stablecoins, backed by U.S. Treasuries and regulated like money market funds. One thing’s certain: the door is open. The banks are ready. The technology is proven. And customers are waiting.Why This Matters Beyond Banking
This isn’t just about banks. It’s about the future of money. For years, crypto was seen as something separate-outside the system. Now, it’s being folded into the core of American finance. That shift changes everything. When your bank offers crypto custody, it validates digital assets as real financial instruments. When your paycheck can be paid in USDC, it makes crypto useful, not just speculative. When you can send money to family overseas using a stablecoin with near-zero fees, it exposes how broken traditional cross-border payments are. This isn’t the end of regulation. It’s the beginning of smarter regulation. The old rules treated crypto like a fire hazard. The new rules treat it like electricity-useful, powerful, and dangerous if misused. But now, the power grid is open for business.Can I now buy Bitcoin directly through my bank app?
Yes-banks can now offer crypto buying and custody services without prior regulatory approval. Major banks like Chase, Wells Fargo, and Bank of America are expected to roll out these features in 2025. You’ll be able to purchase Bitcoin, Ethereum, or stablecoins directly within your mobile banking app, with funds settled in your linked checking account.
Is my crypto protected by FDIC insurance?
No. FDIC insurance only covers traditional deposits like checking and savings accounts. Crypto assets held by your bank are kept in secure custody, but they are not insured by the FDIC. Banks must clearly disclose this to customers. However, the fiat portion of your account (dollars) is still protected up to $250,000.
Can my bank lend me money using my Bitcoin as collateral?
Not yet. Banks are still prohibited from offering crypto-backed loans under the 2025 changes. This remains a regulatory gray area. While some crypto-native lenders offer this service, traditional banks are not allowed to do so until further guidance is issued. The regulators are actively studying this issue, but no timeline has been announced.
Are stablecoins now considered safe by regulators?
Yes. The OCC and Federal Reserve now explicitly permit banks to hold and transact in dollar-denominated stablecoins like USDC and USDT. This recognition treats stablecoins as a legitimate form of digital money-as long as they’re fully backed by cash or short-term U.S. Treasuries. Regulators are pushing for more transparency from stablecoin issuers, but they’ve stopped treating them as risky experiments.
Will this lead to more crypto scams?
The risk of scams hasn’t gone away, but it’s now being managed differently. Banks are subject to strict anti-money laundering (AML) and know-your-customer (KYC) rules. Every crypto transaction goes through the same fraud filters as a wire transfer. This makes it harder for scammers to move stolen crypto through traditional banks. The real risk now lies with unregulated exchanges and peer-to-peer platforms-not your bank.
Jayakanth Kesan
December 25, 2025 AT 18:02This is actually huge. No more jumping between apps just to buy Bitcoin. My bank app is about to become my main crypto gateway.
Janet Combs
December 27, 2025 AT 16:07i never thought id see this day. banks finally get it. crypto isnt the enemy, the scammers are. glad they’re catching up
Ashley Lewis
December 28, 2025 AT 14:39The regulatory clarity is commendable. However, the absence of FDIC coverage for digital assets remains a structural deficiency of alarming proportions.
Megan O'Brien
December 28, 2025 AT 23:51So banks can custody now but can’t lend against it? That’s like letting a chef touch the ingredients but not cook anything. Half-measure regulation.
Rishav Ranjan
December 29, 2025 AT 13:23They’re just catching up. Took long enough.
Zavier McGuire
December 30, 2025 AT 07:09finally someone in power realized you cant fight tech with paperwork
SHEFFIN ANTONY
December 30, 2025 AT 22:15Don’t be fooled. This is just the Fed letting banks get rich off crypto while keeping the real power with the exchanges. They’re not bringing crypto in-they’re fencing it off.
Rebecca F
January 1, 2026 AT 16:07So now your bank can hold your Bitcoin but not let you use it to buy a car or pay your rent? What’s the point if it’s still locked in a vault they control? This isn’t freedom. It’s custody with a side of condescension.
Grace Simmons
January 2, 2026 AT 21:18This is dangerous. America’s banking system should not be involved in speculative digital assets. We are opening the door to foreign manipulation and systemic risk.
Sybille Wernheim
January 4, 2026 AT 19:40This is the moment crypto stopped being fringe and started being normal. Imagine sending money to your cousin in Nigeria without paying $30 in fees. This changes lives.
Vijay n
January 6, 2026 AT 17:38They say they’re not allowing banks to trade crypto but what if they quietly do it through shell entities? The Fed is full of insiders who own Bitcoin already. This is just a cover
Collin Crawford
January 7, 2026 AT 10:35It is imperative to note that the absence of explicit legislative codification renders this regulatory shift inherently unstable. Future administrations may rescind these interpretations with minimal procedural burden.
Dan Dellechiaie
January 8, 2026 AT 07:24Let me translate this for the non-bankers: They finally admitted they lost. Crypto isn’t going away. So instead of blocking it, they’re trying to monetize it while pretending they’re still in charge. Classic.
Cathy Bounchareune
January 8, 2026 AT 14:47My abuela in Mexico gets paid in USDC now. No more 7-day wire delays. No more $50 fees. She calls it ‘digital cash’. I call it justice.
Amit Kumar
January 10, 2026 AT 13:56India’s banks are already testing this. If US banks roll this out right, they’ll crush Coinbase. Crypto’s future isn’t in exchanges-it’s in your checking account.
Radha Reddy
January 11, 2026 AT 07:45While the regulatory clarity is appreciated, one must remain cautious regarding the potential for moral hazard. The integration of crypto into core banking infrastructure, absent full capital adequacy requirements, may expose the system to unforeseen volatility.